While the $1.7 billion deal initially complements and expands Gannett's assets in two traditional media categories-newspapers and TV stations-it will also facilitate the company's entry and re-entry into a variety of electronic media, including cable TV and TV entertainment programming.
Gannett's first and last large-scale entry into the TV programming business-the much ballyhooed, but ill-fated fall 1988 launch of "USA Today on TV," a syndicated TV version of its flagship newspaper-proved to be a dismal failure and public embarrassment that sent the powerful media conglomerate recoiling from the business in early 1990.
Multimedia, however, has had a long-running, if somewhat modest success as a TV programmer, with such syndication mainstays as "Donahue," "Sally Jessy Raphael," "Rush Limbaugh" and other talk shows, plus its recently launched NewsTalk Television cable network.
It is that latter vehicle that seems most ideal for Gannett to use to exploit its newspaper content.
"They must be thinking about some ties between NewsTalk Television and USA Today. It strikes me as the perfect fit for adapting USA Today for television," said Jack Myers, president of Myers Communications, a Parsippany, N.J., consultant to the TV and ad industries.
Others agree that NewsTalk and USA Today would be an excellent blend, and that Multimedia's track record in TV syndication represents a strong opportunity to develop new TV shows based on Gannett properties.
"This gets Gannett into what's a very lucrative part of the programming business. Even though the talk show format is maturing, it's still going to be a very profitable business," said Michael Wolf, a partner and head of the entertainment and media practice at Booz Allen & Hamilton, New York.
Others, however, underline the increased concentration the merger brings Gannett in its core newspaper and TV station businesses.
Assuming regulators approve the deal by yearend and follow through on plans to ease the limits on the number of TV stations that can be owned by a single company, Gannett will pick up 10 Multimedia TV stations, bringing its coverage of U.S. TV homes up to 14%.
Gannett also will pick up Multimedia's newspapers, including several dailies in booming Sunbelt markets, that will boost Gannett's total daily newspaper circulation to more than 6.4 million.