La Presse to become a non-profit in bid for survival in news business

MONTREAL One of Canada’s largest newspapers will become a nonprofit, allowing it to receive donations and, it hopes, support from the federal government.

Under the plan announced Tuesday, La Presse will become a not-for-profit trust. The paper’s current owners, Power Corp., will give it $50 million to help ease the transition and then back away.

“It opens the door to different forms of revenue that we didn’t have before,” said Pierre-Elliott Levasseur, the president of La Presse. “The federal government was very clear with the industry that they understand the problems that written media today faces, the complexity of competing with Google and Facebook. They understand the important contribution that written media plays in a healthy democracy but they’re not willing to help newspapers that are held by rich families or rich companies.”

In February’s budget, Ottawa said it will be looking at new models to enable private giving and philanthropic support for nonprofit news organizations.

But Levasseur said he hopes it will go further than that. “If we’re unable to get support from the federal government, it’s going to be difficult to maintain and continue to play the role that we’ve historically played in this province,” he said.

Being an independent non-profit will also allow the 130-year-old paper to raise money through donations, something that Levasseur said wasn’t really possible when it was owned by Power Corp., a company controlled by the wealthy Desmarais family.

“We’re opening the door to donations from large companies, from large donors as well as average citizens that understand the role La Press plays in society,” he said.

The paper will also benefit from a Quebec tax credit for news organizations and it will continue to sell advertising, he said.

For readers — and employees — of La Presse, little should change, Levasseur said.

No layoffs are associated with the plan, nor are there plans to begin charging readers or to reintroduce a print edition. Power Corp. will remain responsible for all pension commitments accrued before the new structure is established. The non-profit will take over new pension commitments going forward.

La Presse, the most-read Frenchlanguage daily newspaper in Canada, stopped publishing a weekday print edition in 2016; it stopped printing a Saturday print edition at the end of 2017. It has focused on a free tablet application, La Presse+, as well as its free-to-read website.

As of the first quarter of 2017, it had the fourth-largest digital reach of any newspaper in Canada in either language, according to Vividata.

While both the paper and the union that represents its staff have characterized the switch to digital as a success, La Presse’s financial situation is rather opaque. Power Corp. reports earnings from La Presse’s parent firm as part of single “other” category, which includes a number of different holdings.

Edward Greenspon, the president and CEO of the Public Policy Forum, an Ottawa-based thinktank, said he expects to see more news organizations experiment with non-profit business models and other models that include non-profit elements.

“I think we’re in a period where even exceptionally smart business people, like the Desmarais family, are finding that they can’t figure their way around the obstacles in the face of the industry, at least on a short-term basis,” he said.

But Greenspon, the former editor-in-chief of The Globe and Mail — which recently launched a foundation to support some aspects of its journalism — said that while non-profit status may buy papers some time, it’s not a solution on its own.

“Is it a viable plan for newspapers to become sustainable? Not in and of itself, even a non-profit can’t be a perennial loser,” he said.

There is, however, more interest in supporting journalism from the federal government.

“I think the federal government is willing to go further, but I don’t think they know what further looks like,” Greenspon said, adding that he doesn’t think the federal government will give money to companies that don’t have a plan to move forward into the future.