Toronto Star perpetuates fallacy of NOW's 25k circulationHere's a priceless incident of one dying newspaper looking down over the grave of its practically deceased competitor. Freelance writer H.G. Watson fails to challenge the provably false claim that NOW is distributing 25,000 print copies, overlooks the portentous Kirk MacDonald-TorStar connection, and quotes MacDonald without using the adjectives "absurd" and "buffoonish." I love the new information that Wei Lin, holder of defaulted loans, is out there looking for a buyer. It's got to be worth at least a solid five minutes of his time. Vox Media still not returning your calls, buddy? Now magazine is down to a handful of staff and its owners have gone bankrupt. Is this the end of the alt-weekly?
Media Central, which owns Now, filed for bankruptcy in March and its debt holders are trying to sell the magazine — but there’s no buyer yet. By H.G. Watson
Special to the Star Wed., June 15, 2022 When Now magazine launched in 1981, co-founders Michael Hollett and Alice Klein had a vision: to develop a media outlet that had the ability to change Toronto for the better.
At its height, the free alternative newsweekly circulated more than 60,000 copies. The magazine was the go-to place for Torontonians who wanted to read progressive local news, learn about new bands and find concert and movie listings. CBC radio host Matt Galloway and Toronto International Film Festival CEO Cameron Bailey worked there early in their careers, as did many Toronto writers, artists and photographers.
“I believe Now has, at times, been a very vital part of Toronto’s media landscape and an important part of the city,” said Hollett, who left Now in 2016.
Today, Now magazine is circulating less than half that a month. Its website is updated daily.
The COVID-19 pandemic exacerbated an already tough financial position, because of declines in classified and retail ad sales. The editorial team is down to a handful of people. Many former and current staff members are owed weeks of back pay. Media Central Corp., which owns Now, filed for bankruptcy in March, and its debt holders are trying to sell the magazine.
Since the 2008 recession, print news publications have struggled to maintain revenues. More people read news online, where ad sales pale in comparison to the prices once commanded by print. “The publication is no stranger to financial crisis,” said Klein in an email, adding the company had experienced years of financial losses.
In 2019, Now’s union, Unifor 87-M, and Klein negotiated a 15 per cent pay decrease for employees that would be topped up by employment insurance to help keep the magazine going.
The Toronto Star spoke to three former staffers who described a newsroom dedicated to Now’s vision as a free progressive arts and news alternative weekly for the city, and who were willing to keep working at reduced pay.
“People are loyal to the legacy,” said one former longtime staffer. For many, it was exciting to work on a paper that was not only highly regarded in Toronto’s arts community, but was also reporting on important social justice issues in the city.
“The paper used to mean something,” said another former employee. “And we were doing good work.”
In 2017, Klein hired Kirk MacDonald as a consultant to help run the business side of Now, focusing on general business management, including increasing ad sales and digital transformation. Though he never had an official job title, he was involved enough that Klein asked him to find a buyer for Now.
MacDonald eventually found a buyer in Media Central, and the sale went through in 2019. Klein hoped that new capital and deeper tech resources would lead to real renewal for Now magazine. She also used the funds from the sale to pay off debts she had personally incurred to keep the publication going.
Described on its website as media for the “free generation,” Media Central positioned itself as an innovative disrupter.
When Media Central bought Now, then CEO Brian Kalish announced plans to buy hundreds more alternative weeklies that would be united under the Media Central brand. On March 2, 2020, the company bought the Georgia Straight, an independent alternative news weekly based in Vancouver. To fund the sale, Media Central issued debentures to raise capital.
“It was a very smart move at the time, in my opinion, to buy both those assets,” said MacDonald, who after the sale of Now joined Media Central as senior vice-president of revenue and operations. He was named president in March 2020.
Before the pandemic, the combined 2019 revenues of the Georgia Straight and Now were about $7.6 million. (However, Now was operating at a loss in its last fiscal year before it sold to Media Central.) “That was supposed to be the start of two building blocks of whatever the future expansion was,” MacDonald said.
