Those of us who have followed the transition of newspapers from print to free digital and, now, to paid digital have long predicted that seven-day print will eventually morph into one weekend print edition supplemented by digital the rest of the week.
Last week the Portland Press Herald announced it would take a step in that direction, eliminating its Monday print edition starting in March. Like many papers, the Press Herald has been emphasizing paid digital, so a cutback on print should be seen as an inevitable next step rather than the beginning of the end.
Still, I was curious about the decision to cut print on Monday. Among those of us who follow such things, the speculation usually involves eliminating the Saturday paper, or publishing the big Sunday paper on Saturday as an all-weekend edition. (The Sunday edition of the Press Herald is called the Maine Sunday Telegram.)
According to the Press Herald’s latest filing with the Alliance for Audited Media, the Saturday print edition is slightly larger than the Monday edition (25,450 to 25,358). The Saturday edition, though, gets an artificial boost — the Press Herald offers a four-day Thursday-through-Sunday print subscription as a cheaper alternative to seven-day (soon to be six-day) print. Paid Sunday print circulation is 40,091.
Still, anyone who’s paged through the Monday edition of a local daily newspaper knows that advertising on that day is virtually non-existent. So, for a variety of reasons, the Press Herald probably made the right choice.
Also, Kris Olson offers this:
Monday editions mean employees working on Sundays, which means time-and-a-half, right? If so, from a payroll perspective, eliminating a Monday issue gives you the biggest bang for your buck.
The Press Herald isn’t the first daily paper to cut print days. It’s worth watching, though, because the owner, Reade Brower (who also owns most of the daily newspapers in Maine as well as a few weeklies), seems committed to coming up with a long-term strategy for economic sustainability. Press Herald publisher Lisa DeSisto tells her paper that the Monday move will enable the paper to avoid cutting staff.
Perhaps he might consider emulating the Arkansas Democrat-Gazette, which last year eliminated print except on Sundays and gave its paid subscribers free iPads so they could continue to read the paper online.
This is a hoot. After the Portland Press Herald made it known that it would drop freelance-written reviews of local books as a cost-saving measure, Maine’s favorite author, Stephen King, lodged a protest on Twitter and urged his followers to do the same.
The Press Herald responded that if King could persuade at least 100 people to buy digital subscriptions, they would restore the reviews to the Sunday edition, known as the Maine Sunday Telegram:
It worked, and the book reviews will return next Sunday. “It’s a Stephen King story with a happy ending,” publisher Lisa DeSisto told The New York Times. (I worked with DeSisto at The Boston Phoenix many years ago, and she makes a cameo in “The Return of the Moguls.”)
Let me pour just a small amount of lukewarm water on all this. First, cutting local book reviews without consulting readers makes as little sense as, oh, slashing the Sunday funnies. Second, I hope this doesn’t become a habit. Hey, let’s tell everyone we’re going to stop covering restaurants unless we can sell 1,000 more subscriptions.
Still, this is a great story. I’m glad King’s influence did the trick.
Clarification: There was no public announcement that the Press Herald was planning to drop local reviews, but freelance contributors were made aware of it. I’ve rewritten the top to reflect that.
Monday update: Publishers Weekly has an especially detailed account of what went down. Also, King’s gambit did not save jobs elsewhere at the Press Herald:
Some related news: book reviews may be saved, but local data journalism is not. The Press Herald gave me (and several others in the newsroom) a pink slip on Friday. https://t.co/Arw56EnBZy
Politico media columnist Jack Shafer has written, if you can believe it, a semi-defense of the hedge fund Alden Global Capital and its principal, Randall Smith, who are in the midst of running their newspapers into the ground. Alden owns the Digital First Media chain, whose Denver Post is the locus of an insurrection against hedge-fund ownership. The 100-paper chain also owns three Massachusetts properties: the Boston Herald, The Sun of Lowell and the Sentinel & Enterprise of Fitchburg.
Shafer’s argument is a simple one: the end is at hand for the newspaper business, no one has figured out how to reverse its shrinking fortunes, and so therefore Smith can’t be blamed for squeezing out the last few drops of profit before the industry collapses. “Smith may be a rapacious fellow,” Shafer writes, “but his primary crime is recognizing that print is approaching its expiration date and is acting on the fact that more value can be extracted by sucking the marrow than by investing deeper or selling.”
Now, it’s possible that Shafer is right. But I’m considerably more optimistic about the future of newspapers than he is. Let me offer a few countervailing examples.
1. I certainly don’t want to sound naive about GateHouse Media, a chain of several hundred papers controlled by yet another hedge fund, Fortress Investment Group. GateHouse, which dominates Eastern Massachusetts, runs its papers on the cheap, too, and I’ve got a lot of problems with its barebones coverage of the communities it serves.
