Content Bridges

L.A. Times: The Inconvenient Poster Child

Is the L.A. Times the new ground zero of newspaper staff cuts and frightsizing? Los Angelenos, of which I am one by nativity but not choice, may think so, imagining L.A. as the center of everybody's universe. It's not, of course, but the saga of the Times has been one of the more remarkable of the last decade and may be one good, if inconvenient, poster child of the debacle.

Tuesday, I was part of group talking about the Times, and how representative its tribulations are of the national newspaper malaise. The forum was KCRW's nationally syndicated "To the Point" program, hosted by veteran L.A. broadcaster Warren Olney. The topic: "Newspapers in Big Trouble: Should Americans Care?" Great question, if one incompletely answered.

While the web's a great sweeper-up of all news, it does miss quite a bit, including any kind of transcript coming out of public radio public interest programs. I believe these transcripts are produced -- and sold -- through media monitoring companies, but they are not available on the web. Hey Sergei and Larry, how about getting to all the world's info, like now? [Addendum to this point. A reader passes along that Everyzing, a voice-to-text translator company, offers a relevant free service. It's not quite a transcript -- lots of misspelled words, a little garbling -- but it's useful and does point to relevant time intervals in the broadcast. But we still need better.]

New York Times news trade reporter Richard Perez-Pena and I shared the hour with two L.A. Times editors, one current, one former, and one culture critic. There was a bit too much Internet-as-villain, but the program produced several statements worth passing on:

• L.A. Times editor Russ Stanton, appointed in February into a job with the half-life of an amateur tiger trainer, believably said all the right things about reinventing the newsroom and the paper in light of the tough times and hard budgets. When Warren Olney asked him how much money the new 15% newsprint cut and 150 headcount cut in the newsroom would save, he was, unfortunately flummoxed. He said that the money people were more after heads than money anyways, which has a half-ring of truth. Money -- actual dollars -- saved is all Tribune and its bankers care about at the moment. Russ did offer these interesting metrics on advertising. He said print ads have an 80% margin, while online ads only have a 20% margin. Those are interesting numbers, ones that I haven't heard in all the discussions of dimes-instead-of-dollars, internet-compared-to-print monetization. Overall, I think Russ' expressed optimism is heroic, a captain against the tide of history. Like Janet Coats' Interactive Newsroom restructuring in Tampa, smart editors are really going about reinventing the craft. (Fascinating excursion into Tampa Tribune intern Jessica DaSilva’s blog post on Janet's restructuring (and layoff) talk to the newsroom, the reaction to it in the blogosphere and what it tells us about deeply rooted problems of the trade here by Jay Rosen, at PressThink.) The problem they face is that no near-term reinvention will produce a product that earns the money to pay their currently staffed newsrooms. Yes, they can build better reader-pleasing products that help ramp new revenues in the new medium, but we're talking a ramp of several years at least. The larger money problem is one that must be solved, in part, beyond the bounds of the newsroom, and even of the ad departments.

• Culture critic Lee Siegel opined that journalists need to take a stand against the madness. He suggested Times staffers and other Tribuneites strike against Sam Zell. It was a bit "Cradle Will Rock"-like for me, stirring, but non-strategic. I think Sam would like nothing better than all those highly paid staffers walking out. God knows the Clear Channel guys would love to try programming the whole chain out of a low-cost center like upstate outstate (!) Minnesota or, in fact, Mumbai. It's a sad fact that solid, almost civil service-like professional middle class jobs in newsrooms are going away, being replaced by stringer-like arrangements that harken back to the beginning of the last century.

• John Carroll, the Times' Pulitzer-prize-winning editor from 2000-2005, was asked by Olney whether his quite-public resignation over staff cuts had made a difference. "No," John answered directly, saying it did make him feel better. You could feel his pain when he said that he could have cut more had he seen a plan -- a strategy -- to a brighter future. Instead, he said, it was just a slow panic. Unfortunately, most editors have been there, and expected that someone above their pay grade had a plan. Slowly, the realization is dawning: behind the curtain, there's no wizard, just Dean Singleton, Sam Zell, Gary Pruitt, Arthur Sulzberger, Mary Junck and other CEOs stuck in the center of a currently unworkable Rubik's Cube.

