McCorkindale Ready to Go Shopping

By: Carl Sullivan Rather than accept the growth of free tabloids as inevitable, newspapers must do a better job convincing people why they should pay for traditional dailies, said Douglas H. McCorkindale, chairman, president, and CEO of Gannett Co. Inc., during a rare media interview with E&P last week. "It's a very, very, valuable product, and quite honestly, very underpriced compared to what the reader is receiving," he said. "We seem to be afraid to tell people that."

Gannett, with 100 U.S. dailies, has been out front in developing spinoff publications aimed at young people, launching three free weeklies in the past year and planning several more. McCorkindale said that while free papers serve an important reader and advertiser purpose, they won't supplant the paid daily.

The CEO, who has earned an acquisition-savvy reputation on Wall Street, said that the chance of cross-media ownership rules changing and the likelihood of continued industry consolidation led the Gannett board of directors in July to extend his tenure until 2006. His previous contract would have ended in June 2004, when he reaches age 65, so the board's action tabled the subject of succession.

McCorkindale, who has spent 32 years at Gannett, rising through the legal and financial sides, said he doubts the person named to follow him will come with a similar background: "There's nobody in Gannett management that looks like me, thank God ... but they all bring different talents to the table."

With the possible sale of Hollinger International Inc., Gannett could look at Hollinger's Chicago cluster or London Telegraph Group Limited to complement its U.K. properties. While McCorkindale didn't express interest in specific assets, he said, "Gannett is a ready, willing acquirer of media properties."

Gannett was widely viewed as a likely buyer for all of Freedom Communications Inc., but that company's board opted this fall to recapitalize rather than sell to an industry buyer. McCorkindale said he wasn't surprised by that outcome. "I think it was a little bit of a confused process from day one," he said. "Of course, we backed out of bidding for the whole thing before the end.

"I don't know how this is going to work out for the family," he continued. "I told the shareholders ... I thought recapitalization would result in a sale in three to five years from now, or major restructuring, but that was their choice, and we understand that."