What will happen to this newspaper?
I don’t know. Nobody does
By BRAD WARTHEN
Editorial Page Editor
ONLY ONCE in my life have I bought stock all by myself, on purpose, with perfectly good money that was sitting safely in my bank account.
I bought 20 shares of Knight Ridder — the company that owns the newspaper I work for — at the impossibly low price of $62.65. It had been as high as $80 a share just a year before, and was bound to head that way again, right?
In October, it fell to $52.42.
I wasn’t the only one who was, um, disappointed. A man named Bruce S. Sherman, whose Private Capital Management company owns 19 percent of Knight Ridder’s stock (even more than I do) wrote a letter telling the corporate brass to put the company up for sale, or else. Last week, the company took a step in that direction. But while the stock has jumped up close to the price at which I bought it, nobody has rushed to scoop us up yet.
The irony is that people I meet have actually been asking me, as a member of The State’s executive team, what all of this means, and what’s likely to happen next. And I’m the one to whom other senior staffers have to speak very slowly and distinctly when explaining something financial.
Here’s the bigger irony: What I have to say on the subject is as valuable as what almost anybody else says, because nobody knows what’s going to happen (unless it’s already happened and they haven’t told me).
I’ve read what the analysts and the smart business writers at The Wall Street Journal and The New York Times and other publications have had to say. I’ve read memos from corporate. I’ve discussed it with my colleagues. And I’m about where I started.
Will the company be sold? I don’t know. If so, to whom? I don’t know. Will it be sold intact, or will the pieces be sold off to different buyers? I don’t know. What will it all mean to The State, and the community it serves? I don’t know. What will it mean to me?
I don’t know. There’s a lot of speculation, most of which will be shown to be nonsense when the whole thing shakes out.
While such companies as Tribune (as in Chicago), McClatchy and The New York Times are mentioned, Gannett — the only newspaper chain with larger circulation than ours — is seen by some as the only entity with the motivation and resources to swallow us whole. Then again, we could be bought by Yahoo! or eBay.
The experts say that what has driven this stockholder dissatisfaction is a set of dire portents for the entire industry. The retailers whose advertising is so critical to newspapers are consolidating. Readers are turning to the Internet and other free sources of news. Or they’re just not reading as much as earlier generations.
Experts also say newspapers are still a good buy, and that Knight Ridder is undervalued. The Journal said a “reasonable valuation range” for KR stock is from $70 to $100. It also said it was doubtful anyone would pay that. So much for experts.
I actually think that price range is reasonable (and am prepared to sell you a few shares in that range). I also think many of the evil portents are baloney. Readers can turn to the Internet all they want, and they’ll find newspapers already there, providing news content and selling advertising. Eventually, under current or future management, they’ll find a way to make as much money there as they once did peddling dead trees.
Ultimately, however the news is delivered, it will have to be paid for, either by subscription (a word that freaks out Web-surfers) or advertising. You see, it actually costs something to gather news. If newspapers, with their expensive armies of reporters, all of a sudden went away, you’d find the pickings of actual news on the ’Net to be pretty slim.
But hey, don’t listen to me. I don’t even know for whom I’ll be working in the new year. But I do know this: I’ve been here before.
I worked the first 10 years of my career for The Jackson (Tenn.) Sun, which was owned by The Des Moines Register Co. Some top shareholders in that privately held company tried to sell us to Dow Jones, which owns the Journal. That caused another major stockholder to try to sell the Des Moines paper to The Washington Post, and our little daily to The New York Times (or so the scuttlebutt had it). All those masters of our little universe were shown up in the end, when Gannett waltzed in and bought it all for $200 million. What this experience taught me is that once a company is in play, even those who think they’re driving the process have no idea how it will come out.
I’ve heard stories about what happened after Gannett took over, but I don’t know the truth of it, because I had left to go to work for Knight Ridder in Wichita — not because of Gannett, but because I didn’t get along with a new publisher Des Moines had sent us just before all the craziness started. (As it happens, I’m about to get a new publisher here, just as the uncertainty of a potential sale hangs over us all. Again. Interesting, huh?)
I was miserable in Kansas, and almost immediately after the company bought The State, I came here. As I said, I had gone to Wichita not because I want
ed to be there, but to work for Knight Ridder. Purely a career move. But I learned my lesson, and when I came here I came to work for The State — the largest newspaper serving the people of my native state. I pay little attention to what goes on at corporate (something I can do because Knight Ridder doesn’t believe in meddling in editorial policy). In my first interview for a job at The State, I said my ultimate goal was to be editorial page editor, which was where I thought I could be most useful. And 18 years later, here I am.
So what’s going to happen next? Well, for my part — and that of the team I work with — we’ll keep on doing our best to make the editorial pages a place where South Carolinians can come together to have constructive conversations about the critical issues that face us all, locally and statewide. We will still be motivated by the dream of a South Carolina that is no longer last where we want to be first, and first where we want to be last.
And we’ll do all that as long as whoever owns the paper lets us.
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Brad, What you just described is the predicament or perhaps the fortunate circumstance that any public corporation contends with in the free market. Industry consolidation doesn’t guarantee improvements in quality but does guarantee economy of scale. To the consumer, that means prices are moderated for your end product. On a personal level, it is unsettling to realize that your job can be vaporized with the stroke of a pen. But the survivors can end up working for a much stronger and healthier organization.
As a paying consumer of The State, who does not live in Columbia proper, I think there is a real problem with the paper living up to an image of truly covering the whole state. Much of the content is localized and that is understandable if that is where your subcription base is located. Your classifieds are not truly statewide if you peruse the real estate, autos, jobs, etc. Many of the editorials are also of mostly local import; District 5, NE baseball stadium, etc. So, while claiming the mantle of a state-wide paper is impressive, the reality is it is a Columbia metro. paper with some blurbs thrown in about outlying areas. I guess my question here is does that issue ever receive any discussion in the front office? Just curious.
Mr. Warthen:
I sincerely hope The State is bought out and you and your editorial staff are soon pursuing other careers. I hope for your sake the change forces you to find a real job somewhere that requires more skills and honesty than regurgitating ideological pseudo-think from the New York Times while pretending you are not the captive of ideology. Your leftist and dihonest editorial page and reporting has been an anathama to independent thinkers in South Carolina seeking real solutions to our nation’s problems. We are tired of the dishonest promotion of the same tiresome liberal shill that has precipitated our nation’s steep decline in everyting from the colapse of the public schools system to open borders immigration to out of control spending at all levels of government.
I realize the media is dominated by leftists like you and that any change will probably be just a change in cast and not a change in the ideologica bent of The State, but at least we won’t have to read your self-congratualtory babble about how fair and honest your newspaper is and how you agressively seek and report the news. These misprepresentations fly in the face of your news black-out on such minor topics as mass illegal immigration into our state and nation, the exploding national debt, incompetent school boards, and the environmental impact of the population “growth” you constantly promote. I also will not miss your endless mantra of taxing the middle class to death to pay for pork barrel projects you personally favor and liberal social engineering schemes that have been proven failures for decades. It’s a retorical question but have you ever once asked youself if your religion (liberalism) had had anything to do with collapse of the public school system? If you have, one would never know it from reading The State.
I will believe it when I see it but if the Knight Ridder monopoly in the Midlands is broken, I say good riddens!
Brad,
Welcome to free-market capitalism my friend. The big fish eat the small fish. I don’t suppose that your corporate buddies at Trelys, The Chamber of Commerce, and the Palmetto Institute have the cash on hand to buy The State, but in your case, I wouldn’t worry too much. All you have to do is to serve your new masters as well as you served the old ones. There’s no guarantee that they’ll be keeping you around-but gee, given your track record of obsequious corporate servitude, why would they find a new servant?
Just keep pushing the “private-public partnership” and your anti-union, anti-democratic, supposed “centrist” non-ideological ideology, and they’ll love you! Since most people have wised-up to the war, you may have to stifle the neo-con rhetoric, but who knows, maybe Exxon Mobil or Halliburton will buy Knight Ridder. You may be setting yourself up for a big promotion! Perhaps you’ll be allotted better quarters. How does a multi-million dollar house on the lake sound to you? The possibilities are intriguing, aren’t they? There is one caveat however, you may have to brainstorm some new euphemisms for the Corporate State in order to sell it more effectively to the public. I have faith in you though-you can spin it with the best- wrap it up in a great big American flag and call it patriotic. You can do it Brad.
http://www.boycottthestate.com
P.S. Maybe you’re not so bad after all. Since when did you become a leftist? That’s news to me. I guess that it could be even worse. Dear Reactionaries, on mass illegal immigration and the exploding national debt, please look in the mirror and to your Fuhrer for explanations. Yikes!
Brad, The WSJ Opinion Journal had this to say about KR newspapers in general (excerpt follows) – Knight Ridder has been publishing mostly second-rate newspapers for as long as anyone can remember. Its strategy has been straightforward: Leverage de facto monopoly newspaper status in individual cities into ownership of the classified advertising business in those communities. With high-speed broadband and wireless access now a fact for most Americans, consumers are no longer at the mercy of second-rate information providers.
