(CANADA) – Nordstar, the parent company of the Toronto Star and other newspapers, revealed its intention to seek bankruptcy protection for its Metroland Media Group division, which owns more than 70 local newspapers, resulting in the elimination of over 600 jobs.
The move is part of a broader restructuring plan by Nordstar. Metroland Media Group, known for its community newspapers distributed with advertising flyers, will exit the flyer business entirely and transition to a digital-only format.
This decision reflects the impact of unsustainable financial losses attributed to changing consumer and advertiser preferences, exacerbated by the dominance of digital tech giants in Canada’s advertising revenue landscape.
Financial losses and digital dominance
The decline of the print and flyer distribution business was further accelerated by the COVID-19 pandemic and reduced flyer usage by both readers and advertisers.
As a result, 605 jobs, representing approximately 60% of the total workforce, will be lost.
Metroland’s community publications will shift to a digital-only model, while its six daily newspapers, including the Hamilton Spectator, Peterborough Examiner, St. Catharines Standard, Niagara Falls Review, Welland Tribune, and the Waterloo Region Record, will continue to be available in both print and online formats.
These developments come after failed merger discussions earlier this year between NordStar and Postmedia.
The talks aimed to explore a potential merger between Postmedia and Metroland Media Group, with the Toronto Star operating under a new entity.
The media industry has faced significant challenges as digital giants like Google and Meta (formerly Facebook) have captured a substantial portion of advertising revenue.
In response to the shifting landscape, the Canadian government recently passed the Online News Act, which will compel digital giants to pay media outlets for the use of their content on their platforms.
Meta and Google have announced plans to block content from Canadian news publishers on their services before the law takes effect.