But GateHouse, unlike Digital First, is committed to newspapers. That’s why both insiders and outsiders were hoping GateHouse would buy the Herald. I genuinely think the folks at GateHouse are trying to crack the code on how to do community journalism at a profit for some years to come — and yes, its journalists are underpaid, and yes, I don’t like the fact that some editing operations have been centralized in Austin, Texas. But it could be worse, as Digital First demonstrates. For some insight into the GateHouse strategy, see this NPR story.
2. Smaller independently owned daily papers without debt can do well. The Berkshire Eagle is in the midst of a revival following its sale by Digital First to local business interests several years ago. In Maine, a printer named Reade Brower has built an in-state chain centered around the Portland Press Herald that by all accounts is doing well.
3. Large regional papers like The Denver Post are the most endangered. Transforming The Washington Post into a profitable national news organization, as Jeff Bezos has done, was a piece of cake compared to saving metros. As I describe in “The Return of the Moguls,” billionaire owner John Henry of The Boston Globe is pursuing a strategy that could result in a return to profitability: charging as much as the market will bear for print delivery (now up to more than $1,000 a year) and digital subscriptions ($30 a month). Globe executives say the paper is on track to pass the 100,000 mark for digital subscriptions in the first half of this year, and that the business model will start to look sustainable if it can reach 200,000.
In other words, reinventing the newspaper business is not a hopeless task. Randall Smith and Alden Global Capital have taken the easy, cynical route — but not the only route. There are better ways.
Digital news pioneer Rob Curley is out as editor of the Orange County Register, whose acquisition by Digital First Media was completed earlier today. The story was broken by the Orange County Business Journal.
Gustavo Arellano, the editor of OC Weekly, adds that some 50 to 70 employees are losing their jobs at the Register and its sister paper, the Riverside Press-Enterprise. These are “mostly on the sales, circulation, and marketing side,” Arellano writes, a sign that Digital First—which also owns several other papers in Southern California—is consolidating its business operations.
A little more than a year ago I spent a good chunk of a day at the Register as part of my book project. Curley, who made his bones as an early digital guy at the Lawrence Journal-World a dozen years ago, followed by stops at the Washington Post and the Las Vegas Sun (among other places), allowed me to spend a considerable amount of time with him and answered all questions. However, it was completely off the record, so I can’t share with you anything I learned. I can tell you it wasn’t all that eventful.
The next day, Kushner—who had tried to purchase the Boston Globe and Maine’s Portland Press Herald before leading a group that bought the Register in 2012—stepped down a day before I was to interview him. Kushner’s emphasis on print, and his head-turning moves to hire staff and buy and launch newspapers (including a short-lived daily in Los Angeles), earned him national recognition. Unfortunately, a shortage of funds led him to dismantle what he had built in very short order.
Digital First bought the Register and the Press-Enterprise for $49.8 million after the US Department of Justice convinced a federal judge that a higher bid by Tribune Publishing, which owns the Los Angeles Times and the San Diego Union Tribune, should be rejected because it would reduce competition.
It struck a number of observers, including me, that the government was engaged in outdated thinking that no longer applied to the shrinking, money-losing newspaper business. Tribune has gone through numerous gyrations over the years, but the LA Times has remained an excellent newspaper. It almost certainly would have been a better steward of the Register and the Press-Enterprise than Digital First.
The Frederick News-Post won the Internet Tuesday with a hilariously defiant editorial.
Faced with a threat by a city council member named Kirby Delauter to sue if his name was published without his permission, the Maryland newspaper responded with a piece headlined “Kirby Delauter, Kirby Delauter, Kirby Delauter” that repeated his name nearly 50 times and included his photo. And if that didn’t make the point sufficiently, the first letter of each paragraph spelled out “K-I-R-B-Y-D-E-L-A-U-T-E-R.”
Delauter’s ludicrous assault on the First Amendment was easily batted away. But not all matters involving freedom of speech and of the press are as amusing or as trivial. You need look no further than the Moakley Federal Courthouse in Boston, where the trial of accused Boston Marathon bomber Dzhokhar Tsarnaev is about to begin without the benefit of television cameras inside the courtroom.
Tsarnaev may be sentenced to die on our behalf — yet we are being denied the right to watch the justice system at work, a crucial check on the awesome power of government. Last year a WGBH News Muzzle Award was bestowed upon U.S. Supreme Court Chief Justice John Roberts for his opposition to cameras in federal courtrooms. Unfortunately, the situation seems unlikely to change anytime soon.
