Tribune’s Antitrust Battle Highlights a Changing Media Landscape

The evolution in how people consume news is expected to figure heavily into a brewing antitrust battle over Tribune Publishing Co.’s bid to become a major media player in Southern California, according to The Wall Street Journal.

In an antitrust lawsuit, the U.S. Department of Justice says consumers and advertisers would be hurt by a $56 million cash deal that would give Tribune, which publishes the Los Angeles Times and San Diego Union-Tribune, control of practically every major newspaper in Southern California.

U.S. District Judge André Birotte Jr. in Los Angeles late Friday sided with the Justice Department and granted the government’s request for a temporary restraining order, putting the brakes on Tribune’s proposed purchase of Freedom Communications, the publisher of the Orange County Register and the Riverside Press-Enterprise.

Tribune, in defending its bid to acquire Freedom Communications out of bankruptcy, finds itself in the position of arguing something that publishers have been loath to admit: The rise of the Internet means consumers and advertisers have similarly good options besides print.

“The Internet has exploded with new news and information sites,” Tribune said in a Friday bankruptcy court filing. “For better or worse, the court and the government need only look at the phone in their pocket to understand that the trend [toward] digital content is accelerating.”

At stake in the battle between Tribune and federal antitrust regulators is the fate of Freedom Communications, the bankrupt publisher that Tribune is looking to acquire, as well as what it means to be a news organization in the digital age.

To win, Tribune must show that its newspapers can be reasonably substituted with anything from the BBC in London to Craigslist. For the government to win, it must show that there is no reasonable substitute for a local newspaper.

Time is of the essence. Freedom Communications is expected to run out of money on March 31 and must be sold before that date to avoid shutdown, although there are other bidders besides Tribune, albeit with lower offers, waiting in the wings.

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