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Posts tagged ‘The Opelousas Daily World’

Jim Hopkins on Gannett and the Future of The Town Talk and The News Star

“They will be reduced to websites with just a small amount of local news, much of which will be determined by assignment and editing from afar.”

Jim Hopkins is the founder and editor of Gannett Blog, the leading media trade blog site about the nation’s largest newspaper company, Gannett Company. Gannett, of course, is the owner of the USA Today and 82 other daily newspapers in the United States, including five papers in the Gret Stet of Louisiana: The Shreveport Times, The Monroe News-Star, The Lafayette Advertiser, The Opelousas Daily World, and The Alexandria Town Talk.

Jim, a graduate of Brown University, knows a thing or two about Gannett. He spent over twenty years working at Gannett as both a journalist and an editor, the last eight of which were at the USA Today. Since launching Gannett Blog in 2007, Jim has kept a close and keen eye on his former employer, and in doing so, he’s helped shed significant light on Gannett’s digital transition and the ways in which corporate decisions affect local communities, Gannett employees, and the delivery of the news.

Last Friday, my friend Daniel and I were interviewed for a documentary about the American Way (which will be the subject of another post), and we both spoke, at length, about how Gannett’s ownership fundamentally changed our hometown newspaper, The Town Talk. Afterward, I reached out to Jim Hopkins and asked if he’d be willing to answer a few questions, and thankfully, he was happy to oblige.

Lamar: The Town Talk was founded in 1883, which makes it one of the longest continuously operating newspapers in the entire country. They were the first newspaper in the entire State of Louisiana to become computerized– way, way back when “computerized” was a word that actually meant something. There’s an entire book about the history of The Town Talk. To me, The Town Talk was always more than just a newspaper; it was a civic institution. In 1996, Central Newspapers bought The Town Talk for $62 million from the local family that had owned it from the very beginning, and shortly thereafter, Gannett bought Central Newspapers. Today, it seems like a shell of its former self. It’s no longer a civic institution. Their printing press buildings, which eat up an enormous footprint along our river, are all closed. Our paper is now printed nearly 100 miles away. The people who work there are now in constant fear of losing their jobs. And of course, because it’s the only newspaper in town, this is not reported properly. What should we blame for the decline of the newspaper as a civic institution? Is it the Internet? Is it corporate consolidation?

Jim: There are multiple factors. Readers, especially young readers have been abandoning newspapers for several decades. The Internet accelerated that trend.

The Internet also began siphoning off advertising beginning especially after 1995, when the Web proved to be commercially viable.

Newspaper publishers became complacent because they had long held monopoly positions in local markets. They stopped innovating and attending to customer service.

The sale of family-owned newspapers to big, publicly traded companies such as Gannett, Knight-Ridder, McLatchy and Lee Enterprises also played a role. Those are all companies that must attend to Wall Street’s demands, and Wall Street cares only about growing profits; institutional investors such as pension funds, mutual funds and other money-management outfits care very, very little for editorial quality.

Lamar:  Once upon a time, all of the ad revenue that The Town Talk generated was recycled locally; now, the vast majority of it is shipped up to Virginia and then split up between executives and shareholders. Once upon a time, our newspaper was a major contributor to our local tax base and a major local employer. Now, they’re attempting to sell the giant buildings that housed their printing press- a business that had been as old as the paper itself, and they’re routinely firing key employees in an effort to increase efficiency. What is the real goal here? Is there evidence these executive-level decisions have resulted in increased efficiency, productivity, or profitability?

Jim: The goal is to bolster profits by cutting costs, especially the one expense that can be controlled: labor. Gannett has done a very good job of keeping its profits high, but almost solely through consolidation of work through press closings and other austerity measures. The question is: How long before the company starts cutting into bone, which would then have the opposite effect on profits. Only time will tell. 

Lamar:  What’s the future of the Monroe News-Star?

Jim: I believe the future for all community newspapers owned by Gannett is the same: They will be reduced to websites with just a small amount of local news, much of which will be determined by assignment and editing from afar.

Lamar: What’s the future of The Town Talk?

Jim: See above.

Lamar: Is this an overly simplistic explanation of Gannett’s newspaper acquisition strategy? We’re going to only buy in markets we can already cannibalize, and then, hopefully, we can cannibalize the entire market.

Jim: I think that is an accurate assessment.

Lamar: I know several employees at our local paper had to consent to furloughs, and I believe, based on my own personal experience, that these furloughs delayed the efficient delivery of local news. How much did Gannett save by enforcing furloughs?

Jim: At least $43 million, according to Gannett’s regulatory filings. 

Lamar: How much did Gannett give out in executive bonuses?

Jim: Bonuses for the six highest-paid executives for 2008-2010 are in this table, in column No. 2. Chairman and CEO Craig Dubow, for example, received $1.75 million last year. 

Lamar: If you were CEO of Gannett, what are the first three things you would do?

Jim: Suspend the strategic plan. Recommend that the board of directors be reconstituted with an entirely new slate of members. Resign my position.

Lamar: If you wanted to buy The Town Talk, what would be your opening offer?