At least the ban on courtroom cameras does not explicitly violate the First Amendment. The same cannot be said of Maine District Court Judge Jeffrey Moskowitz, who on Monday ruled that the news media were prohibited from reporting anything said in court by the defendant in a domestic-violence case, a criminal defense lawyer named Anthony Sineni. Reporting on witness testimony was prohibited as well.
The Supreme Court has ruled that nearly all gag orders such as Moskowitz’s are unconstitutional. “There is a 100 percent chance this order is unlawful,” said Press Herald lawyer Sigmund Schutz, who was quoted in a blog post by Justin Silverman, executive director of the New England First Amendment Coalition. “There is no question that the U.S. Supreme Court and other courts have been very clear, what occurs or is said in the court is a matter of public record.”
A different sort of gag order is preventing us from learning everything we might know about the death of Michael Brown, the black unarmed teenager who was fatally shot by Darren Wilson, a white police officer, in Ferguson, Missouri, earlier this year. Whether Wilson’s actions were justified or not, the incident helped expose the racial divide in Ferguson and sparked protests nationwide.
Now it turns out that a member of the grand jury that chose not to indict Wilson wants to speak, but is prohibited from doing so by a Missouri law that requires grand jurors to remain silent. The grand juror has filed suit against St. Louis County Prosecutor Robert McCulloch to be allowed to discuss the case.
Though it’s not clear what the grand juror has to say, a report by Chris McDaniel of St. Louis Public Radio offers some hints. Quoting from the lawsuit, McDaniel writes: “In [the grand juror]’s view, the current information available about the grand jurors’ views is not entirely accurate — especially the implication that all grand jurors believed that there was no support for any charges.” (McDaniel notes that grand jury decisions need not be unanimous.)
Though it is not unusual for grand jury members to be prohibited from speaking, the ACLU, which is assisting with the suit, says that in this particular case “any interests furthered by maintaining grand jury secrecy are outweighed by the interests secured by the First Amendment.” The Boston Globe today editorialized in favor of letting the grand juror speak.
What all of these cases have in common is the belief by some government officials that the press and the public should be treated like mushrooms: watered and in the dark. These matters are not mere threats to abstract constitutional principles. they are assaults on the public’s right to know.
Or as the Frederick News-Post so eloquently put it: Kirby Delauter! Kirby Delauter! Kirby Delauter!
I suppose it would be naive to say that I’m surprised. But I am, at least a little bit. As recently as this past summer an insider told me that the Providence paper was struggling but that Portland was doing well. And Portland is the sort of small, insular, arts-rich city where alt-weeklies are still hanging on. In fact, as Koenig observes of The Portland Phoenix:
It long appeared from the outside to be the most financially stable of the Phoenix papers, always keeping enough advertising to fill out around 50 pages of content (newspapers get thinner when there aren’t enough ads to justify printing as many pages) and never needing to follow the Boston Phoenix’ desperate, last moment reinvention as a glossy magazine.
Desperate? Maybe. I think you could also make the case that if the Boston paper had gone the glossy route two or three years earlier, it might still be around.
In any case, I’m hoping that this time the story turns out differently. The mere fact that someone wants to buy the paper suggests that, from a business point of view, there’s something worth saving.
If you’re going to make an audacious bet on the future of newspapers, as Aaron Kushner did with the Orange County Register, then it stands to reason that you should have enough money in the bank to be able to wait and see how it plays out.
Kushner, unfortunately, is now slashing costs at his newspapers almost as quickly as he built them up. On Tuesday, Kushner announced that Register employees would be required to take unpaid two-week furloughs during June and July. Other cuts were announced as well. The most significant: buyouts for up to 100 employees; and one of Kushner’s startup dailies, the Long Beach Register, will more or less be folded into another, the Los Angeles Register.
Those cuts follow the elimination of some 70 jobs at the OC Register and the Press-Enterprise of Riverside in January — cuts that came not long after a year when Kushner’s papers, in a celebrated hiring spree, added 170 jobs.
In 2013 Kushner and his business partner, Eric Spitz, were the toast of the newspaper industry. In the Columbia Journalism Review, Ryan Chittum hailed their print-centric approach and hypothesized that being able to scoop up the Register debt-free might enable them to succeed where others — including Tribune Co. and the Journal Register Co. — had failed. “Kushner,” Chittum wrote, “had the benefit of buying Register parent Freedom Communications out of bankruptcy — after newspaper valuations had already fallen 90 percent in some cases.”
Spitz, in a cocksure interview last October with Lauren Indvik of Mashable, mocked his competitors for giving their journalism away online, insisting that he and Kushner had a better idea.
