4. But there are special circumstances in the Canadian case. PostMedia proposal is here:https://www.buzzfeed.com/paulmcleod/canadas-largest-newspaper-chain-wants-ottawa-subsidize-newsp?utm_term=.jveNydEbXN#.eq2Gyxl4zG …
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Replying to @HeerJeet
5. The vast majority of Canadian newspapers are owned by one company (PostMedia), itself owned by an American hedge fund.
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Replying to @HeerJeet
6. The current problems of PostMedia are not just the generic ones of newspaper industry but also due to a series of bad business decisions
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Replying to @HeerJeet
7. In a nutshell: Postmedia's problems are an onerous debt structure so that even its profitable papers are being leeched to service debt.
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Replying to @HeerJeet
8. Because Canadian newspaper industry so highly concentrated in Postmedia, we have a too big to fail problem & moral hazard problem.
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Replying to @HeerJeet
9. In theory, proposals would benefit all Canadian newspapers. But because of concentration, it's a de facto bailout of one company.
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Replying to @HeerJeet
10. Proposal put forward by Postmedia amounts to asking Canadian state to shore up failing company from years of bad decisions. Moral hazard
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Replying to @HeerJeet
11. So: whatever merits in ad hoc subsidies Postmedia wants, Canadian gov't should think about longer range models of newspaper viability
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Replying to @HeerJeet
12. A longer range model would have industry with more local papers (ironically many Postmedia outlets make money, but tied down by debt).
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Replying to @HeerJeet
So they're tied down by debt, like many other for-profit companies.
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Well local papers didn't incur debts, they came when as part of consolidation.
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