Here’s Our Weekly Look At How Newspapers Are Adapting To New Business Models: Is it Really Necessary For Journalists To Have An Office To Work Out Of?

Philip M. Stone July 2, 2008

Publishers continue to show initiative in coming up with ideas on how to adopt new business models to the running of their print business. For instance, the publisher of The Record in Hackensack, New Jersey is vacating the newspaper’s main building and as far as journalists are concerned, “I really view this change as ‘moving out to the field.’” He envisages mobile journalists working full-time out of the office.

Publisher Stephen A. Borg says that by closing the newspaper’s main office and distributing staff to another newspaper the company owns, The Herald News of West Paterson, the company can save some $2.4 million annually, eliminating electricity, cleaning crews and all the like necessary to keep a building going. But it is his thoughts on how journalists should, or should not, be housed that deserves more study.

“The move is not from one big office to another. The move is from one big office to the field. It is not that The Record has left Hackensack, we are now all over the market. I envision the MOJOS (mobile journalists) like a swarm of bees landing in different towns.” And he is a big fan of the concept of office “hoteling” – journalists must make a reservation for some desk time, meaning there will be a lot of sharing, but the concept cuts down on the need for desks, and thus the space those additioonal desks would require. 

Here’s a review of some other ideas from the last seven days – remember we do not include mass layoffs in this list, but rather new ideas on how to make things better:

• The Philadelphia Inquirer (broadsheet) and the Philadelphia Daily News tabloid) – both located in the same building but on different floors – are looking at ways to share editorial functions. The union is not necessarily opposed as long as there’s no “damage to the independence or personalities of the papers.” (Actually that’s not such a new idea – when this cub started his full-time reporting career at the San Jose News (California), a PM broadsheet sharing the same huge editorial office with the broadsheet  AM San Jose Mercury –  if a story hit too late for the News’ final deadline we’d still write it up and leave it for the Mercury.)

• The Minneapolis Star Tribune defaulted on a quarterly interest payment to holders of $96 million of second tier debt. A required payment to the holders of $400 million of senior debt was paid. The newspaper says it has the money to pay the missed interest payment, but it appears to be playing hardball in trying to get the debt restructured.

• The St. Petersburg Times (Florida) doubled its newsstand price in some locales, raising it by 30% in others, but the bottom line is the newsstand price is now 50 cents. Home delivery was increased by 10% to $4 a week.

• Centralization is the keyword for the New York Times Regional Media Group. That means for the Star-Banner in Ocala, Florida ad production shifts to a site in Tuscaloosa, Alabama, with six of the 12 advertising staff in Ocala losing jobs – they can apply for severance or try and get a position at the Tuscaloosa facility.. The newspaper had previously shut down a classified call center, outsourcing that job.

• At the Ventura County Star (California)  the business section will no longer be a stand-alone, the Monday paper is being cut back to four sections and there are cutbacks in news sources (wire/syndicates).  Editor Joe R. Howry   doesn’t gloss over the reasons why – “We’re not trying to fool anybody with phony catchphrases like ‘new and improved’ or ‘to better serve you.’ Beginning Monday we are eliminating some things from the paper, it’s as simple as that.”

• In an effort to save some 25% of the projected $600,000 increase in the price of newsprint this year, the Tyler Morning Telegraph (Texas) Tuesday reduced the width of its pages. Publisher Nelson Clyde IV said, “Reducing the width of the newspaper is an evolving trend taking place at newspapers across the country.”

• The Chicago Tribune says there is big money to be saved by limiting office supplies that can be bought, the idea being to save some $500,000 a year. Gerald Spector, the company’s chief administration officer, says the newspaper spends some $3.5 million annually on office supplies. Cross-town competitor Chicago Sun-Times thought it was a bit rich that Spector would send out such a message considering he drives to work a 2007 Lamborghini Gallardo Spyder worth some $235,000.

And if anyone needs reminding of why these changes are necessary then look no further than to blogger Alan Mutter who has done his homework figuring out that the value of 11 US publicly traded newspaper companies has dived by $23.7 billion (yes, that’s billion) in the first half of this year. And to show how dramatic things have now become he says that values have fallen almost as much so far this year than they did in the prior three years put together!

To prove the point, Gannett closed Tuesday down 3.92% at 20.82. Is it really possible the largest US newspaper publisher will soon see its shares in the teens? Who would have believed it? And then there is McClatchy, as if the short sellers aren’t enough, Deutsche Bank switched its hold recommendation to sell and the shares ended down 7.08% at $6.30. In the past couple of weeks alone the shares have fallen 27%.

If the McClatchy family ever thought of taking the company private again surely this would be as good a time as any? Unless, they, too, believe this is not the time to buy newspaper shares.