“The key decisions they made — and they were the worst decisions anyone has made in my memory — they made 20 years or so ago. They took their core product, the news, and priced it at free,” Spitz told Indvik, adding: “I think 20 years later the amount of revenue you can derive from advertising is less than they thought. But the bigger problem they created is telling your customer that your product has no value.”
Unfortunately for Spitz and Kushner, there are few signs that their strategy of pumping up their print editions (even improving the paper stock) while walling off their digital content behind relatively inflexible paywalls has paid off.
According to the Alliance for Audited Media, paid circulation at the Orange County Register for the six months ending Sept. 30, 2011, before Kushner and Spitz took charge, averaged 283,997 on Sundays and 172,942 Monday through Saturday. The sale took place in July 2012. That September, paid circulation actually rose, to 301,576 on Sundays and 175,851 the rest of the week. But in September 2013 it dropped below pre-Kushner levels, to 274,737 on Sundays and 162,894 the other six days. (I am excluding what AAM refers to as “branded editions” — mainly regional weeklies published by the Register. The numbers combine print and paid digital circulation, which, in the case of the Register, is negligible.)
Kushner is a Boston-area native who made his money in the greeting-card business. Before his move to Southern California, he tried to buy The Boston Globe and, later, nearly closed a deal to purchase the Portland Press Herald of Maine. So it’s interesting to note that Red Sox principal owner John Henry, who eventually won the sweepstakes for the Globe, has taken a very different approach from Kushner, sinking money into an online-only vertical covering innovation and technology as well as repositioning the paper’s venerable free Boston.com site as a “younger, voicier, edgier” complement to the Globe. Soon the Globe is expected to unveil an ambitious website covering the Catholic Church in the hopes of attracting a national and international audience.
Perhaps the most important difference between Henry and Kushner, though, is the depth of their pockets. There are limits to Kushner’s wealth, and those limits are becoming apparent as he attempts to make his newspaper mini-empire profitable. Henry, a billionaire investor, can afford to take the long view. In that respect, he is more like Amazon.com founder Jeff Bezos, who announced that he would buy the Washington Post just days after Henry said he would acquire the Globe.
Ryan Chittum, in his CJR piece, called Kushner’s approach “the most interesting — and important — experiment in journalism right now.” It would be easy and facile to make too much of Kushner’s woes. He may simply have gotten ahead of himself, and is now buying the time he needs to make sense of what he is building. Then again, if Ken Doctor is right, the end of this particular newspaper story may be in sight.
Has Orange County Register owner Aaron Kushner run into nothing more than a bit of turbulence from which he can recover? Or do the layoffs he announced last week show that his plan to resuscitate the newspaper business by hiring more journalists and doubling down on print is fundamentally flawed?
I hope it’s the former — not just because I’d like to see him prove everybody wrong (including me) about the future of news, but because I’m planning to include him in a book about a new breed of media moguls who are using their personal wealth and smarts to innovate their way toward a brighter future. (News of the layoffs was broken by Gustavo Arellano of OC Weekly, which has taken a jaundiced view of Kushner’s ownership.)
Trouble is, there have been hints previously that Kushner, 40, lacked the sheer financial firepower of Boston Globe owner John Henry or Washington Post owner Jeff Bezos. I’ll get to that in a moment. But first, a little background on what’s unfolding in Southern California.
Kushner, who bought the Register in 2012 for $50 million, was the most celebrated new newspaper owner in the country before he was eclipsed in August of last year by Bezos and Henry. “Can Aaron Kushner save the Orange County Register — and the newspaper industry?” asked the Columbia Journalism Review last May. As CJR’s Ryan Chittum explained it, Kushner’s vision was based on:
Lavish attention to the print product, including more pages and an upgrade in the quality of paper.
A move away from free or even reduced-price content online, with Internet users paying exactly the same fees as print subscribers.
An increase in the size of the newsroom staff, as he added 140 journalists to the 180 who were there when he bought the paper.
Nor was Kushner content with pumping up the Orange County Register. Last August he started a new daily, the Long Beach Register. He bought The Press-Enterprise of Riverside. And in his most audacious move yet, he announced plans to start a Los Angeles Register to compete with the Los Angeles Times, once among the best newspapers in the country and still formidable. (LA is also home to a second paper, the Los Angeles Daily News.)
Then, last week, came a significant setback. Not everyone agrees on the figures, but Ken Bensinger of the LA Times reported that Kushner laid off about 35 people at the Orange County Register and 39 at The Press-Enterprise. Register editor Ken Brusic and other top editors left. Rob Curley, who had overseen digital initiatives at papers at the Washington Post and the Las Vegas Sun, was promoted to the top position.