But within weeks, the pandemic hit North America. Advertising, the alternative newsweeklies’ primary revenue source, dried up as COVID-19 caused lockdowns. A Nieman Journalism Lab article described the situation as “total annihilation” for alt-weeklies across North America.
The two publications’ ad revenue dropped to $1.5 million in 2020. In the midst of this economic turmoil, Media Central announced it would be merging editorial, marketing and sales, and refocusing editorial at Now Magazine and the Straight on health, education, finance and esports, eliminating its traditional focus on arts and venues.
The announcement caused a massive furor online. It removed the traditional watertight wall between editorial and sales, meant to ensure journalism is unswayed by ad dollars. And it took Now away from what it does best: arts coverage.
CEO Kalish eventually walked the statement back, saying in an open letter to readers that “arts and culture have been the cornerstone of Now and the Straight from day one, and they will continue to remain important facets of our publications.”
MacDonald said that after Kalish left Media Central in 2020, editorial control was decentralized and direction was handed back to the editors-in-chief of each publication.
For staffers, however, all these decisions were still a cause for concern. There was a sense that the new management did not really understand what the magazine was. The pandemic also derailed plans for Now union members who were still fighting for their pay to return to normal levels. Eventually, a number of staff accepted voluntary temporary layoffs or left the company for new employment. After all of this, the pre-pandemic newsroom that had between 15 and 17 people was shaved down to just five in editorial, including acting editor-in-chief Radheyan Simonpillai and editor and writer Glenn Sumi.
By the fall of 2021, staff noticed that their pay, which usually arrived promptly on Thursdays, had begun to come late. Sometimes it was just a few hours; other times, it was off by a day or more. Concerns were also raised by freelance writers and photographers who had not been paid for their work, in some cases dating back to 2019. By February 2022, pay ceased entirely.
There simply was very little money. MacDonald said the company did not receive grants it was hoping for, and it no longer was eligible for COVID-19 wage subsidies. As well, ad sales were low in the winter, as they traditionally are.
In March 2022, Media Central defaulted on a $1.1-million payment owed to its debenture holders. Later that month, it entered bankruptcy and was dissolved. The same month, Simonpillai announced that Now would only be printing monthly for the time being.
Both Now and the Georgia Straight are still able to operate as independent entities — however, because they are assets of a now bankrupt company, the debenture holders are trying to sell them off to recoup their losses.
“There are interested parties,” said Wei Lin, the senior debenture holder and partner at Lightheart Management Partners. “But the process is still ongoing.”
MacDonald believes, despite the challenging financial situation, that both properties are attractive for potential buyers. “Their brand awareness combined expands 93 years,” he said. “You cannot buy brand awareness on the internet.”
MacDonald and Simonpillai are dedicated to keeping Now going in the meantime. MacDonald said current and temporarily laid-off staff have begun to receive back pay. Mark Stockton, a union staff representative for Unifor Local 87-M, confirmed the employer has committed to a payment plan. “What we’d like to see is this to never happen again,” he said.
This month, Now released a special 56-page summer print edition with a run of 25,000 copies.
“We believe that we are an essential resource for the arts community in Toronto,” Simonpillai said. “That’s what we’re passionate about. That’s what we want to deliver on. We’re still sticking around to be that for the Toronto scene.”
It’s possible that they will find a deep-pocketed buyer willing to invest in and rebuild Now. But without that, it may disappear entirely from Toronto’s streets.
It’s been difficult for former staffers to watch it struggle.
“We never had any shortage of ideas or creativity,” said one former employee. “I would love to see it continue … I still think that alt-weeklies play an important role.”
“I just hope that the arts community and the progressive community in Toronto don’t, in any way, see this as a reflection on them or their importance to the city,” said co-founder Hollett. “Because it’s not — it’s simply a reflection, unfortunately, of some bad editorial and business decisions that were made.”