Brad, the only real barrier to entry in the newspaper business seems to be owning a press, not the ability to gather news. Bloggers and websites alike gather news every day. Consumers rely on news outlets to filter and editorialize news for them, and when they don’t like the news as it is presented, they go elsewhere.
Major ewspapers are going away because
1. Fewer people can read English, much less write it. Yet the major newspapers support the ghetto lifestyle and illegal immigration which produces no new readers.
2. Media consolidation was about cutting costs by reducing quality. Local reporters are replaced by central news and feature stories, most of which have no interest to local readers.
3. Television provides instant news. Newspapers, which could offer in-depth analysis as an alternative to the replaying of images and sound bites, got rid of those reporters and feature writers, who went to the news weeklies. The papers print the same shallow slogans that they got from the television.
Yeah, Dave, I saw that (the “second-rate newspapers” piece) Saturday, and tried to link to it from my column. But the WSJ has made it all but impossible to link directly to a specific article. I thought I had figured a way around it, but I just checked, and when you click on my link, you just get a search page. I’ll keep trying to figure that out.
Anybody out there have any tips?
Lee, earlier contributions to thread show you have a point in #1…. And all this time I thought the State showed admirable “balans.”
I don’t see much point in debating whether or not the State is a Columbia newspaper or a statewide one…this argument is also going on over at Laurin Manning’s blog, precipitated (of course) by the USC-Clemson game. To me it’s obvious that it is a Columbia paper, covering state issues mostly from the perspective that the Governor and Legislature do their work (or their lack of it) in our town. Why shouldn’t Columbia have a paper just for itself? Greenville and Charleston do.
I’m also a little perplexed that folks evaluate the State so negatively (from either the left or the right) on the basis of its coverage of national news and its perceived editorial slant. If I have a gripe with the State, it’s that coverage of national and international news is pretty slim, mostly just the headlines. But then again, I rely on NYT and other sources for more coverage there. So my feelings about the State would be basically the same regardless of its political leanings. That is, as long as its coverage of certain areas of local concern remained strong.
Lee, regarding your point #2, I think the State probably does face those pressures but does an admirable job covering local issues. Here are three examples of writers at the paper whose work I find contributes a great deal to our community. Naturally this reflects my personal interests in the arts and in the environment, which Lee might feel reflects my support of a “ghetto lifestyle.”
Dave, regarding the WSJ quote: I’d expect them to be pretty snooty about the quality of just about any other newspaper. I’d like to see how they would do given the budget constraints of some of these mid-size-city papers. To name one other K-R paper, I don’t think the Charlotte Observer is second-rate. Just witnessing them being repeatedly called “agents of Satan” back in the day for exposing Jim Bakker was enough to make me love them forever.
But I digress…Dave, I’d like to share your (or WSJ’s) confidence in broadband and wireless access being “a fact for most Americans.” But the digital divide is real and will need to be seriously addressed if news is going to increasingly be disseminated online in the future.
Whatever happens,I just hope for harder crosswords and the continuation of “Mary Worth”.I have learned so many life-lessons from her.
Those of us who have read The State for decades cannot fail to notice how much the shallow fawning of the current staff towards Ted Sorensen is to the infatuation of their predecessors with James Holderman and his grandiose schemes.
Yeah, that Ted Sorensen was one heck of a presidential adviser, definitely one of the best and the brightest. I haven’t read any of his books, but we toadies at The State just love to fawn on him anyway.
What that has to do with anything, I don’t know.
Phillip, That was the WSJ take on broadband expansion but inevitably they have to be correct. Advancing technology continues to get more cost efficient and the old technology fades away. E.g. floppy disks, tube TVs, thermal fax paper, etc. Even the poor have touchtone phones now. The vendors can only support old technology for so long.
As for The State, Brad had noted some time ago that he would push for a fully electronic version/subscription. That is really the answer for a statewide paper. With a totally electronic option, The State could have an Aiken version, Greenville, Florence, Charleston, and even a Clemson version. Imagine that, a sports page focused on the Tigers day in and day out. That way, the electronic classifieds are fairly local as well.
As for the editorial slants or bias, Brad’s page is left of center but nowhere near the likes of the Boston Globe, NY Times, LA Times, and others for being leftward.
Moon was full last week.
Brad resorts to silliness again, playing dumb, to avoid examination of his paper’s refusal to question any spending scheme by the current USC president, just as they did with the prior ones.
I recommend renting the movies, “Music Man” and “Elmer Gantry” for the holidays.