We didn't much talk about it, but the Times has been quite a peculiar case. Yes, it's easy to lambaste the current cuts, but the Times' issues run so deep and so long. Some think of the old Tribune, last run by Dennis FitzSimons, as an ogre. In truth, though, Tribune management long took a halfway approach with the Times, pushing, but not to a conclusion that satisfied anyone. In buying Times Mirror for $8.2 billion in 2000, it saw real synergies it could achieve by melding old Tribune papers with the new ones.  It pushed on those synergies, but the Times culture pushed back. (It kind of reminds me of the battles between Knight Ridder CEO Tony Ridder and Pulitzer Prize-bound editors at the Philadelphia Inquirer.) Some battles won, some battles lost. Some misguided, others quite sensible.

Call It Frightsizing

The news is out: Newspaper companies can no longer afford reporters and editors. Today's L.A. Times announcement is the latest to catch a news cycle of public attention. As well it should. A 17% cut -- 150 newsroom jobs -- is an unnatural disaster. It's the kind of news that shocks, if briefly. Because it is the L.A. Times, it's more shocking nationally than last week's cut at the Hartford Courant (25% or 58 newsroom jobs) and at the Baltimore Sun (about 20% or 55-60 jobs). All are Tribune-owned papers.

These cuts, and more at other Tribune papers, are a part of strategy, the new Tribune management tells us. It's "rightsizing" its papers to meet the economic realities of the day.

"Rightsizing" is one of those words management slings about when it wants to make it seem like it's making intelligent decisions in tough times. Sounds better than "panicking."

To describe the current round of staff cuts, though, there's a better word: Frightsizing.

Frightsizing means reckless cutting, hacking into one or both of the key elements of what news publishers will need to make it in the digital age. #1 is the newsroom -- or shall we say, content production -- staff. Content is what will make publishers money online, and as experienced, authoritative staff is lost, so will be lost some of the potential of what the new news company can be. #2 is the local sales staff, people who can grasp the out-sized sales/distribution opportunity of measurable, digital commerce and multiply publisher revenues. Frightsizing not only cuts deeply into near-term potential, it instills in the survivors fear and loathing, hardly qualities that win in hyper-competitive markets.

LAT Publisher David Hiller can talk about getting staff down to a "sustainable" size, but the truth is no one's got any idea what sustainability looks like. With increasing forecasts that the US economy will stay in the doldrums into '09, publishers are really just bailing water as fast as they can. The leaks (in print circulation, in print ad revenues, in newsprint costs and in slowing online revenues) are all widening. So all publishers are now cutting rapidly, with newsprint finding its predicted fate as an adjunct to the Internet, rather than to the opposite fiction too long held onto by news execs.

Really, given their company structures, they have little choice. You can see the must-pay checklists in front of publishers:

• Operating costs, with staff as the biggest and newsprint and ink coming in second;
• Capital costs, as they struggle to modernize production systems to meet new multiple-platform realities -- and still buy trucks to deliver the legacy product that still produces 90% of their revenues;
• Payments on debt;
• Dividend payouts to shareholders, payouts that most companies have increased (in the vain hope of satisfying investors) as their fortunes have declines;
• Funds to buy back a few shares here and there, again in vain hope of bolstering share price.

It's a daunting list, and one that nobody can meet with today's revenues. It wasn't always this way. Recall that three years ago, the profit margin in the industry still stood at about 21%, a number lusted at by many other companies in many other industries. Most companies had some semblance of an opportunity to make a bold moves, halving that margin and creating a real strategic plan to make a transition into the digital age with their companies largely intact.

They could have made better decisions to play the transition. Instead the transition is now playing them.

Certainly, the New York Times, the Washington Post, McClatchy, Scripps, Gannett and Belo come to mind as companies that are trying hard not to panic, not to frightsize. The cuts at all those companies are real, but you have the sense that there's an appreciation of retaining key assets.

Tribune, with its unconscionable $12 billion-plus debt, is the poster boy of frightsizing. Calling the new Tribune an employee-owned company is high parody, when those "owners" are being shown the door in massive numbers. You can place bets on whether the frightsized Tribune paper employees will outlast the real estate being shopped out beneath their feet. But for now, it's a horror show without a Hollywood ending in sight.

Related Content Bridges:

"LAT Madness is Brand Suicide"

"What's Wrong with Tribune's Math"

More Tribune, here

McClatchy's Guantanamo Series Makes Timely Point Amid Cutbacks

There are two kinds of newspaper stories these days. One kind is the old-fashioned one that tell us something we don't know. The others --- now feeding on themselves in near-frenzy -- tell us about the unabated decline of the newspaper trade itself.

Sometimes, the cross paths, as if in irony, or in warning of how closely the two kinds of stories are connected. (On the timing, it seems like it is coincidence. Says McClatchy VP/News Howard Weaver: "While the timing of the Guantanamo project is of course inadvertent, I do think it's a worthy counterpoint.")

