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Expand chart
Data: UNC Center for Innovation and Sustainability in Local Media; Chart: Andrew Witherspoon/Axios

Gannett Co, the largest newspaper owner by circulation in the U.S., and its rival GateHouse Media, the largest newspaper owner by number of papers in the U.S., are currently in talks to merge, The Wall Street Journal reports.

Why it matters: The combination of the two publishing powerhouses means that a single company would own 1 in every 6 newspapers in the United States.

Yes, but: For an industry facing near-collapse, consolidation is still considered a better alternative than closures.

  • There's been a net loss since 2004 of almost 1,800 local newspapers. About 70% (1,300 papers) that closed or merged were in metro areas (suburbs).

Details: GateHouse, which is owned by New Media Investment Group Inc, has a reputation for slashing costs and consolidating resources.

  • Industry analysts say they expect cost synergies between the two companies to come from sales and operational roles and point to examples of ways the newspaper giant has consolidated resource hubs around the country, like GateHouse's Center for News and Design in Texas.

Between the lines: Gannett may have finally found a friendly suitor after blocking a hostile takeover attempt from New York hedge fund Alden Global Capital in May. Another suspected takeover of Tribune, by McClatchy, also derailed last winter.

Be smart: Unlike some recent mergers in broadcast and telecom — also legacy industries upended by technology — experts don't believe that the deal would cause any regulatory concerns, because the companies don't really overlap in key markets.

  • "People get excited about consolidation among media properties, but I think these two companies still represent a small percentage of news publishing and I don't see in them any true antitrust concerns," says David Chavern, CEO of the News Media Alliance, a newspaper trade association that represents thousands of papers.

The big picture: Consolidation in the newspaper industry is rapidly increasing as consumers and advertisers flock to digital alternatives. Large, publicly-traded, newspaper holding groups are consolidating most of the power.

  • For example, a study from UNC's School of Media and Journalism last year found newspaper sales and closures/mergers via the 7 largest newspaper owners have increased over the past 5 years.

The bottom line: "I think this is part of a continuation of local news publishers trying to get to an economically sustainable business model," says Chavern.

Go deeper:

Go deeper

Updated 47 mins ago - Health

U.K. first nation to clear Pfizer coronavirus vaccine for mass rollout

A health care worker during the phase 3 COVID-19 vaccine trial by the Pfizer and BioNTech in Ankara, Turkey, in October. Photo: Dogukan Keskinkilic/Anadolu Agency via Getty Images

The United Kingdom's government announced Wednesday it's approved Pfizer-BioNTech's COVID-19 vaccine, which "will be made available across the U.K. from next week."

Why it matters: The U.K. has beaten the U.S. to become the first Western country to give emergency approval for a vaccine that's found to be 95% effective with no serious side effects against a virus that's killed nearly 1.5 million people globally.

3 hours ago - World

NYT: Biden won't immediately remove U.S. tariffs on China

President-elect Joe Biden during an event in Wilmington, Delaware, on Tuesday. Photo: Alex Wong/Getty Images

President Trump's 25% tariffs imposed on China under the phase one trade deal will remain in place at the start of the new administration, President-elect Biden said in an interview with the New York Times published early Wednesday.

Details: "I'm not going to make any immediate moves, and the same applies to the tariffs," Biden said. He plans to conduct a full review of the current U.S. policy on China and speak with key allies in Asia and Europe to "develop a coherent strategy," he said.

Trump threatens to veto Defense spending bill over social media shield

Photo: Erin Schaff - Pool/Getty Images

President Trump tweeted Tuesday a threat to veto a must-pass end-of-year $740 billion bill defense-spending authorization bill unless Congress repeals a federal law that protects social media sites from legal liability.

Why it matters: Trump's attempt to get Congress to end the tech industry protections under Section 230 of the Communications Decency Act is the latest escalation in his war on tech giants over what he and some other Republicans perceive as bias against conservatives.

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