The American News Company was founded in 1864 by Sinclair Tousey (1815-1887). He was a wholesale bookseller and popular newspaper columnist, who wrote fervent editorials in favor of the abolition of slavery.
Newspaper distributing companies are not the same as newspaper syndicates, which provide editorial content, such as columns, features, foreign coverage, comic strips, and editorial cartoons to a network of affiliated newspapers. Newspaper distributors handled public sales, delivery, storage, promotion, pricing, and display of newspapers and periodicals, as well as small commodities, such as books, candies, cigars, cigarettes, and novelties.
ANC grew rapidly after the Civil War, when railroads introduced coast-to-coast rail service, which carried newspapers and periodicals as second-class bulk mail. ANC exploited this economical service by expanding their network to erect depots near every railroad station ahead of their competitors. By the end of the 19th century, ANC dominated national newsstand distribution. The company was a massive operation with hundreds of wholesale outlets and thousands of employees spread over a nationwide network of warehouses, cargo and freight handling subsidiaries. America's most powerful newspaper publishers joined Sinclair Tousey to form the Publishers Association of New York, which owned and operated ANC. The headquarters and executive offices of ANC was at 9 Park Place in Lower Manhattan, opposite City Hall.
In 1887 Sinclair Tousey died at the age of seventy-two, and was replaced as president by an another elderly board member of ANC, Henry Dexter (1812-1910).
In November of 1893 The American Newsman reported, "It is as the keeper of a thousand secrets involving the fortunes of publishers and authors that the American News Company surrounds its vast and intricate system with an atmosphere of mystery, so that few persons have any idea of the company's really astounding proportions. It has gradually absorbed the smaller organizations until it now embraces thirty-two powerful news companies, with an annual operating expense of $2,488,000 and an annual business of something like $18,000,000. This organization handles the bulk of the reading matter of the United States and supplies nearly nineteen thousand dealers."
In 1902 President Theodore Roosevelt began to champion the enforcement of anti-trust laws to break up industrial monopolies that subverted free enterprise, threatened national interests, and undermined democracy. In 1906 he challenged corruption in interstate railway commerce with the Hepburn Act to establish Federal control over railroad rates.
In 1910 the president of ANC, Henry Dexter, died at the age of ninety-eight, and was replaced by the company treasurer, Solomon W. Johnson (1830-1913).
In 1913 Solomon W. Johnson died at the age of eighty-three, and was replaced as the head of ANC by another company treasurer, Samuel Shipley Blood (1843-1934).
By the time of the Great War the Publishers Association that owned and operated the American News Company was dominated by William Randolph Hearst (1863-1951), a wealthy and powerful businessman who favored neutrality with Germany, a stance that became increasingly unpopular after Germany's savage siege of Antwerp, Belgium.
In 1918 William Randolph Hearst used ANC to promote his own interests above those of other newspaper publishers, such as Ralph Pulitzer (1879-1939) of The New York World and Ogden Reid (1882-1947) of The New York Tribune, who were reduced to pleading with their readers, by devoting significant advertising space to attack William Randolph Hearst as "Un-American." This public feud left the distinct impression that William Randolph Hearst was the dominant member of the Publishers Association that owned and operated ANC.
The May 1919 issue of Law & Labor featured an article entitled, "It Was Unlawful Under Anti Trust Laws For The American News Company To Agree With The Different Newspapers That It Would Make No Deliveries To Dealers Who Would Not Also Handle Hearst Papers." According to that report, "The big newspapers of NYC, who were defendants in this case, are distributed to newsdealers by ANC. This company is owned and operated by the Publishers Association of NY, of which all the newspapers are members. Included among these are the New York American and The Evening Journal, both of which are owned and operated by William Randolph Hearst. During the summer of 1918 some newsdealers refused to handle Hearst's newspapers on the ground that they were disloyal and so offensive to their customers that many of them refused to purchase any papers from stands that displayed Hearst papers." According to the opinion of the court, "The facts in the case can hardly be said to be in dispute. They clearly point to a combination or conspiracy on the part of the defendants to use the tremendous force of their united power to compel the plaintiff to regulate his business under the direction of the defendants at the hazard of depriving him of the supplies upon which his business depends, and thus to prevent him from competing with other such newsdealers as would transact and carry on their business under the conditions which the defendants should choose to prescribe. In this lies the essence of the case against the defendant. This joint action is in the highest degree arbitrary, coercive, and un-American. For the purpose of this motion, I am constrained to hold it to be prima facie an illegal invasion of the rights of the plaintiff."
