Media Watch

Cops raids newspaper offices; New GlobeReader adds puzzle and is puzzling

NYPD Raids Newspaper-Delivery Offices including Times & Post

A law enforcement official said the New York Police Department raided circulation offices at some of the nation's largest newspapers as part of a union corruption probe.
   The official says the offices of The New York Times, the New York Post, El Diario and the Daily News of New York were raided Tuesday.
   The law enforcement official said the newspaper delivery system around the city is under investigation and the news organizations are not involved.
   The 1,600-member union that delivers papers was previously accused by the Manhattan district attorney's office of being run by the mob... WSJ.

NYC's largest newspapers raided

The police raided the offices of New York City's three largest daily newspapers on Tuesday as part of an investigation into possible corruption within the union that delivers newspapers in the metropolitan area...
Another law enforcement official said the investigation would explore possible organized crime connections within the union... NY Times.

More on the cost of GlobeReader

What is the Boston Globe now charging if you want to get home delivery of the Sunday paper plus GlobeReader? When I called the subscription department yesterday, I got an answer that was so confusing I chose not to report it. But now it looks like rozzie02131 has figured it out.

The answer: $5 a week after an introductory offer. That's an increase of nearly 43 percent over the old price of $3.50. But the new GlobeReader is a lot better. And it still works out to half the cost of seven-day home delivery.

Interestingly, the Globe appears to have turned its pricing model upside-down. Previously, you got GlobeReader for free if you were a Sunday subscriber. Now - given that GlobeReader by itself costs $5 a week - you get the Sunday paper for free if you sign up for GlobeReader... MediaNation.
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New GlobeReader adds puzzle and is puzzling

The Boston Globe is taking its GlobeReader product in a different direction, and I'm not sure it makes a lot of sense.First, the good news: it's gotten better. GlobeReader now includes a feature that lets you copy or e-mail a link, just like the parent company's Times Reader. It's also added the crossword puzzle, comics, a weather map and TV listings.

Now for the not-so-good. Previously GlobeReader was free to all print subscribers, including those who took home delivery only on Sundays. Moreover, you couldn't have it for any price unless you were at least a Sunday subscriber. Given that the Globe reportedly earns some two-thirds of its revenues from the Sunday edition, the strategy seemed like a reasonably smart way of preserving the Sunday paper... MeddiaNation.

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Newspaper circulation is now in free fall

Here's the slippery slope scene for the past twenty years

You already read last week that the Boston Globe's circulation has dropped 18% in the last year, but the chart below from The Awl illustrates a longer free fall for the nations top circulation dailies. You have to scroll down a bit to see them all in the chart below.

A according to The Awl, some surprising trends were: the New York Post has the same circulation it had two decades ago, and the once-captivating battle of the New York City tabloids has become completely moot.

What AWL called unsurprising trends were: the Los Angeles Times is an absolute horrorshow. Not shown: the Boston Globe disappearing off the bottom of this chart, in a two decade decline from 521,000 in 1990 to 264,105 this year. Also now shown is our own daily newspaper who's circulation has dropped 20,000 in the same period which the area's population has growth 30%.

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Newsday columnist quits when newspaper charges for his column

Columnist Quits After Newsday Starts Charging for Its Web Site

There aren't many journalists walking away from paying jobs these days. With news organizations struggling and newsroom jobs disappearing, each week brings new calls from writers and editors who believe their flagging employers should save themselves by charging for Internet access.

So count Saul Friedman a contrarian twice over.

Mr. Friedman, who had written a column for Newsday since 1996, quit last week over the paper's decision to require some readers to pay for access to its Web site.... NY Times.

In his note to Romenesko's  journalism colum, at the Poynter Institute, the columnist wrote:

From SAUL FRIEDMAN: Your readers may wish to know this: After 13 years of writing "Gray Matters" for Newsday and the McClatchy Trib service, and more than 50 years in newspaper journalism, (for Knight-Ridder and Newsday), I have severed relations with Newsday and will write for Ronni Bennett's Time Goes By.

I will write the weekly Gray Matters as well as a twice monthly essay, "Reflections."

The main reason: The new owners of Newsday, Cablevision, have shut
off access to its web site, even to me. It is available only to Newsday subscribers or to subscribers to Cablevision's ISP. Thus I cannot send my columns to people who don't subscribe to Newsday. And if it is picked up by Google or Yahoo, it would not be accessible.

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A newsroom subsidized? Minds reel, NY Times cuts 100 in newsroom

"Those of us who work in traditional media have spent a fair amount of time wondering what part of the implosion in advertising revenue is cyclical (ad buying is suffering because of the recession) and what part is secular (we're making horse buggies)."

By Walter Brooks

The number of newspaper editorial employees grew to 60,000 in 1992, from 40,000 in 1971, and is now driving back to 40,000 in 2009, with no real bottom in sight.

That's the way David Carr's column in today's New York Times begins, and it goes downhill from there.  The only good news was that although the McClatchy Company's advertising revenue fell 28.1 percent in the third quarter, it had a net income of $23.6 million in the quarter, it was a huge improvement over the $4.2 million a year earlier, but the reason the balance sheet cleaned up so nicely was because the company eliminated more than 30 percent of its work force in the 18 months.

Carr went on to write, "The beginnings of an answer came on Thursday, when Google announced that search advertising had come roaring back and said that stronger-than-expected third-quarter results suggested the global economy might be coming back. Net income rose 27 percent in the third quarter as strong advertising sales, most all of it from search, increased revenue 7 percent."

First layoff in NY Times history
8% of newsroom staff is cut

The New York Times plans to eliminate 100 newsroom jobs - about 8 percent of the total - by year's end, offering buyouts to union and nonunion employees, and resorting to layoffs if it cannot get enough people to leave voluntarily, the paper announced on Monday... Business Insider.

Printing presses and buggy whips

Mr. Carr and other foresighted media critics whose heads are not buried in the sand have long seen the steady march towards new media from the old as newspaper subscribers die off and are not replaced by generations now comfortable with getting their information free and fast online.

The news business model is no different from that which established radio, television and cable in the recent past.

Advertising, eagerly paid by businesses wishing to reach the active consumers who get their news online.

Readers like you.

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Ban Pink

Local weeklies discover way to make reading difficult
Dark pink newsprint annoys subscribers, defeats purpose

By Walter Brooks.

Many years ago when I worked for The Cape Codder, I wrote what I hoped was a humorous, tongue-in-cheek column proposing to set up a local non-profit to work toward the outlawing of the use of the color pink on Cape Cod houses.

The organization's proposed name was "Ban Pink, Inc."

That was decades ago when the best and the brightest were eager to become newspaper men and women.  Today those left in the business don't know how to use a very pale shade of pink ink to make a statement without obscuring the entire publication when they want to call attention to an event by using that color.

Those of you who still subscribe to one of the GateHouse newspapers printed in Massachusetts discovered the truth of that statement this week when a benighted executive at GateHouse had all his newspapers printed on a fairly dark shade of pink newsprint which of course cut down greatly the contrast between the type and its background making reading the newspaper a chore rather than a pleasure.

The publisher's face should be red, not his reader's faces in the photos

No one suggests that GateHouse not help promote breast cancer awareness. The issue is the incompetence of those who do not know how to do that without making the very stories they wish to promote more difficult to read.

And why GateHouse feels it can drastically alter the appearance of all its paid ads this way and still expect to be paid for them simply boggles the mind.

In the past the executive making these decisions would have known how much easier and less expensive it would have been to use a pale shade of pink ink on the front page and features dealing with breast cancer awareness without covering the photos and ads and everything else in the process.

No one suggests that GateHouse not help promote breast cancer awareness. The issue is the incompetence of those who do not know how to do that without making the very stories they wish to promote more difficult to read.

