USA Today Publisher Larry Kramer Steps Down As Gannett Spinoff Looms
Move Comes Weeks Before Company's Split Date of June 29
Larry Kramer, publisher and president of USA Today since 2012, is leaving the newspaper and joining the board of directors of the new Gannett, the company announced today.
Mr. Kramer's departure comes as Gannett, owner of 82 daily newspapers including USA Today as well as 46 local TV stations, prepares to split into two separate publicly traded companies: the publishing arm remains Gannett and the TV properties become TEGNA.
Both companies will begin trading on the New York Stock Exchange starting June 29.
The publishing business is the largest source of revenue for Gannett, but it's in decline (unlike the TV stations) as readers abandon print for digital and advertisers follow with their budgets. During the first quarter of 2014, publishing revenue fell 9% year-over-year.
Amid this rapid shift in the publishing business, USA Today Editor-in-Chief David Callaway said the newspaper's daily print edition could go away in the next five or six years. He was responding to a question during a panel on the future of media at Internet Week in New York last month.
There's been a recent uptick in editors leaving USA Today, taking buyout packages ahead of the spinoff. Mr. Callaway, however, told Capital New York he planned to stay wiith the paper.
Meanwhile, the new boss at Gannett once it spins off will be Robert Dickey, currently the president of Gannett U.S. Community Publishing. Grace Martore, now the president and CEO of Gannett, will hold the same title at TEGNA after the spin off.
Gannett is currently looking for a chief content officer, the company said Monday in a note to staff announcing Mr. Kramer's exit.
The looming separation at Gannett is part of a broader trend in the media world in which large media companies are splitting off their under-performing print properties from their more lucrative TV holdings. For instance, Rupert Murdoch separated his newspapers, which include The Wall Street Journal and New York Post, from his Fox TV networks and movie studio, creating News Corp. (print) and 21st Century Fox (TV and film). Time Warner spun off Time Inc., the nation's largest magazine publisher, into its own publicly traded company last June. And last August, Tribune Company split into Tribune Media, which owns TV stations, and Tribune Publishing, owner of daily newspapers like The Los Angeles Times and Chicago Tribune.
Gannett, unlike Time Inc., will be "virtually debt free" at the time of the spinoff, the company said. Time Inc. was saddled with $1.3 billion in debt from Time Warner when it began trading publicly. TEGNA, instead, will take on Gannett's existing debt of $4.4 billion.