Take the first kind of story. McClatchy's Washington Bureau released Day One of a five-parter on
"Guantanamo: Beyond the Law" for Sunday publication. It got a good ride on Page Ones around the country and was well picked up on broadcast. Its summary minced few words:

An eight-month McClatchy investigation of the detention system created after the Sept. 11 terrorist attacks has found that the U.S. imprisoned innocent men, subjected them to abuse, stripped them of their legal rights and allowed Islamic militants to turn the prison camp at Guantanamo Bay, Cuba into a school for jihad.

At first read, it looks deeply reported, well-told and plainly on point to last Friday's Supreme Court ruling.

Then take today's story: McClatchy is cutting 10% of its staff, company-wide, with deep cuts at the Miami Herald (17%), the Charlotte Observer (11%) and even at corporate flagship Sacramento Bee (8%). That's 1400 employees total. The revenue declines are described well by Alan Mutter, here, who argues they probably won't be enough.

The Tom Lasseter-written Guantanamo series reminds us of the sterling contributions of the Knight Ridder bureau in the earlier days of the Iraq War. After the New York Times had stumbled in its own war run-up and war coverage, the KR bureau distinguished itself by asking the tough questions, doing the tough analysis and devoting sufficient resources to the story of the decade.

So what's happening now in that Washington Bureau, recalling that McClatchy merged its own bureau with KR's after it bought the company in 2006?

I traded email on this busy morning with Howard Weaver, whose own explanation of today's cuts is worth a read.

In short, today's McClatchy bureau is well down from the combined total of KR and McClatchy. And it is has many challenges, but Howard paints the picture of a bureau struggling to get out the best journalism it can, as evidenced by the Guantanamo series.

Before the KR purchase, the McClatchy (then 11 papers strong) bureau had 15 staffers. Knight Ridder's (31 papers strong) had 45 staffers. Today, the McClatchy bureau -- with 30 papers in the company after various divestitures -- has about 47 staffers.

"The emphasis was different; under KR regional reporters were tied to their papers (KC, Miami etc) and simply housed in the bureau," says Weaver. "Ours are full-fledged bureau staff, although chiefly responsive to their paper."

The pressure is evident.

"We have put two foreign positions on ice," explains Weaver, "filling Mexico City [the office remains open with local staff and hosts rotating journalists from McClatchy papers] and delayed opening a planned new bureau in South Asia (Islamabad or Mumbai were prospects)...Neither is considered "off the books" but both are on hold." Weaver says recruiting is underway for two other open jobs.

In addition, McClatchy is taking the scalpel to the management. Says Weaver: "David Westphal, our Washington Editor, will not be replaced when he leaves later this summer to follow his wife to her new post at USC/Annenberg; current bureau/MCT management and I will take up that slack, which enables us to keep more firepower on the front lines."

The front lines. They are easy to forget about as the other kind of story dominates. Yes, McClatchy may have more cutting to do, but today -- this week -- it's refreshing to see one US newspaper company making news for its journalism and not just for its cutting plans. There is no one way out of this jam, but, in the end, journalism businesses have still got to believe that the journalism adjective is still an important one.

LAT Madness is Brand Suicide

I'd like to read the Los Angeles Times manual on "how to deal with difficult situations." Though it's never been made public, it's clear it's been infiltrated by those disseminating disinformation. The result: no matter what seems to happen at the Times in the last several years -- old Tribune and new Zell-led Tribune -- we all get to witness some blow-out spectacle, the kind of spectacle such manuals are supposed to keep behind closed doors.

This week, of course, after Randy Michaels' newly announced Halfsies (50/50 edit/ad split) Strategy, the Times re-takes the spotlight. Word leaks out that the Los Angeles Times Magazine, one of the few remaining Sunday magazines, has been seized in a coup by the Times' business side. Its editors and writers are out  -- maybe there's a Planet Runway-like Journalist Elimination reality show David Hiller can sell to his new Hollywood friends (check out this good LA Observed piece on Hiller "being star-struck by the glamour of his adopted hometown"). Former InStyle and L.A. Style Editor Annie Gilbar will apparently head the new mag.

The decision to launch (re-launch) a new advertiser-friendly magazine in and of itself is no shocker,
and not a bad idea. The New York Times and the Boston Globe are just two of numerous well-regarded papers to plumb design, home, fashion and more, going after high-end and luxury dollars. Such magazines can be run by editorial departments; they can be run by advertising departments. The key is to clearly and prominently tell your readers who is producing the section. Readers aren't dummies; they take in the content for what it is.

