By Joel Warner
By Michael Roberts
By Alan Prendergast
By Michael Roberts
By Michael Roberts
By Amber Taufen
By Patricia Calhoun
By William Breathes
In the month or so since the announcement of a proposed joint operating agreement pairing the Denver Post and the Rocky Mountain News, staffers opposed to the plan have seldom voiced their objections in the press, to absolutely no one's surprise. Privately, though, many remain plenty pissed off, ranting that the folks at E.W. Scripps, the News's parent company, lied for years about losses before exaggerating them in its JOA application and made no attempt to sell what some see as a very marketable property: a circulation leader in an area that's booming.
News bigwigs will never plead guilty to these charges, but that doesn't make the accusations any less true. Last September Alan Horton, the senior vice president for Scripps's newspaper division, told Editor & Publisher that the News was "cash-flow positive" -- a far cry from the $19.7 million loss for 1999 that was claimed in the JOA paperwork. More recently, in an endless Q&A published on May 21 in both the News and the Post (were they preparing us for the time when there'll be just one Sunday newspaper?), Scripps CEO Bill Burleigh made it seem as if his baby had sucked down still more red ink, declaring that shareholders had poured "$250 million in cash" into the News over the past fifteen years "for which, to this day, they have received zero return."
Yet in the same interview, Burleigh not only implied that Scripps hadn't shopped the News, but pointedly announced that it was "not for sale." Obviously, the earnings guaranteed by a government-supported monopoly like a JOA hold the promise of far greater returns than a humble purchaser could possibly offer.
Of course, Scripps doesn't have to prove that it tried to peddle the News; the Newspaper Act of 1970, which Maryland-based newspaper analyst John Morton says was designed "to help newspapers skirt the anti-trust laws," doesn't require any evidence in this regard. Morton, who writes a weekly business column in the American Journalism Review, adds that a good investor might well have been impossible for Scripps to find. "Over the last twenty years, the only buyers for weak second newspapers in markets -- and despite its circulation figures, that's what the Rocky is -- are companies that aren't very sophisticated about the newspaper business. Take Time Inc., which bought the Washington Star in the late '70s. At the time, I wrote that it was the dumbest decision of the year, and three years and $35 million in losses later, they agreed and shut it down."
Such realities no doubt made a JOA significantly more attractive to Scripps, as did the Justice Department's reputation as an easy mark; the department has approved every JOA put forward since the passage of the Newspaper Act. But this history hasn't prevented various organizations from trying to fight JOA proposals in other cities -- especially unions, whose members often wind up paying for cost reductions and consolidation with their jobs.
Understanding that the unions are the biggest potential obstacle to a cash bonanza that even Regis Philbin couldn't come close to matching, the Post and the News have been going out of their way to romance area reps. Carol Green, vice president of human resources and labor relations for the Post (and ex-wife of columnist/pet worshiper Chuck Green), says she met with union officials for ninety minutes the day after the JOA was announced. Another get-together involving these parties took place on June 5, shortly after the announcement that Green (Carol, not Chuck) was taking over the human-resources chores for the Denver Newspaper Agency, the entity slated to oversee business operations at the publications following the approval of the JOA. The fact she's the first executive to be hired by the agency indicates that preventing war with the unions is job one.
The articles about the latest chats published by the papers on June 6 were typically content-free, focusing on peace, love and understanding -- and Tom Botelho, spokesman for MediaNews, which owns the Post, takes the same tack. Because the JOA calls for the publications to maintain separate printing plants and editorial facilities, Botelho thinks overall job losses will be minimal, and he repeats the contention that most advertising, management and circulation positions that will vanish following the merging of departments can be handled through attrition. "Right now we're looking to hire," he says. "We have over a hundred openings."
That won't be the case for long -- but to date, no organized union resistance to the Post-News JOA has arisen, and reps have kept unaccountably quiet. Tony Mulligan, administrative officer for the Denver Newspaper Guild, which represents 1,400 employees who work in editorial, advertising, circulation, business and maintenance departments at the two papers, will say only that "we don't have enough information on the possible impact, so we need to collect more information so that we can make an educated decision" about JOA policy -- a statement that's positively bold by comparison with the quotes he's given to the Post and the News.
Nevertheless, the majority of union workers remains wary, and for good reason: Dean "Dinky" Singleton, CEO of MediaNews, has gained a well-deserved reputation for increasing profits at his papers by cutting pay and positions. For example, after Singleton bought the Post from the Times Mirror Company of Los Angeles in 1987, he convinced workers to accept a multi-year wage freeze and return a salary increase that was part of their previous contract by arguing that the paper might go under otherwise.