“We are evaluating our cost structure for the next leg of our journey in terms of covering Orange County and LA County,” Kushner told New York Times media columnist David Carr, who noted that Kushner plans to plunge ahead with his idea for a Los Angeles paper without adding any staff. Carr wrote:
By amortizing the costs of all the journalists he hired over a bigger market, he can achieve savings in terms of production while adding marginal readers and advertising.
He clearly sees himself as a smart entrepreneur making bold bets. I see a man on a wire, with millions of dollars and hundreds of jobs at stake.
As for past hints that Kushner may not be well-heeled enough to play the long game, you may recall that, several years ago, he tried to buy The Boston Globe. (The Globe’s then-owner, the New York Times Co., apparently showed no interest, and Kushner later struck out on a bid to purchase Maine’s Portland Press Herald.)
Before Kushner gave up on his Globe dream, though, Katherine Ozment wrote an in-depth profile of him for Boston magazine. Among other things, Ozment attempted to show precisely how Kushner had made a fortune in the greeting-card business, his major claim to fame up to that time. What she found was a haze of acquisitions, layoffs and charges (which Kushner denied) that he was late in paying artists, sales reps and the like.
Eventually Kushner left his company after some sort of falling-out with the investors, though he told Ozment he remained part of ownership. “I had a vision for the business, and they had a very different vision, and they controlled the working capital, so we decided to move on,” he said.
Despite that possible warning sign, it has to be noted that the Orange County Register remains a much more richly staffed paper today than when Kushner bought it. In a memo to his staff published by the blog LA Observed after the layoffs were announced, Kushner wrote that he now has 370 journalists — uh, make that “content team members” — covering Orange County and Los Angeles County, up from 198 a year and a half ago.
An optimistic take would be that Kushner got ahead of himself and is now retrenching, but not retreating. No doubt we’ll know a lot more as 2014 unfolds.
Photo (cc) by CSUF Photos and published under a Creative Commons license. Some rights reserved.
I wasn’t ready to announce this, but Mark Shanahan of The Boston Globe beat me to it. My next book will be about a new era of newspaper owners and how they are going about remaking their struggling businesses.
The book will focus on Amazon.com founder Jeff Bezos, who is in the process of buying The Washington Post; Red Sox principal owner John Henry, who’ll soon add the Globe to his holdings; and Aaron Kushner, a businessman who tried to buy the Globe and then Maine’s Portland Press Herald before reeling in the Orange County Register. It’s a logical next step in my research into new ways of paying for journalism.
The idea grew out of conversations with Steve Hull, an acquisitions editor at University Press of New England. We’d been trying to do business together for a couple of years, pitching possible projects back and forth. There’s no contract at the moment, but I expect to write the book for a yet-to-be-named new trade division of UPNE. No, I won’t tell you the working title, and I expect it will change long before the publication date — probably sometime in 2016.
“The Wired City” was published by University of Massachusetts Press, an academic publisher I would recommend to anyone. I’ve had a great relationship with acquisitions editor Brian Halley, publicist Karen Fisk and company, and I can’t say enough good things about them.
Photo (cc) by Esther Vargas and published under a Creative Commons license. Some rights reserved.
Big news coming out of the Boston Globe today: Lisa DeSisto, chief advertising officer of Boston Globe Media and general manager of Boston.com, is leaving to become chief executive officer of MaineToday Media and publisher of the Portland Press Herald.
I worked with Lisa at the Phoenix back in the 1990s, and I think I can safely say that the Globe will miss her. Just recently, Lisa came up with the idea of launching an online radio station at Boston.com, RadioBDC, featuring several folks who had been laid off when the Phoenix sold WFNX Radio. WFNX continues online as well, and is formally relaunching on Oct. 31.
Here’s the announcement from Globe publisher Christopher Mayer:
I’d like to update everyone on a change in the leadership of the Globe. After 17 years, Lisa DeSisto will be leaving the Globe to become chief executive officer of MaineToday Media and the publisher of the Portland Press Herald. Lisa’s contributions to the Globe and Boston.com have been enormous, and she will be missed.
Fortunately, she has a strong team in place. Jason Kissell, Jane Bowman, and Tom Cole will report to me. Jason Kissell, vice president for advertising, will take on all advertising sales responsibilities, including digital advertising operations. Jane Bowman, executive director of advertising, will retain her business development responsibilities and add oversight of marketing and RadioBDC. Tom Cole, executive director of business development, will continue in the role of strategic planning and development for advertising.
Lisa will be with us for the next two weeks. During that time, she will help with the transition. Though we will miss her creativity, enthusiasm, and friendship, this is a great opportunity for her. Please join me in wishing her well in her new role.