But at the Times, of course, the situation had to blow up, handled in an unbelievably clumsy way. You'd think that the paper's recent historic memory over the secret Staples Center "sponsorship" and revenue sharing of and with a "special section" -- which cost the jobs of then-editor Michael Parks and then-publisher Kathryn Downing  -- should have been instructive, even if it did happen a year before Tribune bought the Times.

But, no, the Times managed to make the elimination of the L.A. Times Magazine (which had become monthly) and its replacement with an ad product another debacle. Why not close the L.A. Times Magazine, sending it to an eternal rest that most of its brethren have found in the last couple of decades. Then, have your business side launch all the high-demo magazines you want. It seems so simple.

Maybe, it's that Publisher David Hiller indeed wants to keep the name of the magazine intact, playing sleight of hand with readers. Maybe he's not sure yet. But he's managed to leave new (installed in February) editor Russ Stanton dangling in the wind, pleading that the name not being, shall we say, re-purposed. You could place bets on Stanton's half-life before this controversy, as the Times has managed an unprecedented turnover in its publisher and top editor ranks (well-chronicled here by Joe Strupp). Odds on Stanton's tenure shifted this week.

Why do things keep blowing up at the Times? My sense is that the place has two uneasy cultures, cultures that have always been uneasy with each other, but ones that are now colliding. 

What's Wrong With Tribune's Math

So, it's clear, that Randy Michaels knows how to draw attention. His 50/50 ad/news plan isn't exactly revolutionary, but it's become a lightning rod for the news industry, as it comes to grip with near-death experience.

Two weeks ago, Rupert Murdoch opined that print would outlive him, lasting (print!) another 20 years. Today, we had Steve Ballmer providing the half-life of 10 years for the newspaper, though the combo of the self-serving nature of the comment and Microsoft's Internet track record hardly make us mistake him for Nostradamus.

You can read MediaNews' Dean Singleton saying "It's time to get over it and move to a print model that matches the times." McClatchy's Howard Weaver, in a worth-reading Sunday post (the industry is really going 24/7!), was candid about the decline:

Revenues continue to be bleak, and it is increasingly apparent that fundamental shifts in competition and audience (combined with cyclical economic woes) demand permanent structural changes. Though many encouraging signs point us toward future success (total audience and online revenues are indeed growing at double-digit rates, for instance) the overall picture is undeniably changing.

Put it plainer: newspaper companies will make less money, get smaller and face greater competition. As a result, we’ll have to become more efficient, make smarter choices and allocate resources to our essential activities.

Overall translation: It's The End of the World As We Know It. Get Over It.

That's a big turning point, and it is now sinking in universally.

So now is the time to sort out real solutions from ersatz ones, an exercise that will consume many of us for a good while.

Which brings us back, most immediately, to Mr. Michaels' halfsies proposition.

I consulted one of my best sources, a highly experienced ad director -- we'll call him AdMan, to protect one of those still industry-employed.

He doesn't think much of the Michaels' plan.

"It's nothing new that he is proposing. I don't know how many long meetings I sat through, looking at sectioning, looking at how to run the paper more economically.....I'm skeptical he can take pages out [we believe Tribune wants to cut another 500 pages chain-wide each week] and do it in strategic ways. Fundamentally, he's right, but Macy's is going to say you're not going to put my ads in the B section."

The Newest Barbarians, Toting Spreadsheets

Sam, I get it. You're being aggressive. When you add to Randy Michaels' aggressive talk about cutting newspaper size and staff that "I promise you he is underestimating the level of aggressiveness with which we are attacking this whole challenge," you seem to be proudly announcing that the newest barbarians may well be inside the gates. I'm not sure who that impresses aims to impress -- your employees are fairly shell-shocked already -- but it does capture attention.

What I don't get is why the aggressiveness seems to take us back to 1980 rather than forward to 2012? (Though 2012 may seem even further away to Zell and Michaels than it does to Hillary Clinton.)

It's little surprise to keen observers of the new Tribune that more draconian cuts had to be on the way. Zell relied on this trading acumen, and luck, to create an auction for Newsday, and that netted him tens of millions more than most people will tell you the paper is worth. The Cubs, Wrigley Field and cable network assets are next, but the deepening downturn in the industry (and as of Friday, maybe the cyclical economy as well) tell us that those asset sales may not even be enough to get Tribune through 2009.

What is surprising is that in publicly announcing cutbacks, Randy Michaels, Zell's radio guy-turned-Tribune czar, is focusing on, of all things, PRINT.

