What’s at stake in the latest Journal Register bankruptcy

Matt DeRienzo

This article also appears at the Nieman Journalism Lab.

In the spring of 2009, when I began researching what would become a book about online community journalism, I couldn’t have found a better foil than the New Haven Register.

Owned by the bankrupt Journal Register Co. (JRC), the daily was moribund and mediocre, its disconnect from the community symbolized by its location: a gigantic converted shirt factory, partly surrounded by barbed wire, on the outskirts of the city next to Interstate 95. The contrast with the New Haven Independent, a nonprofit, online-only startup that is the focus of my book, couldn’t have been more stark.

Three years later, when I turned in my manuscript, things had changed considerably. JRC was out of bankruptcy. Its chief executive, John Paton, was winning industry plaudits for his “Digital First” strategy of accelerating the transformation from print to online. The New Haven Register had a new, young, progressive editor, Matt DeRienzo. And JRC had outsourced printing to the Hartford Courant as DeRienzo had begun preparing to move his staff to a yet-to-be-determined location in the downtown. New Haven, a poor, largely minority city of about 130,000 people, was suddenly home to two of the country’s most closely watched experiments in reinventing local journalism. (My book on all of this, “The Wired City,” will be published by the University of Massachusetts in 2013.)

So I was shocked on Wednesday when Jim Romenesko reported that JRC was once again entering bankruptcy. As Paton explained it on his blog, the idea is to get the company out from under the legacy costs that it took on when the newspaper business was a lot larger and more profitable than it is today: debt; long-term leases on buildings it no longer needs; and pension obligations. The strategy is to take advantage of Chapter 11 in order to reduce JRC’s cost structure and re-emerge from bankruptcy in a matter of months.

The pension piece has been the subject of considerable consternation on Twitter and elsewhere, as it raised the specter of out-of-state investors (JRC is headquartered in suburban Philadelphia) taking away from loyal employees what is rightfully theirs. DeRienzo countered by pointing out that pensions are guaranteed by the federal government. “No one’s retirement is at risk,” he wrote.

There’s no question that guaranteed pensions are largely a thing of the past in the private sector, with defined benefits having given way some years ago to the era of the 401(k). And JRC is not the only newspaper company with pension problems. In 2009, the New York Times Co. nearly reached a deal to sell the Boston Globe that would reportedly have brought in less cash ($35 million) than the Globe’s future pension obligations ($59 million), which prospective buyers were asked to assume.

In other words, if you were going to start any private enterprise from scratch, you would almost certainly not include pensions as one of the benefits that you would offer your employees. And I have little trouble believing that JRC’s pension system is weighing the company down.

On the other hand, it seems to me that JRC may soon face a “Where’s the beef?” moment. Paton’s tireless advocacy of Digital First has gotten a lot of attention and praise — deservedly so. At some point, though, Paton has to deliver real improvements both to the journalism of JRC’s news organizations and to the bottom line.

I think Paton and DeRienzo have the right values and the right motives. I’m rooting for them. Fundamentally, though, we are talking about trying to effect change from the top down. Corporate chain ownership has been a disaster for community journalism. I’d rather my paper be owned by a good chain than a bad one. But neither is an adequate substitute for local ownership — and yes, I realize that’s no panacea, either.

As the Nieman Journalism Lab’s Joshua Benton points out, this may be Paton’s last, best chance to remake JRC exactly along the lines that he envisions — truly a new start without the dead weight of his predecessors’ poor decisions dragging him down. I’m eager to see what he’ll do with that opportunity.

Beware the “Romenesko Effect”

Jim Romenesko

Time was when a young journalist could recover from a lapse in judgment, learn from his or her mistake and get back on the career ladder. As NPR’s Nina Totenberg once said about having been fired for plagiarism when she was a 28-year-old reporter for the National Observer, “I have a strong feeling that a young reporter is entitled to one mistake and to have the holy bejeezus scared out of her to never do it again.”

Those days are long gone. Whereas well-connected miscreants such as Mike Barnicle seem never to go away, young reporters caught stealing are briefly held up to national ridicule and then banished into some black hole. My friend Mark Jurkowitz calls it the “Romenesko Effect,” in tribute to Jim Romenesko’s compulsively read media-news site at Poynter.org.

The latest example is a reporter for Connecticut’s Middletown Press named Walt Gogolya, who left the paper after he was caught ripping off large sections of a story from the local Patch.com site. (I wouldn’t name Gogolya except that Romenesko writer Charles Apple — Romenesko himself is heading toward retirement — already has.)

The article falls into the news-of-the-weird category, as it involves the arrest of a man for field-dressing a deer in a parking lot. Those details may have made it harder for Gogolya to get away with his thievery. Worse for him is that the Press is owned by the Journal Register Co., which, under CEO John Paton and Connecticut regional editor Matt DeRienzo, has embarked on a public campaign of maximum transparency. Gogolya was not quietly asked to leave — he was thoroughly exposed in this editor’s note from DeRienzo. From there it was but a short hop to Romenesko and industry-wide humiliation.

I’m not entirely sure what to think about this. I think DeRienzo deserves credit for being open with his readers about what happened and how the company responded. I also did some poking around the tubes and discovered that Gogolya is not some kid fresh out of J-school. Nor do I have a problem with Romenesko airing such matters — quite the opposite, in fact. Yet these good decisions, defensible in themselves, may add up to something that’s disproportionate to the offense. Not that this is an excuse, but I’d be curious to know what Gogolya’s workload was like. Those are not easy jobs. But guess what? There’s no going back.

Essentially, young journalists need to know this: the world in which Nina Totenberg began her career no longer exists, and hasn’t for some time. When it comes to journalism’s two cardinal sins, plagiarism and fabrication, it’s now one strike and you’re out.

I think it also means that those of us who teach journalism need to be as diligent about these matters as we possibly can. Far better to suffer an “F” and a trip to the student disciplinary board at 20 than to have your career ended just as you’re getting started.

What does “Digital First” really mean?

New Haven’s final pre-primary mayoral debate in what has been a spirited campaign was held Thursday — and the New Haven Register, the Journal Register Co.’s flagship, didn’t bother to cover it. Instead, the Register linked to a story in the New Haven Independent, a nonprofit news site.

It was a curious decision, to say the least, and it comes at a time when JRC chief executive John Paton is the toast of the newspaper business for espousing a “Digital First” strategy.

In late August I had a chance to interview Matt DeRienzo, the new editor of the Register (as well as of two other Connecticut dailies). He struck me as a nice guy and genuinely committed to Paton’s goal of reinventing the daily-newspaper business online. But even though this particular debate was not as high-profile as previous ones, it still seems strange to outsource a story about an important city election to another news organization.

Among the Journal Register Co.’s high-profile advisers is Jeff Jarvis, well known for saying, “Do what you do best and link to the rest.” Good advice. But if covering a mayoral debate is not among the things a city newspaper does best, then I think we have to ask why.

Maybe someone got sick — though I’d hate to think the Register is so thinly staffed that no one else was available to send into battle.

Update. Paton responds via Twitter: “NHR doesn’t cover one event and you think that calls into question Digital First as a strategy? Ridiculous.”

Update II. DeRienzo responds in the comments. And makes some good points.