To protect ANC from further anti-trust litigation William Randolph Hearst began a defensive scheme to disguise the company's monopoly by discretely establishing "rival" distribution companies, which appeared competitive, but were in fact headed by cooperative affiliates.
From this understandable urge of self-preservation, William Randolph Hearst set in motion a clandestine organization that changed the entire history of American publishing as well as the nation itself.
To organize these affiliated distribution companies William Randolph Hearst appointed a member of the Hearst Executive Council, Moe L. Annenberg, the founder of the Chicago Newsstand Distribution Company, who had earned a notorious reputation in Chicago during a circulation war of fire bombings, murders, and violent intimidation of news dealers, atrocities that had solidified Chicago's gangland culture.
On January 17, 1920 the Eighteenth Amendment took effect, which made the sale of alcohol a federal crime. Demand exceeded supply to such an outrageous extent that law enforcement was quickly overwhelmed. Politicians had intended to prohibit unwholesome behavior, but inadvertently generated a national syndicate of organized crime that controlled and coordinated the wholesale import, manufacture, storage, trucking and distribution of alcoholic beverages. Criminal gangs were suddenly involved in a wildly lucrative mass production industry on a scale that was previously unimaginable.
During the roaring twenties Moe L. Annenberg was affiliated with Teddy Epstein, Harry Donenfeld, Warren Angel, Paul Sampliner, Irving Manheimer, Maurice Silberkleit, and Martin Goodman, all of whom started independent distribution companies, such as Eastern Distributing, Kable News, PDC, IND, Mutual Magazines, and Leader News.
One of these supposed rivals to ANC was ID, Independent Distributors. That company was incorporated as a council of non-aligned distributors.
The most powerful member of this council of Independent Distributors was the S-M News Company. In 1919 two successful magazines, Popular Science and McCall's Magazine, left ANC to formed the Science & McCall Newsstand Company. After five years their service included material from so many other publishers that the company name had grown out of date, so it was changed to S-M News, and later became "Select Magazines."
On September 22, 1923 The New York Times reported on the settlement of a pressman's strike, and identified the members of the Publishers Association of New York, as William Randolph Hearst, Frank A. Munsey, Ralph Pulitzer, Adolph Ochs, Ogden Reid, Herbert Gunnison, John Harmon, J. M. Patterson, Henry Stoddard, R. F. Huntsman, C. Barsotti, and Felix Arnold.
On November 18, 1924 legal documents were registered in Albany, NY, by Warren A. Angel, Paul H. Sampliner and Morris U. Falter to charter a new incorporation called Eastern Distributing Corporation to handle sales of magazines and candy to newsstands. Morris Falter (1870-1935) was the uncle of Paul Sampliner (1898-1975).
In 1925 ANC left their original offices near City Hall and moved to their newly built headquarters in the massive American News Building at 131 Varick Street. This industrial building covers the entire west side of Varick Street, and extends from Dominick to Spring Street, and occupies one half of the entire city block east of Hudson Street.
In 1934 Samuel Shipley Blood died at the age of ninety-one, and was replaced at the head of ANC by the company treasurer, Harry Gould (1870-1939).
On April 28, 1934 the Federal Trade Commission brought charges against S-M News Company for conspiracy and unfair trade practices.
By 1936 financial troubles forced William Randolph Hearst to endure a court-ordered reorganization of his empire to satisfy debtors, after which he was removed from leadership of the Hearst Corporation, including his leadership of ANC. He was replaced by Hermann G. Place, Director of the International Paper Company and Vice-President of the Chase National Bank of the City of New York.