Jim: I do not have enough information to even guess at a figure. 

Lamar: Thanks. You rock. What’s the last book you read?

Jim: I almost exclusively read magazines, newspapers and other periodicals. Having said that, the last book I read was Portrait of an Addict as a Young Man

Gannett Cuts 31 Jobs in Louisiana; Guts Monroe News-Star

Per The Alexandria Town Talk and The Independently Weekly, on Tuesday, Gannett Company, the nation’s largest newspaper publisher and the owner of several major newspapers in Louisiana, including The Shreveport Times and The Town Talk, cut 632 jobs across the country, including 31 jobs in Louisiana.

According to a spreadsheet produced by the watchdog site Gannett Blog, two jobs were cut at The Shreveport Times, two at The Town Talk, and 27 jobs eliminated were at the Monroe News-Star, effectively gutting the newspaper and following through on its word to consolidate the Monroe paper with the Shreveport paper. The cuts at the Monroe News-Star were expected; The Shreveport Times and The Monroe News-Star reported the consolidation last week. Quoting:

Press consolidation, which has become more and more common in the last few years, will reduce expenses. In Monroe, 12 full-time and 15 part-time positions will be eliminated with the move. New positions will be added in Shreveport with the consolidation and Monroe employees will be given first option for those positions.

Despite the insistence that this consolidation will not affect delivery or the quality of the paper, Gannett Blog calls attention to Gannett’s announcement that, in preparing for the consolidation, it purchased a “Berliner.” From the official news release:

The Monroe newspaper will be printed at The Times, which recently installed a Berliner press that produces a newspaper with an 18-inch depth. In addition, the Berliner press allows advertisers to place color advertising on every page, which is important in today’s changing media environment.

Berliners are more commonly used in Europe, but Gannett has been slowly rolling out the equipment in the United States.

In simple terms, Berliners fundamentally change the aesthetics and formatting of a newspaper.

Gannett Blog wonders: Is this what The Monroe News-Star will look like now?

Examples of newspapers published on a Berliner press

Who knows?

Either way, change is gonna’ come.

But as Heather Miller of The Independent Weekly points out, there’s another story here, a story you probably won’t read in any Gannett-owned paper.

While Gannett guts newspapers all across the country, consolidates its printing operations, and continues to lay off hundreds of employees, including journalists and editors who have have served their local communities for decades, the wealthy corporate executives at Gannett are only getting wealthier.

In queue with the corporate American dream, Gannett, which owns five newspapers in the state, didn’t just distribute the dreaded employee memo, it also shelled out $3 million in bonuses to its top two execs last year. That’s on top of the combined $17.6 million it paid for salaries alone on its two top dogs, according to a March 25 Poynter Institute blog:

Craig Dubow‘s pay included a $1.75 million all-cash bonus, reports Jim Hopkins. Chief Operating Officer Gracia Martore was paid $8.2 million, with a cash bonus of $1.25 million. The bonuses were awarded partly on the basis of cost-cutting that included layoffs, unpaid furloughs and other austerity measures, according to a shareholders proxy report filed on Thursday. Dubow would get $22.5 million if he quit right now.

It reminds me of the fantastic report published last weekend on The Washington Post. Titled “With Executive Pay, the Rich Pull Away from the Rest of America,” the story, which relies heavily on “landmark analysis” conducted by three renowned economists, documents the ways in which executive pay has dramatically exacerbated the income disparity in America.

Gannett, in many ways, appears to be a model example of the trends documented by The Washington Post. In March of this year, the Associated Press reported:

USA Today owner Gannett Co. increased CEO Craig Dubow’s pay package by 80 percent to $7.9 million last year to reward him for boosting the newspaper publisher’s earnings and reducing debt as revenue fell for the fourth consecutive year.

The largest part of Dubow’s 2010 compensation consisted of stock incentives with a total value when granted of $5 million, according an Associated Press analysis of regulatory documents filed Thursday.

But here’s the irony:

Gannett shares have plunged by nearly 80 percent since Dubow became CEO in July 2005, reflecting a steep downturn in newspaper advertising that has sapped publishers’ main source of revenue.

….

Gannett has been laying off workers and imposing unpaid leaves to save money. Dubow, 56, is trying to do his part by agreeing to lower his $1.2 million salary by least 17 percent through 2011. His salary last year totaled $980,769.

The company eased the pain of last year’s salary reduction by awarding Dubow a cash bonus of $1.75 million, a 21 percent increase from $1.45 million in 2009. He also received other perks totaling $159,465.

Got that? He lowered his salary as an austerity measure, or something like that, but it didn’t matter much. He was awarded with a $1.75 million cash bonus.

Meanwhile, according to some sources, Gannett’s insistence on furloughs only saved the company $10 million, and it remains to be seen whether or not the most recent layoffs and consolidations will increase efficiences and increase profitability or if they’ll simply destroy the very newspapers Gannett apparently hopes to save. After all, it’s almost impossible to run a newspaper without a properly-staffed news room, qualified editors, and an experienced and knowledgeable editorial board.

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