And the old media wonders why the are losing readers.

This stupidity is coupled by a reduction in  the type size of the newspaper's body text.

I recall a time in the 1970s when newspapers were experimenting with various type sizes as well.

Then it wasn't a case of cramming more words into the ever diminishing pages of newspapers as is the case today, but a effort to discover what type size readers found most comfortable to read.

When the industry came to a conclusion, the then-publisher of The Cape Codder Malcolm Hobbs, increased his newspaper type size a little larger still because he knew a significant portion of his readers were retired and probably needed a larger type size to read his newspaper with ease.

The Cape Codder's paid circulation rose in double digits annually back then as well and topped at over 16,000 before the newspaper was sold to what is GateHouse media today.

Malcolm's Rhode's 19 sloop had a quarterboard on the stern which read "Sic transom," a play on the Latin phrase "Sic transit gloria mundi" or "so passes the glory of this world".

Today he would have changed it to "Sic transit gloria media."

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Boston Globe to charge for online content; Sony fineses Kindle; Gannett daily fires everyone

Performing a cashectomy on digital consumers
New Corp promises to do the same within a year

By Walter Brooks

"It's going to happen one way or another. We are looking at several different options, and the goal would be to generate revenue."
-Globe spokesman Bob Powers

The Globe's internet site, Boston.com, will soon require a price for admission according to several newspaper insiders who have emailed me this week.

The Boston Herald and other newspapers reported much the same last Friday.

Globe executives have already informed union leaders of the plan and a Globe spokesman confirmed there will be some sort of fee for using the site. No details have been provided to date.

The news came shortly after Rupert Murdoch said that his News Corp. (which includes the Ottaway Newspapers's Cape Cod Times, Barnstable Patriot, Nantucket Inquirer & Mirror and the New Bedford Standard-Times) will soon charge for access to all its news sites as has it's flagship newspaper, the Wall Street Journal, has since its launch.

"We intend to charge for all our news Web sites." - Murdoch.

Media critic David Carr's column this week in the New York Times went to great lengths to dissect the Murdoch plan:

The man who took over newspapering in Australia and Britain, and upended the cable news business here, planted a new flag last week, pronouncing that, contrary to popular reports, information does not want to be free; it actually wants to be paid for.

"Quality journalism is not cheap, and an industry that gives away its content is simply cannibalizing its ability to produce good reporting," he said. "The digital revolution has opened many new and inexpensive distribution channels but it has not made content free. We intend to charge for all our news Web sites."

With characteristic confidence, he added that "I believe that if we are successful, we will be followed by other media." Yes, perhaps when the change takes place over the coming fiscal year, he will be greeted by the sound of hearty applause from his fellow media companies.

Or he may just hear crickets chirping.

Certainly he is not alone. Many news organizations are wondering how to delicately perform some kind of cashectomy on digital consumers. The pay wall idea is neither new nor untried. Just last Monday, The Daily Gazette in Schenectady, N.Y., moved behind a wall... NY Times.

Rupert who?

While no media person will deny Rupert Murdoch's business acumen and huges successes, he is an old man who has admitted that he browsed the internet for the first time in the past year.

That is far from the formula for success on the web. He is 78 year old, and reportedly listening to the advice of the same folks who brought you really lousy websites like the NY Post which is so frustrating it must have been designed to push the consumer back toward print.

David Carr ends his column with this cautionary note:

Regardless of what others do, Mr. Murdoch has some work to do with consumers. When word came down in Australia that Mr. Murdoch would be expecting fees from readers of news.com.au in the coming year, readers rained invective and ridicule on the idea, including a commenter identifying himself as Alan Gilbey:

"Now let's see. Delete bookmark. Navigate to different news site. Create new bookmark. Rupert who??"