Take his notion of how to make the papers more readable and sell more of them.

Michaels saying the papers will become more USA Today-like, with:

"a new look and feel in each market, emphasizing what people are telling us they want in the research: charts, graphs, maps, lists."

Wow. Great solution for 1992 perhaps, 10 years after USA Today turned the newspaper world, Pleasantville-like, from black and white to color. The problem with that is that USA Today is essentially flat last several years in circulation, and it's got a national base and multiplicity of hotel/travel programs to keep the numbers up. The biggest innovation of the last couple of years isn't the color weather map on USA Today's back page; it's Google's ability to map everything and anything, instantly -- at the customer's fingertips and choice, 24/7.

Which takes us to the bigger news that Tribune figured out that the problem is one of ratios, now believing that a 50/50 ratio of ads to news is right.

Michaels' reasoning:

"If we take, for instance, the Los Angeles Times to a 50-50 ratio … the smallest paper, Monday and Tuesday, [would be] 56 pages. That would be substantially larger than that day's Wall Street Journal. We don't think that's a bad value to the consumer. And we think that by doing that, and then by being able to produce less editorial content … we can save a lot of money by producing the right-size newspaper.

Let me hear that again. You're going to decide how much editorial content to produce by seeing how much will fit into the new downsized papers? You're going to ratchet down the amount of editorial content (and staff), leaving the decision of what you are going to give your print readers essentially in the hands of print ad buyers?

Surely, we can make good journalistic arguments about the folly of that. Journalism's never been mainly a quantitative business. But let's look broadly at "product." Would Randy Michaels, who rebuilt Clear Channel on a low-cost model, let the amount of radio ads sold determine how much programming listeners got? I don't think so; you've still got to have a consistent product for listeners or readers.

Readers are already fleeing newspapers -- and I'm talking about decades-long readers, not the young whom the industry too often blames -- because they see every day that less is less. This change, however it looks on a spreadsheet, will only hasten that decline.

That's a decline that is, at this point, inevitable anyhow. I give Michaels' credit in publicly announcing some thinking about how to justify cuts, but he could have put it more simply. People and paper are our two biggest costs, and we don't have enough money to maintain current levels of spending. That's less fancy, but more to the point.

What we'll soon see is "daily" papers becoming, uh, less daily. Monday and Tuesday editions are a sinkhole, with the latest evidence here, as MediaNews looks to those days as "quick-read" editions. Those days could soon be dropped completely, at smaller operations here and there. Anyhow, the whole notion of a daily newspaper is now obsolescent. It has taken way too long to get to 24/7 newsrooms and news output, but that's what the national players -- from CNN to the New York Times to the BBC -- have adjusted to. Even TBO.com, in Tampa Bay, has made a centerpiece of its new "Continuous News Desk" and committed a couple of dozen people (print, broadcast, web) to making it work.

The old daily paper is being -- as we watched Hillary Clinton's concession on Saturday and its instant analysis on TV and web -- replaced by the web.

Summer, 2008: The Smell of "Burning Furniture"

Summertime and the livin' is far from easy. Now that we're past Memorial Day, let's speculate on the summer that will be. It's a long time til Labor Day for the news industry. We've seen Rupert Murdoch, ironically drawing stark attention to his own advanced age -- and the question of what will become of his emerging digital empire -- in recently noting that print will out-live him. ("Print will be there for at least 20 years, and outlive me.") The London bookies might be having a field day with that one.

But for most publishers, the times just turn edgier and edgier. I asked a keen observer about the major strategies news publishers are considering as they face the changed business landscape. "Strategies?," he laughed. "They're too busy burning the furniture."

Burning the furniture? In June? Well, the industry has had a hard time separating out cyclical change from structural change, but those still working might hope some wood's left for winter.

Here are nine of my questions about the summer ahead. What's yours?

---1. At the New York Times, it's going to be a tense summer. Buyouts and layoffs have now taken out about 100 jobs, as the Times increases its dividend to try to retain shareholders. The new Harbinger/Firebrand board members are now inside the tent, poking at its corners. How soon will the Times management heed their calls to bite the bullet, sell ailing newspaper properties (Globe, regional group), buy a little time, save a little staff and invest more in the great digital future, which is the Times' salvation?

---2. Love the photo with David Hiller (left) and Randy Michaels (center), in Crain Chicago Business story.
Hiller, tried-and-true Tribuneite, is the ultimate survivor, but the expression says even his tenure as L.A. Times publisher is limited. The Times' publisher and editor change dramas have been quite public, but consider they've been churning through ad VPs about yearly for most of this century. Think what that does to the numbers (and you see why Tribune's own numbers are disproportionately down). Will David Hiller last out the summer or the year?

