Cablevision Systems Corp., led by C.E.O. James Dolan, reached a $650 million deal to buy the Long Island daily Newsday from Tribune Co.
Immediately after announcement, though, analysts questioned the purchase given the sorry state of the newspaper business. And critics pointed out Cablevision’s lack of expertise with print media.
“Murdoch knows newspapers,” David Joyce, an analyst for Miller Taback, told Newsday. “The Dolan family does not.’
The deal will allow Cablevision to share content from Newsday’s print and online outlets and cross promote Cablevision products.
Cablevision has over 3 million subscribers in the New York City area and also owns the cable networks AMC and IFC, while Newsday reached 1.5 readers daily.
But the deal is subject to regulatory approval, notes Reuters, because Cablevision is Long Island primary distributor of TV content. Now, as the sole publisher of television news, Cablevision’s acquisition of Newsday could draw antitrust scrutiny.
Critics also wondered how Dolan, owner of the New York Knicks and New York Rangers, will orchestrate Newsday coverage of the two sports franchises. How would Newsday, for example, have covered last summer high profile sexual harassment lawsuit against former Knicks coach Isiah Thomas and Dolan?
“If there is any overt attempt by the Dolans to control coverage, it will demonstrate that this deal is a total failure,” Howard Schneider, dean of the journalism school at Stony Brook University, told the New York Times.