News Corp. drops plans to sell Ottaway newspapers

NEW YORK—News Corp. has decided not to sell the community newspapers it acquired as part of its purchase last year of Wall Street Journal publisher Dow Jones & Co.

Several newspapers in the Ottaway group, including the Medford Mail Tribune in Southern Oregon, posted stories on their Web sites Tuesday saying Rupert Murdoch's News Corp. had informed the papers the sale was off.

A News Corp. spokeswoman referred queries to a Dow Jones spokesman who declined to comment.

News Corp., a global media conglomerate that owns Twentieth Century Fox, the Fox broadcast network and newspapers in the United Kingdom and Australia as well as the U.S., bought Dow Jones for $5 billion last December.

Shortly before closing the deal, News Corp. said it would explore selling Ottaway, which operates eight daily and 15 weekly newspapers in seven states, including in Massachusetts the Cape Cod Times, The Standard-Times of New Bedford and the Inquirer and Mirror on Nantucket Island.

Since then, valuations for newspaper companies have fallen amid an accelerating decline in advertising revenues due to weakness in the economy and a continued migration of ad dollars online.

Newspaper advertising plunged 12.9 percent in the first quarter of 2008 from the same period a year ago, led by a 24.9 percent dropoff in classified advertising revenue, according to the Newspaper Association of America, an industry group.