Gannet paper fires everyone
Will reorganize with 127 fewer

The Journal News, a Westchester area newspaper owned by Gannett, told all 288 of its news and advertising sales employees on Wednesday that their jobs were being eliminated and they would need to apply for redefined positions by the end of the week.
   After the redefined jobs are filled, there will be 20 fewer positions in advertising and 50 fewer positions in news, reducing the newsroom staff (which includes Web employees) by more than a quarter.
Last week, the paper laid off 57 employees in areas like production, finance, and information technology... In July, Gannett reported an 18 percent decline in revenue in its second quarter compared to the same period a year earlier. Newspaper ad revenue dropped 32 percent, it said... NY Times.

Sony to adopt new e-book technology
Latest attempt to slow up Amazon Kindle

Paper books may be low tech, but no one will tell you how and where you can read them. For many people, the problem with electronic books is that they come loaded with just those kinds of restrictions. Digital books bought today from Amazon.com, for example, can be read only on Amazon's Kindle device or its iPhone software.

Some restrictions on the use of e-books are likely to remain a fact of life. But some publishers and consumer electronics makers are aiming to give e-book buyers more flexibility by rallying around a single technology standard for the books. That would also help them counter Amazon, which has taken an early lead in the nascent market. On Thursday, Sony Electronics, which sells e-book devices under the Reader brand, plans to announce that by the end of the year it will sell digital books only in the ePub format, an open standard created by a group including publishers like Random House and HarperCollins.

Sony will also scrap its proprietary anticopying software in favor of technology from the software maker Adobe that restricts how often e-books can be shared or copied. After the change, books bought from Sony's online store will be readable not just on its own device but on the growing constellation of other readers that support ePub. Those include the Plastic Logic eReader, a thin device that has been in development for nearly a decade and is expected to go on sale early next year... NY Times.

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NH daily shuts down with no notice, a hundred lose jobs

The Eagle ran out of Time, State Will Investigate
Another New England daily closes

By Walter Brooks

     The Eagle Times closes
         No notice required

The publisher of The Eagle Times in Claremont says his family spent more than $1 million of its own money to keep the daily newspaper going before filing for bankruptcy.
The paper published its last edition yesterday, laying off 66 full-time and 29 part-time workers.
Publisher Harvey Hill said the paper had been for sale through a broker for a year but no one showed interest, the New Hampshire Union Leader reported.
Because the paper has fewer than 100 employees, it's not required under federal law to give 60 days notice of the closing to them.
A meeting was scheduled at US Bankruptcy Court in Manchester on Aug. 7. Globe.

With the Boston Globe awaiting the Newspaper Guild vote later this month before its potential buyers will make a legally binding offer New England's biggest daily newspaper, another New England daily newspaper has folded.

According to the Manchester NH Union-Leader, New Hampshire officials say they will investigate whether a state law requiring employers to give workers and communities a 60-day notice before closing applies to The Eagle Times newspaper in Claremont NH which closed the doors on Friday.

Eagle Times publisher Harvey Hill sent an e-mail to staffers Thursday saying Friday's edition of the paper will be the newspaper's last. The company had declared bankruptcy on July 11, 

Hill told employees he had done his best to keep the daily paper going, but the economy and changes in the newspaper industry have made it impossible to survive. He said his family is unable to continue underwriting the losses of the company, which also includes three weekly publications.

Roy Duddy, interim director of the state Division of Economic Development, said the state will initiate its Rapid Response Team on Friday to assist workers and their families facing layoffs, the New Hampshire Union Leader reported.

Duddy says he believes about 120 people work for the company.

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NY Times ask bids for Boston Globe, Worcester Telegram to be in by next Tuesday

New buyer must assume $59 million pension plan liability

By Walter Brooks

According to stories in the industry trade publication and elsewhere, the New York Times has asked specific parties to bid for the purchase of both its New England daily newspapers, The Globe and The Telegram.

The bids must be in by a week from tomorrow, July 8.