---3. We hear the grrrrrrrrrrrrrrrrrrrr grinding of teeth from large-player Gannett to small-player Gatehouse, down to a new low of $3.90 a share on Monday. As the Goldman Sachs report put it circumspectly: ""Our thesis that a focus on smaller, 'hyper-local' markets would serve as a counter weight to the cyclical and secular pressures negatively impacting newspaper industry revenue performance has proven only partially correct, as evidenced by the declining trend in same-story revenues over the last several quarters." In other words, is there no refuge out there?

---4. Why did US news publishers fail to follow other big US corporations in diversifying to international markets?  Look at the now-double digit decreases in US ad revenues -- 10% in ads overall in April; 20% in classifieds -- and you see that the US is the epicenter of the newspaper meltdown. UK, Europe and Japan are muddling along -- down a tad -- but much of the developing world from Eastern Europe to Latin America to South Africa to China and India is going gangbusters. Chains like the Irish-centered Independent News and Media and the Norwegian-based Schibsted saw this change coming and have invested way beyond their initial  comfort zones. Now they are diversified, and growing, while US chains see the double whammy of fewer ads and higher newsprint (expected to price up 20% year over year for the second half of 2008) costs.

---5. Will salvation be found in motherhood? "Soccer moms" might have been so last election, but momomania is sweeping news websites. Boston.com's ""Bomoms"," and the Orange Country Register's "OCMoms" are part of the profound move to niche. If general news still pulls in puny CPMs, sites are looking at profiliferating niche sites around them -- in this case, the fast-expanding, now dozen-strong Mama web chain (San Diego Mama, Houston Mama, DC Mama. The hard part - producing enough compelling content, engaging real community and getting the ad people sufficiently connected.

---6. How fast can we replace expensive staff-written stuff with user-gen? The economics are clear. Better to pay nothing for something that will get you 1000 page views than part of a professional salary. User-gen's not just about community engagement -- it's about cold, hard cash. As user-gen initiatives rage, look for more of them to get connected to newspapers' main publishing systems -- witness the recent Saxotech/Pluck announcement -- joining the two worlds of newsroom and user gen. One publishing system, monetized singly.

---7. How big a bandage will we need to blot the paper cuts? Much has been made of the news industry covering its own demise (that's what we do). But you have to admire the Google mapping/color-coding of the rampaging layoffs and buyouts by Erica Smith, here.

---8. How much workouts will the whiteboards get? Structural change is an order of the day. Sometimes highly strategic, perhaps, and sometimes Titanic deck-chair-like. Belo and Scripps have split themselves in halves, the Washington Post is re-doing print/online orgs and the San Diego Tribune is trying a grand experiment of putting it all together.

---9.  How loud will the Yahoo! be by summer's end? With AMP being touted by Yahoo as a salvation to newspaper consortium members' audience/ad targeting woes, its arrival by end of summer at MediaNews properties, among others, may be a cause for whooping it up. Of course, it is bound to be a  summer of High Anxiety (shout out to Harvey Korman)
at Yahoo and for those partnered with it at the hip and wallet. With Google gaining search ad market share, Yahoo and Microsoft, abetted by matchmakers like Carl Icahn, are being forced to do something. Yes, Microsoft's making a bunch of moves, but expect it to circle back around to Sunnyvale., especially given today's revelations that Jerry Yang may have rejected an earlier $40 a share Microsoft bid. Nothing's stopping Yahoo from moving on AMP and its implementation for now, but a Yahoo uncertain of its own future just adds to the newspaper summer worry pile.

Cablevision Moves Forward with First Home Run Game Plan

I've long compared the cable and phone companies on the one hand to the newspaper companies on the other.

Newspaper companies saw there business being upended by the Internet, made small bets and have lost out on the big ad growth the web has generated.

Telephone companies -- the successors of monopoly Ma Bell -- first consolidated and then saw that old vanilla phone service was disappearing, well, almost as fast as newsprint-based news. They moved into internet service provision and then into more lucrative broadband, acing out the many small companies that had at first parted the waters (some of which, including Infinet, were owned by newspaper companies). They invested heavily (and often clumsily) in mobile and have figured out how to wring many new dollars from all of us.

Cable companies saw that they were reaching a saturation point in their own penetration, and then felt the hot breath of the formerly telephone companies moving to offer .... cable TV. So they've gone after both internet service providing and local voice, understanding that boomers still want the comfort of the old landlines.

Triple Play, once a novelty, has become the standard. Cable + Internet + Telephone.

Now Cablevision's stuck out its neck, $650 million worth, to swing for fences.

Cable + Internet + Telephone + Newspaper. A combo that could give Cablevision an edge against Verizon, its biggest competitor.

A home run?

My betting is that it's one of the best labs for everyone in the news industry to watch.

What stands in the way of a big Cablevision win? In a couple of words: strategy and exectuion.

In strategy, Cablevision must move beyond the hazy notion of Long Island Convergence (some say the Dolans may have had a bit too much Long Island Tea in offering $70 million more than their competition for Newsday) to a true strategy. That strategy, in a nutshell:

---Create a new ad vision of how Cablevision/Newsday can serve local advertisers, from its Long Island home base to metro New York to southern Connecticut to northern Jersey. Providing advertisers reach to mass and targeted niche audiences, through cable, newspaper and internet is what must be done.
---Create a new content vision for how Cablevision/Newsday can serve local news readers, sports lovers, business observers and entertainment seekers. The company will have a newsgathering/production force of more than 500. The goal has got to be to get out of text/TV/audio silos, creating text and multimedia content, distributing that content to become dominant in its key geographic areas
---Connecting the ad and content engines to the wider web distribution world. The new independent-of-Tribune Newsday may well move out of its Tribune partnerships (nothing in release one way or another on CareerBuilder, Classified Ventures, QuadrantONE, etc.) and look at joining the Yahoo News consortium, among others. The Daily News is in it, but has no market exclusivity.

The Execution? Tougher than the strategy. It should be streamlining as many of the cost centers of both companies as possible, but doing that in a way that builds the company for success, rather than crippling it.

Yes, ad staffs and selling propositions can converge and yes, scribes and TV producers are really members of the same species. But the human dimension here is what's tough. Habit, tradition and skill set are all obstacles. As I wrote last week, someone is going to surmount them; Cablevision's just one of the newest and potentially most interesting to try.

For Rupert-watchers, the sale is something of an enigma. Why did it go this way less than a week after his public boast that he'd win the prize? Questions to be answered:
---Did Tribune's latest double-digit declines convince him that it really wasn't a prize at all, that the the Post's $50 million loss really wouldn't turn to profit, given both a bigger Newsday pricetag and the detiorating newspaper ad market?
---Is News Corp thinking that further investment in newspapers just won't pencil out?
---Back to the overpay question. Did Rupert overpay for Dow Jones and did the Dolans overpay for Newsday?
Both are long-term investments, and you can't make judgments based on today's pressures and short-term trends. This is all about real convergence and its value.

King of the City Journalism is All the Rage

Consider the new Big City American journalism and the emerging cast of characters owning it. It's a page right out of the history books when a few well-heeled titans controlled the press, and its new incarnation could have all kinds of implications for the Yahoo Newspaper Consortium, for AP and for the journalism start-ups near and far.

If Rupert Murdoch indeed knows more about who the next owner of Newsday will be than the rest of us, and I'd have a sense he does, that would make him Prince, if not King, of New York. Pending what may be obligatory regulatory review, given the anti-trust and FCC thinking of the moment, he'd own Newsday, the Post, WWOR-TV, WNYW-TV and the solidly NYC-centric Wall Street Journal.

Chicago is Sam Zell-land, as Sam bought the title King of Chicago along with the Tribune, WGN TV and Radio, Chicago Magazine, Redeye and CLTV.

The Bay Area is Dean Singleton's, by far the largest newspaper owner out here, owning about everything daily other than the Chronicle, which is owned by Hearst, his key business partner in many other markets.

Dean is also chair of the AP board, and Sam and Rupert have just joined.

I bet we'll see more. As the new Tribune peels off Newsday, and stares down the next debt payments, eyes are bound to turn to L.A. And there, too, might not a new Big Man in Town buyers emerge? Recall that David Geffen, Eli Broad and Ron Burkle were all in the hunt earlier for the Times.

In Boston, it's just a matter of time before the Times says good-bye to the Globe (paging Jack Welch); it's got to deal with the emerging threat to its core NY Times flagship by.....Murdoch, whose company is talking of synergizing his London Times and the Journal. (By the way, in a recent interview, former Times editor Howell Raines spoke of how the Jayson Blair scandal shelved plans to re-brand the International Herald Tribune with the Times nameplate. Great idea -- the Times now wins or loses as a global news franchise -- and why haven't the plans proceeded? There's little time to waste especially as the Murdochian armies mass.)