On May 13, 1936 New York Supreme Court issued an injunction order to stop Popular Publications from producing the pulp magazine Ace G-Man Stories in unfair competition with the similarly titled G-Men Magazine, produced by Beacon Magazines, Inc. It is interesting to consider the sworn statements from this case, which document the affiliation of ANC (Sheeran) with Eastern Distributing (Sampliner), IND (Sampliner), Kable News (Angel), and PDC (Manheimer). The plaintiff in the case was Ned Pines, president of Beacon Magazines, Inc., whose offices were at 22 West 48th Street. According to the plaintiff's sworn deposition, "I am also the publisher, under a trade name "Thrilling Group," of eleven other pulp magazines, as well as three smooth paper magazines, among which is the well-known College Humor. The total annual distribution of the twelve pulp magazines published under the name "Thrilling Group" is approximately eighteen million copies per year." This publisher's lawsuit was supported by affidavits submitted by four disinterested professionals - Warren A. Angel, Paul Sampliner, Joseph A. Sheeran (1880-1942), and Irving S. Manheimer.
The defendant in this case was Henry Steeger, owner of Popular Publications. During the appeal the defendant claimed, "These affidavits are totally unworthy of credence. This group of affiants appear in every infringement case in which the plaintiff or its affiliated corporations are involved." The defendant went on to list several previous examples. In 1929 Warren A. Angel furnished a supportive affidavit for Ned Pines in a lawsuit with Albert Publishing Co., producer of the pulp magazine Spy Stories, which subsequently ceased publication. After which Spy Stories and Spy Novels were produced by Magazine Publishers Inc, of which Warren A. Angel was listed as president. When those titles ceased publication Ned Pines produced Thrilling Spy Stories. In 1932 Sheeran and Sampliner furnished Ned Pines with supportive affidavits when he was sued for producing Thrilling Adventures in unfair competition with the similarly titled Adventure, one of the oldest and most respected pulps, which was produced by Butterick Publishing Co, which subsequently ceased publication. In 1934 in a lawsuit with Adventure House, Inc., Sheeran, Angel, Sampliner, and Manheimer furnished affidavits for Standard Magazines, Inc., a company which is affiliated with Ned Pines. In 1935 Ned Pines sued Popular Publications, which was again supported by affidavits from Sheeran, Angel, Sampliner and Manheimer. "It will be seen that no matter which side of the case the plaintiff happens to be on, the said individuals have been ever ready to assist. The connection between these gentlemen and the plaintiff is more fully described in the affidavit of Henry Steeger, submitted in opposition to the motion for a preliminary injunction." According to that document, dated April 27, 1936, Steeger stated that Sheeran was Assistant Vice President of the American News Company, which distributed most of Ned Pines publications, so Sheeran's interest in the outcome of the litigation was obvious. Furthermore his interest is all the more understandable when it is realized that Steeger used a rival distributor. Secondly, Warren A. Angel was Vice President of Kable News Company, which distributed Pine's magazine College Life, and was therefore directly interested in the outcome of the case. "Furthermore, Mr. Angel has played the role of professional affiant before. In the suit brought by Magazine Publishers, Inc., versus Albert Publishing Co., Inc. an affidavit by Mr. Angel appears among the papers on the application of Ned Pines for a preliminary injunction. Mr. Angel's affidavit is dated February 4, 1929. In it Mr. Angel states that he was then General Manager of Eastern Distribution Corporation, which outfit was then distributing the magazines of Mr. Pines in that action. After Eastern Distribution Corporation went into bankruptcy, Mr. Angel moved over to Kable News Company, which distributes Ned Pine's magazines. Apparently, Mr. Angel is ever-ready and willing to furnish affidavits to customers of the distributing company with which he happens to be connected at the time. Mr. Sampliner is a personal friend of Mr. Pines. He was one of the owners of Eastern Distributing Corporation mentioned above, the bankruptcy of which cost this defendant at least $30,000 (in unpaid revenues). Mr. Sampliner is a distributor of sex magazines." Furthermore, Henry Steeger says of Irving S. Manheimer, who is Secretary of Gernsback Publications, Inc., located at 99 Hudson Street, that his "interest in a competitor's magazine is too naive to be true. Undoubtedly his personal friendship with Mr. Pines explains his affidavit. He is Mr. Pines foreign distributor."