The Times recently concluded bargaining with all the Globe's unions and has apparently succeeded in reducing that newspaper's overhead by $50 million. The successful completion of that, due with a vote to approve the agreement by the members of the Newspaper Guild next month, was thought by many to signal that the threat of a sale had passed.

Apparently the bargaining was for the purpose of making the newspaper more "salable."

Among the published references is this in The Times followed by the one from The Globe:

Times Co. May Include 2nd Paper in Globe Sale

The New York Times Company hopes to sell a newspaper in central Massachusetts along with The Boston Globe and wants the buyer of the papers to take on $59 million in pension liabilities. It intends to make a deal quite quickly, according to a letter sent to potential bidders, The New York Times's Richard Pérez-Peña reports.

The confidential letter from the company's investment bankers at Goldman Sachs, which was obtained by a Times reporter, says the company will focus on getting the highest price and "on the certainty and speed with which bidders can sign a definitive agreement and complete an acquisition."

It sets a July 8 deadline for initial, nonbinding bids, after which the company would choose which potential buyers would participate in a second round and would be allowed to submit binding offers... New York Times.
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Times Co. sets deadline of July 8 for Globe bids
Company wants a deal that includes Telegram & Gazette, pension liabilities

The New York Times Co., through its investment banker, has asked potential buyers of The Boston Globe to submit preliminary bids by July 8, according to people briefed on the sale process.

In a letter to parties that have expressed interest in buying New England's largest daily, investment banking firm Goldman Sachs & Co., which was hired by the Times Co. to manage a possible sale, said it is looking for preliminary indications of interest, including a potential price range for bids, the people said.

They described the preliminary bids as nonbinding, stressing that the step was still early in the sales process. Following the preliminary bids would come more intense due diligence by those who indicate serious potential interest, said these people, who did not want to be named because they aren't authorized to speak about the process.

The Times Co. wants to sell the Globe as part of a package that includes the Worcester Telegram & Gazette, another paper the Times Co. owns. The letter, according to the people, details that the buyer would need to assume the papers' $59 million in pension liabilities - $51 million for the Globe and $8 million for the T&G.

The Times Co. bought the Globe for $1.1 billion in 1993 and the T&G for $295 million in 2000. The T&G is the largest daily in Central Massachusetts... Boston Globe.

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Is the Worcester Telegram the next to go?

Boston Globe sale drives other newspaper news off the front page
Bought for $296 million nine years ago, may fetch $20 million today

Many Cape Codders still read their local daily, the Worcester Telegram & Gazette, which is available on area newsstands. The 142 year-old daily dominates Central Massachusetts the way The Globe does in the east, and tens of thousands of "washashores" have retired here from the Telegram's circulation area.

Forgotten in the speculation about The Globe's fate is its sister publication which is also owned by the New York Times.

Most interesting, perhaps, is that one of the few persons who has said he might be interested in buying The Telegram & Gazette, albeit with an investment group, lives here on Cape Cod himself - Bruce Bennett, the daily's former publisher.

Mr. Bennett, 64, retired to Dennis in 2006, after 34 years at the daily, the final 14 as publisher. He began his career as a general news reporter. While at the newspaper's helm he guided the Telegram & Gazette to financial and editorial excellence. Under his leadership the T&G. as locals call the paper, was named newspaper of the year by the New England Newspaper Association several times. He also oversaw the opening of a new production plant in Millbury Massachusetts and the creation of the website Telegram.com.

Below are some excerpts from today's edition of the T&G which had this story about its future:

T&G for sale? Speculation abounds

FOR SALE: 142-year-old, once-thriving Central Massachusetts business. Future potential and revenue stream uncertain, but general agreement that product produced is valuable, even necessary. Business last sold for $296 million; current asking price TBD.

While there is no for sale sign in front of the Telegram & Gazette building at 20 Franklin St. in Worcester or its printing operation in Millbury, newspaper industry analysts say it is abundantly clear that the New York Times Co., the T&G's parent company, wants to divest itself of the region's largest daily newspaper.

