Tronc Licenses Washington Post Publishing Platform

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The Tronc Inc. (NASDAQ: TRNC) transformation from a print and digital publishing company to one that is much more digital than print assumes it will use state of the art online products. Management says it will create some of these in-house. However, Tronc has gone outside to license a publishing platform from The Washington Post, recently given an improved lease on life by new owner Amazon.com Inc. (NASDAQ: AMZN) founder and billionaire Jeff Bezos.

According to the two companies:

Arc Publishing, The Washington Post’s fast-growing software-as-a-service business, has signed a technology partnership with tronc, Inc. to power digital publishing for its vast publishing portfolio, beginning with the Los Angeles Times.

The LA Times is without a doubt the Tronc flagship, the major paper in the nation’s second largest city.

Tronc CEO Justin Dearborn described the arrangement:

This partnership will provide us with the capabilities that our reporters need to deliver award-winning journalism across all platforms and new tools that allow our marketing partners to connect with our growing digital audience. We look forward to collaborating with The Washington Post on additional technology initiatives that benefit our readers and advertisers.

Arc Publishing was originally created to run the Post on a next-generation “content management system.” The Washington Post has gotten some modest-sized customers, the most well-known of which is the Globe and Mail, the Canadian daily. (The Alaska Dispatch News, the Anchorage newspaper is also a client.) Tronc is a prize of a customer, due to its size and visibility.

The decision dovetails with Tronc’s ambition to take content from among the nation’s largest newspapers, which include its properties the LA Times and Chicago Tribune, and move it online, enhanced with a huge amount of video and artificial intelligence created writing. The plan, although articulated differently, is along the line of those of other large chains, including Gannett Co. Inc. (NYSE: GCI) and McClatchy Co. (NYSE: MNI). It is an aspiration that is also part of the strategic plans of many magazine publishers.

As a means to achieve its goals, Tronc has split itself into two pieces. TroncM primarily houses the corporation’s print assets. TroncX is made up of its digital assets. TroncM revenue for the fourth quarter was $367 million, down 8%. TroncX revenue was $60 million, up 1%.

Wall Street has shown a level of support for Tronc’s plans, at least as compared to its public company competition. Its shares are flat this year and trade at $13. Shares of Gannett are down 21% to $8. McClatchy’s stock is off $25% to $10.60

With Tronc as a prized new client, The Washington Post might pick up some other large customers for Arc Publishing.