In 1939 Harry Gould died at the age of sixty-nine and was replaced at the head of ANC by the company treasurer, Michael A. Morrisey (1885-1952).
In 1939 Simon & Schuster published the first mass market pocket-sized paperbacks, which wwere called Pocket Books. Their phenomenal sales at newsstands revolutionized the publishing industry. By 1941 ANC was publishing their own affordable paperbacks for sale at newsstands, Avon Books. Eventually Avon also published the pulp magazines, Out Of This World Adventures and Ten-Story Fantasy. Avon also produced digest magazines, Murder Mystery Monthly, Modern Short Story Monthly, Avon Fantasy Reader, and Avon Science Fiction Reader. Avon also produced comic books, such as Jesse James, Wild Bill Hickcock, Slave Girl Comics, Eerie Comics, Strange Worlds,Space Comics, Space Detective, Police Line-Up, Parole Breakers, and Murderous Gangsters.
On September 29, 1950 Michael A. Morrisey retired as head of the American News Company. He was replaced by the company's vice president, Percy Douglas O'Connell (1895-1960).
In 1952 the Free Trade Commission announced anti-trust litigation against ANC
. Documents of that trial stated, "American News Company and Interborough News Company built up their business as a NYC wholesaler of magazines to such an extent that they handled the multifarious details affecting distribution to the retail outlets, such as stationery stores, street corner stands, pier stands, hotels and clubs, railroad and subway stations, there being around 7500 such outlets in the metropolitan area. This was an extensive and complicated undertaking, and the concentration of the wholesaling of the various products into the hands of these two distributors was in no small measure due to the significant fact that it was not practical for any single distributor, even with so substantial an output as Curtis or Hearst or S-M News Company, to furnish the clerical and delivery personnel and equipment needed to service the requirements of these thousands of retail outlets, except at prohibitive expense."
In 1955 eleven percent of the stock in ANC was acquired by an undisclosed group of investors, headed by Henry Garfinkle (1903-1983), who then replaced P. D. O'Connell to become President of the Board. Henry Garfinkle was the owner Garfield News Company, a member of the council of ID.
In 1956 the University of Illinois Press published Magazines In The Twentieth Century by Theodore Preston. According to his chapter on ANC, "Even before the national magazine appeared, the distribution of magazines to retail outlets was dominated by the American News Company, which in 1955 serviced some 95,000 dealers from more than 350 branch offices. Founded in 1864 to distribute periodicals to retailers, the American News soon branched into wholesaling stationery, books, toys, and eventually hundreds of other items; and to selling periodicals and foods on railroads. In 1872 its subsidiary, Railroad News Company, bought the Union News Company, also established in 1864 to sell reading matter and other merchandise to passengers on Commodore Vanderbilt's New York and Harlem Railroad. Meanwhile, American News expanded its network of branches across the United States and into Canada. The company practically monopolized the distribution of periodicals when the low-priced magazine appeared in the nineties, but at mid-century it had some competition from the few other distributing agencies, S-M News Company, and other organizations controlled by Curtis, Fawcett, and Hearst. In 1955 the activities of American News were manifold. Directly or through its subsidiaries, it not only imported and exported, wholesaled, and retailed newspapers, magazines, and books; it also operated newsstands, restaurants, lunchrooms, cafeterias, soda fountains, bakeries, coffee shops, tobacco shops, book shops, toy shops, drugstores, barber shops, parcel checking facilities, weighing and vending machines, ice and roller skating rinks. American News sold more than half of the total number and dollar value of magazines distributed throughout the United States by national independent distributors. It was the largest wholesaler of books in the world; through its book department it accounted for from 25 per cent to 35 per cent of the total sale of a popular best seller. Its foreign department handled wholesale distribution of periodicals in Central and South America, the West Indies, Newfoundland, Iceland, Spain, Portugal, Africa, Australia, New Zealand, Asia, and U.S. possessions. The largest wholly owned subsidiary of American News was the Union News Company, which operated concessions in hotels, transportation terminals, office buildings (including Rockefeller Center in New York), public parks, and golf courses in thirty-two states and the District of Columbia. Its system of newsstands made it the largest retailer of magazines in the world; its gross sales volume of magazines in 1950 was about $7,500,000. It had about 170 contracts giving it the exclusive concession to sell magazines in certain department stores, hotels, and transportation systems. Early in 1949, it acquired all of the restaurant business of the Savarins Company, which operated a chain of restaurants in New York City. Another subsidiary of American News was the International News Company, which by the thirties was the world's largest importer and exporter of reading matter. One of its functions was to stimulate interest abroad in American books and periodicals. It also distributed foreign magazines, newspapers, and books in the United States; before World War II, it handled the retail distribution in the United States of more than nine hundred foreign publications from all over the world. Still another wholly owned subsidiary was American Lending Library, which operated a system of lending libraries."
"In June, 1952, the Department of Justice, filing suit, under the Sherman Anti-trust Law, charged American News and Union News with monopolizing the distribution of magazines from publishers to news dealers through independent distributors. American News, according to the complaint, used its relations with Union News to obtain exclusive national distribution rights. Union News refused to sell magazines not handled by American unless the parent company consented, the government charged; it gave preferential display to periodicals for which American held exclusive national distribution rights. The action ended with a consent decree three years later. Under the consent decree, Union News would buy, display, and sell magazines solely on the basis of its own interest as a dealer in periodicals. American News would not claim that it could obtain preferential treatment in the sales of magazines by Union News. When Henry Garfinkle became president of American News in June, 1955, two months before the consent decree, he made a fundamental change in company policy. Garfinkle, who had quit school at thirteen to help support his family, had risen from news-boy to one of the largest newsstand concessionaires in New York City. Early in 1955 he and some 200 business associates began quietly buying up American News stock. By summer they had emerged with working control of the company and its subsidiary, Union News. Immediately on assuming the presidency, Garfinkle announced that American News was abandoning its traditional policy of handling magazines only if it had exclusive rights to national distribution. In the future, he said, the company would also distribute magazines locally or regionally without insisting on national distribution rights. In effect, then, the company sought to serve other distributing agencies in communities and areas in which they wished wholesale representation. Despite the basic changes in policy, however, Union News in early 1956 was still not selling a number of large-circulation magazines on its newsstands in such important terminals as Grand Central and Pennsylvania stations in New York City. Commuter trains to and from New York carried posters announcing that Union News stands did not stock magazines distributed by S-M News but that neighborhood dealers could supply them. Some newsstands carried other posters telling commuters that here was the last chance to buy certain magazines before the journey home. Following an agreement between S-M News and American News in March, however, Union News resumed handling the seventeen magazines it had barred from its stands."
In 1957 Henry Garfinkle instituted a disastrous reorganization of ANC that swiftly caused the complete collapse of the mammoth company. Repercussions from that industrial meltdown traumatized the American publishing industry and generated widespread misgivings about the ulterior business interests of Henry Garfinkle. When the dust had settled, ID was the nations' largest newsstand distributor, and S-M News wielded controlling interest of ID.
In 1959 the Hearst Corporation bought Avon Publications from ANC.
In 1969 Henry Garfinkle merged ANC with the Garfield New Company to form Ancorp National Services, the nation's largest newsstand retailer of periodicals.
Kable News Company was also purchased and merged with Ancorp Company, while the former owner of Kable News Company, Samuel J. Campbell, became an executive member of the Board of Directors.
In 1971 Ancorp National Services was sold to Rupert Murdoch, the Australian-born American media mogul, to form the world's second-largest media distribution company, News Corp and 21st Century Fox, despite the enlightened legislation of President Theodore Roosevelt to outlaw monopolistic industrial trusts that are bad for democracy, bad for the free-market, and threaten national interests.
© David Saunders 2016