Murray described the newspaper as "unique" among news sources available in Central Massachusetts. While he doesn't always agree with T&G editorial positions or ways some news events are covered, the lieutenant governor said, the newspaper is an "ingrained and vital part of our day-to-day lives in Worcester."

The Times Co. bought the T&G in 2000... While shedding itself of the Globe and its mounting red ink makes sense financially, the parent company's motivation for selling off the T&G is less clear. The newspaper that the Times paid nearly $300 million for in 2000 now carries an estimated price tag ranging from $10 million up to a figure in the $40 million to $50 million range, with the most common valuations in the vicinity of $20 million to $25 million...

That bid solicitation announcement has produced considerable speculation about possible buyers for the T&G and even public expressions of interest, albeit cautious ones, from a handful of potential suitors. Among the latter are Bruce S. Bennett, former T&G publisher who retired in 2006, and David G. "Duddie" Massad, principal owner and chairman of Commerce Bank & Trust.

Mr. Bennett, who now lives on Cape Cod and in Florida, said, "I'd have to take a close look at the books" before fully committing to the venture... Telegram.

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Publishing in red ink

GateHouse, owner of eight newspapers here, in mortal danger right now
Incredible debt load destroying profitable, local newspapers

By Walter Brooks

Perhaps the saddest news in the newspaper business today is that the media giants which took on insane debt loads in the decade before this recession to buy up hundreds of prospering, local weeklies will end up greatly injuring local news coverage as the giants go belly up.

Of all the media giants in America, none is in greater danger of doing that than GateHouse Media which owns eight good weeklies on Cape Cod and the Islands.

These weeklies are the only watch dogs over local town governments and committees.

The daily press doesn't cover them, nor does radio or capecodtoday.com. When GateHouse is forced by the banks to throw in the towel, what will happen to these great newspapers?

If they close too, who will make sure the municipal foxes don't start eating our chickens?

Big Money in Small Newspapers

A generation ago, before Fidelity Investments followed by Herald Media followed by GateHouse, smelled big money in small newspapers, the weeklies here were all owned by Cape Cod families who cared at least as much about covering their town as they did about getting rich. There were no shareholders to satisfy, only their own consciences and fellow citizens.

Except for Bill Hough in Falmouth and Hank Hyora in Chatham, all the newspapers here are today owned by either GateHouse or Rupert Murdoch's NewsCorp. The truly amazing thing is how well the journalists at these chain-owned papers have managed to cover the local news as their masters cut staff and demand higher profits.

The status of GateHouse today is catastrophic, and the third quarter of the business year starting July 1  is the worse one of all.

Here's what Steven Syre of The Boston Globe had to say about all this today:

The newspapers buried beneath the company's debts still make a cash profit on their own. They don't make a lot of money, and the cash they generate is shrinking fast. But they are still earners... GateHouse posted a loss of $32 million in its most recent quarter. But the business produced $5.7 million in cash earnings before interest, less than a third of the amount it reported in the same quarter last year.

There are two kinds of newspaper companies in business today, the ones that are struggling and the others that face mortal danger right now.

The factor that almost always separates one from the other is how a company viewed debt in recent years. Two of the newspaper industry's highest-profile financial disasters, Tribune Co. and the McClatchy Cos., both confront stupendous debt problems. The New York Times Co., which owns The Boston Globe, has its own debt problems.

But the smaller GateHouse Media Inc., measured pound for pound, rivals any of them when it comes to debt hangovers.

GateHouse was heavily dependent on credit from its earliest days as a small media company and grew much larger with the help of even more debt - obligations that threaten to overwhelm it today. The company is running up huge losses on paper, its stock has tanked, and no one is sure how it can pay back over $1 billion owed to investors.

"It does beg the question: What were they thinking?" says Tom Corbett, a Morningstar Investment Service analyst.

I'm not sure, either. GateHouse executives didn't call me back... Click The Globe to read the rest.

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