In 1995, Dave Price, Jim Pavelich and Dave Danforth (who later split in a harsh dispute) launched the Palo Alto Daily News, a free daily tabloid, which grew to include papers in four other Bay Area editions. (A fifth, the Los Gatos Daily News, ceased publishing in September.)
A decade later, in February 2005, Knight Ridder, then-owner of the Mercury News and the second largest newspaper chain in America, purchased the Daily News Group.
Both the Mercury's Palo Alto once-bustling bureau and the Palo Alto Daily News remained, but Mercury News reporters became scarce, with the larger paper increasingly running Daily News accounts of local news and events.
In March 2006, Knight Ridder, under internal pressure from stockholders, imploded and was sold to the Sacramento-based McClatchy Company, which in turn sold 12 of its properties to Dean Singleton's MediaNews -- including the Mercury and the Daily News Group. The deal was finalized in August 2006.
Since then, the Mercury News has undergone several rounds of layoffs. About 100 employees were let go in December 2006, followed by 60 editorial-staff members this summer. The Mercury's Palo Alto bureau on University Avenue closed (it was unoccupied when the Walgreens fire broke out in July). Meanwhile the Palo Alto Daily News announced plans in April to move out of Palo Alto to an office in eastern Menlo Park along U.S. Highway 101. That move hasn't yet materialized yet.
Despite the increasing influence of MediaNews as corporate parent of the Mercury News and the Palo Alto Daily News, Palo Alto leaders have mixed opinions about how media mergers have affected coverage of local affairs.
"I don't think the consolidation has had any effect at all," said Councilman John Barton, a local architect and former school board member.
Barton said he is troubled, however, by an increased journalistic interest in "muckraking ... finding out the salacious details rather than the good details."
The Weekly and the Daily News are both guilty, he said.
"The news is not very broad and not very thoughtful," Barton said, noting that Daily News stories run in the Mercury News lack context in the region.
But Councilwoman Dena Mossar disagrees sharply.
"News coverage in the South Bay has gotten noticeably worse," she said.
"All of the media has gotten so focused on reporting controversy that facts are hard to find. I find that a huge disappointment."
Several local residents expressed disappointment and resignation over the reliance of the Mercury on Daily News stories.
"The San Jose Mercury seems to be nearly word for word what is reported in the Palo Alto Daily," local developer Jim Baer said. "My sense is for Palo Alto-centric readers that may lessen interest in the San Jose Mercury."
"It doesn't add more to the conversation," said Bob Holmgren, a Menlo Park photographer who formerly blogged on local media in the now-defunct "Burning Squirrel Report."
"It seems like everybody puts out the same product," Holmgren said.
The loss of Mercury News reporters in Palo Alto has "diminished the depth and perspective of articles," School-board member Mandy Lowell said.
With fewer reporters, the real losers are poorer communities such as East Palo Alto, she said, recalling an effort by a Mercury News reporter that uncovered massive misspending in East Palo Alto schools.
Palo Altans, fans of the New York Times and expert Internet navigators, are "very well-informed" despite the cutbacks and consolidations, Lowell said.
Midtown neighborhood leader Annette Glanckopf said she was also unaffected by the recent mergers.
"The question is how many people even read the newspaper?" Glanckopf asked.
Elaine Meyer, a University South neighborhood leader, agrees that many Palo Altans don't know what's happening locally.
"I put out an e-mail newsletter, and I get a lot of praise for covering things they wouldn't otherwise know about," Meyer said.
Palo Alto Councilwoman LaDoris Cordell, known for her aversion to the Daily News, said the paper has improved under corporate ownership.
But the opposite is not true for the Mercury, she said.
"I call it a news-letter," Cordell said.
Paul Losch, Parks and Recreation Commission chairman and avowed media junkie, said Palo Alto is lucky to have two papers.
But the Mercury News is "going through a bit of an identity crisis," he said.
And no one covers Palo Alto's bustling business community, he said.
Jim Bettinger, a longtime journalist who leads the Knight Fellowship program at Stanford, said the overall trend is negative.
"You can't separate quantity from quality," he said, noting that the slashing of staff resulted in less complete coverage.
But another longtime journalist and Palo Altan, Harry Press, has a mixed view.
"The quality is just as good" in many stories but the cutbacks have reduced the number and breadth of articles, he said.
Few Palo Altans were willing to venture a prediction of the future for the region's media.
Industry expert Bettinger said he's been wrong before, noting he didn't predict the role the Palo Alto Weekly would come to play in the community when it was founded in the fall of 1979.
"I really don't know" what's next, he said.