It's funny, isn't it, that pundits hypothesized that the Internet and associated technologies would democratize media and here we are back to the landscape of the early 1900s. Hearsts and Pulitzers and the rest changed journalism, started wars and elected presidents. Now undoubtedly, our media is much more diverse, but arguably getting more concentrated at the top end, where most of the ad revenue is and where the greatest bullhorns are heard.

Yes, daily newspapers' businesses are in a world of hurt, but those able to buy low, leverage the assets synergistically with emerging media or subsidize them to meet other business and political goals are in a great position. The brand value associated with the the L.A. Times, the San Jose Mercury News, the Chicago Tribune and Newsday, just to name a few, is still great, and can be harnessed in any ways new owners see fit.

What kind of impacts might such rapidly changing ownership portend:

Can Cablevision Turn a Triple Play into a Newsday Home Run?

It's easy to get lost in the current era of Big Man in Town Journalism. Zell. Singleton, Murdoch. Tierney. Harte. So much of the recent drama in newspaper ownership change has been driven by personality, as keep-it-in-road, rationale profit-seeking companies turn up their noses at the prospects of buying newspaper companies. It takes an outsized ego, an outsized wallet (your own maybe, but preferably someone else's) and a perhaps outlandish optimism to grab onto the horns of the bull and take off for a wild ride.

One current installment of that drama is playing out in Long Island, home of once-proud Newsday, a paper that innovated ahead of its day and then saw its fortunes cascade through the Times Mirror and Tribune funhouses. As Sam Zell stares down his first balloon debt payment, Newsday's hit the block, and an unusually crowded one it is. Isn't it great to see a bidding war for a newspaper company? It is highly enjoyable, if unique to market circumstance. With Murdoch's Post and Mort Zuckerman's New York Daily News in lethal competition, both have a hard time imagining the other getting Newsday and using it as cudgel in the war.

The weapon for each in that case is, of course, cost reduction -- a relentless streaming of cost in all departments -- ad, circ, production and printing and finance, not to speak of how newsroom synergies might be achieved. It's the other bidder in this case -- currently the high one -- that I think paints a more interesting picture of what the local "press" may become.

Cablevision has offered $70 million more than either Mort or Rupert, currently at $650 million, $150 million above its original offer. With Rupert and Sam increasingly better buddies (formally on AP board and informally, we can only guess), I would have put my money on that deal (and agree with Alan Mutter's notion of a potential Murdoch/Zell endgame, here). But $70 million is quite a differential, and for now, Rupert is saying he isn't going up. Further the potential of FCC review of his increasingly entangling NYC-area cross-ownership (the Post, WWOR-TV and WNYW-TV, Dow Jones and Newsday) would at least slow down and bring uncertainty to the deal. Sam Zell's bankers don't like uncertainty.

So that may leave us with a new attempt at....synergy. In fact, it could turn the emergent idea of Triple Play -- TV cable service, Internet service, local phone service -- into a Home Run, adding "newspaper" to the diamond.

In this new synergistic interpretation, we'd observe what new owners would see as complementary in combining Cable News -- including News12 Interactive.com (its cringe-worthy tagline -- "only in cable  not on phone company tv or anywhere else"; you need a password to get in unless you are a local cable subscriber) -- with Newsday. It's been done before you say, and you're right. In fact, Cablevision and Newsday themselves jointly produced a one-hour cable news program years ago. But it was too early and didn't pencil out. It's been done elsewhere as well, with mixed results.

What's changing now, I think, is that the time is coming back around to do it right and to make it pay. Is it a "TV-centric" time, as someone close to the Dolan family, who control Cablevision, said? TV-centric misses the point. It's more video-forward than TV-centric. News video is now here to stay. More than half of the US population has watched video within the last month; already in Britain, that number is now more than 90%. We're getting used to seeing video first, on our time, time-shifted, Apple TV-enabled, and through the Internet. The much-maligned pre-rolls and their children, "in-video" ads, are still highly sought after and fetching $25-35 CPMs, on average. We do like to watch. 

Look at most newspaper sites, and you see dabbling. The AP Online Video Network is so far populated on about 1800 sites, newspaper and broadcast. On too many, though, it's relegated downpage, and seems like an after-thought.

So what happens, in this new, coming age of convergence -- in which easily watchable video marries quick-read text and always-on opinion -- if you combine the resources of a Newsday and a Cablevision, which, too, counts hundreds of journalists in its newsrooms that span from northern New Jersey to southern Connecticut.