Sunday, August 03, 2008

Where Did All The Money Go? Star-Ledger Employees Trying to Answer That Question

Newhouse Pulls Its Version of a Zell. Or is it a Singleton?

Most employees at the Star-Ledger in Newark, NJ, had made a Faustian deal of sorts with their Newhouse overlords. Don't unionize, and we won't lay you off. Ever.
Of course, ever meant so long as we own the paper.
But now we are in newspaperdom's version of the Dark Ages, at least the version where the accountants are ruling the day, and Newhouse wants to change the game.
Newhouse wants 20 percent of the staff of the Star-Ledger and Trenton Times out the door. If not, the Star-Ledger will be sold and the Times will be shut down.
The New York Times reported that Donald Newhouse, company prexy, claims both papers have been in the red for years, and may lose up to $40 million. If so, then the question is why would Newhouse put up with that state of affairs for so long?
It's hard to imagine the Star-Ledger bleeding that much cash. It has long been the 1600-pound gorilla of New Jersey journalism, stationing reporters in most of the state's 21 counties, packing its statehouse bureau with at least 12 reporters and editors and putting out a sports section that would be the envy of most.
Of course, the Star-Ledger was afflicted with the same ills that have befallen every other newspaper, and saw its circulation fall to 345,000. But that's still good for 15th-biggest in the country.
Cuts were made accordingly -- no Knicks beat writer, for instance -- but it's hard to imagine that the paper fell so far, so fast, when it routinely laps the competition.
As for the Times, the story is somewhat different, in that it actually still has competition, miraculous nowadays for a market its size. True, the competition is The Trentonian, a scrappy if undistinguished tabloid, but competition nonetheless.
That's never a good thing in an era of freefalling circulation and ad revenues. And while, even in this lousy economy, some fool, er, idealistic investor like New York Observer owner Jared Kushner, might have an interest in the Star-Ledger, it's doubtful the Times would find any takers in this climate.
It would be hard to imagine the Star-Ledger not being in the hands of the Newhouse family. Then again, nothing should be hard to imagine in the current climate. The Newhouse News Service, a once-formidable player in regional Washington coverage, is no more, and other dominoes in the family's empire could soon be lining up to fall.
All of a sudden that 1600-pound gorilla is looking like a 97-pound weakling.

No comments: