Tribune’s Editor-Publisher Merger is its Worst Idea Yet

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In difficult times, it can be hard to distinguish innovation from desperation. These days of digital disruption are about as rugged a period as the American newspaper industry ever has experienced. It still ought to be clear, though, that Tribune Publishing’s decision last week to blend the jobs of editor and publisher at its newspapers—including the Los Angeles Times—falls into something worse than the desperate category.

How much worse?

The analytic philosopher Saul Kripke once declined to review a colleague’s paper for an important journal and, when asked why, is said to have replied, “It’s so far off the mark, it isn’t even wrong.”

At the Times, the top editorial and business jobs last were united in the 19th Century, when Harrison Gray Otis simultaneously held the posts of president, general manager and editor-in-chief. We all know how well that worked out, as he turned the paper into an unashamed megaphone for unrestrained boosterism, biased reporting and violently reactionary politics. By the time Otis died in 1917, the Times generally was regarded as the worst newspaper in the country.

Tribune Publishing now is being run by a klatch of tech and healthcare people headed by Chicago entrepreneur Michael Ferro, who was allowed to take over the foundering chain on the strength of a sweetheart deal in which he injected  $44.4 million into Tribune in return for a controlling 16.6% of the stock purchased at a discount. In little more than a month, Ferro ousted the previous CEO, Jack Griffin—a one-time magazine executive with a decidedly mixed track record—and his entire team, replacing them mostly with other tech executives.

They proceeded to announce this new move in the Orwellian argot of their kind as a “content first” initiative. I have a vague idea of what that’s supposed to mean, but a very sure understanding that Ferro et al just eliminated the biggest salary on every one of their newspapers. Like all who have come before them since the old diversified Tribune acquired Times Mirror—then the LAT’s owner—15 years ago, they haven’t any real idea of how to make money from newspaper journalism, but what they can do is cut.

For all the talk about transformation and multiple platforms for Tribune’s journalism, the chain has done a worse than average job when it comes to attracting digital subscribers—and that bar isn’t really very high. Taken together, all nine of Tribune’s papers have just 88,000 digital subscribers; the New York Times, by contrast, has more than 1 million. Ferro and his people are distinctly short on details on how they plan to reverse this, or about how they plan to make money by other means. That may not matter all that much, since the editorial teams in place at their major papers, including the Times, don’t have much of a record for executing strategies of any kind—beyond serial layoffs, of course, and they’re expert at that.

What’s really at issue here is whether Tribune Publishing in its current iteration can survive on any foreseeable terms. When Tribune Media spun off its newspapers a bit more than a year ago, it essentially set up the chain to fail. They stripped all of the papers of all their valuable real estate, including their historic headquarters buildings, and money generating digital and other enterprises. They also saddled them with more than $300 million in debt so that the broadcasting company’s shareholders could receive a “special” dividend.

Given the prevailing conditions in the newspaper industry and barring some miraculous intervention, they created a company with a viable shelf-life of 18 months to two years. Then, it will be either liquidation on fire sale terms or back to bankruptcy.
Today, Tribune Publishing’s total market capitalization is just $242 million. Its fourth quarter ad revenues were down 8.7% and circulation revenues were flat. Over the past year, its stock price has fallen by as much as 50%, trading as low as $5.68-per-share.

Tribune Publishing’s move may make a kind of shortsighted sense as a cost-saving measure, but it makes no discernible sense from either a business or editorial standpoint. Anyone who pretends otherwise is whistling down the wind.

Even with Ferro’s $44.4-million transfusion, the company has just $80 million in cash on hand.  As the New York Times reported last week, “By early this year, according to people with knowledge of the company’s finances, who spoke on condition of anonymity to reveal confidential information, the company was down to about $40 million in cash reserves and was not able to raise any debt. It was, said one of those people, just a few bad months away from being unable to pay its bills.”

In fact, people on staff at the Times say they’ve been told by their editors that they soon will have to move to a different, smaller part of the old Times Mirror Square or to some other building entirely because the paper no longer can afford the rent Tribune Media is charging. (Carved into the granite beside the entrance to the Times building is this motto: “This is the fourth home of the Los Angeles Times and stands as a symbol of faith in California.)

Against this backdrop, media analyst Ken Doctor recently posed this question: “What do we make of the editor-publisher strategy? On a business level – and that’s where the money is generated, right—it is bewildering. Neither Davan Maharaj (The Times’ editor-publisher) nor Bruce Dold (Chicago Tribune), for instance, have any business-side experience. Neither do most, if not all, of those named “publishers.” Maharaj will report directly to CEO Justin Dearborn, again showing the editor’s much-observed talent to “manage up.” In that relationship, long-time editor Maharaj will have a boss who himself has no media revenue-generating experience.”

This new arrangement won’t work for other reasons. Putting aside the issues of complexity in modern newspaper operations, no one I’ve ever known has the required expertise to run both a business side and a newsroom—let alone the time and energy to do justice to both roles.

Moreover, the separation of newspapers’ business and editorial operations was undertaken after long experience not for purely ethical reasons, but also for pragmatic ones. If both operations are centered in one office, editorial independence inevitably will be compromised and the detriment of the journalism’s quality and, therefore, its salability to readers and advertisers.

The image to keep in mind is parallel lines: Neither makes sense without the other and both must be strong, but if they’re going to move forward, they never can touch.
Tribune Publishing’s move may make a kind of shortsighted sense as a cost-saving measure, but it makes no discernible sense from either a business or editorial standpoint. Anyone who pretends otherwise is whistling down the wind. Tribune, as Doctor has described it, is a company perpetually in transition without ever achieving transformation.

This latest goofy, history-defying, lets-try-anything move reeks of desperation. In fact, it is just the latest example of Tribune’s nearly unbroken record of failing to meet its responsibilities to the Times’ readers and their community.    

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