A friend of ours used to work for one of the newspapers in the McClatchy chain, knew a number of the executives, and about them he had a remarkable thing to report:
They weren’t obsessed with the profit margin. They wanted profits, sure, but they were just about as concerned with putting out quality newspapers.
Shocking as this may be, this intelligence matches with the actual newspapers Sacramento-based McClatchy produces. The Tacoma News Tribune, its largest in the Northwest, is a quality paper, and the Tri-City Herald at Kennewick has shot up in quality since its takeover in 1979 from local owners as well. There’s no lack of quality in its other properties, either: Those include the Sacramento Bee, the Minneapolis Star-Tribune and the Anchorage Daily News. (It owns 11 papers in all.) In journalist circles, McClathy long has had the reputation of being a class act.
Will that reputation survive what is happening now – the most ambitious move in its history?
What is happening is its proposed takeover – evidently agreed to by both companies -of another newspaper company, Knight-Ridder. This is of particular note regionally because Knight Ridder owns outright three important regional newspapers: The Boise Idaho Statesman, the Bellingham, Washington, Herald and the Olympian in Washington’s capital city, which it only recently purchased from a third company, Gannett. K-R also owns slightly less than half-interest in the Seattle Times.
Knight Ridder is a big company, trailing only Gannett in the newspaper businesss. it used to have the reputation McClatchy has now: a much smaller company which owns a few profitable newspapers but plowed resources back into them to make them top-quality. As Knight-Ridder grew, as it piled up debt amid its big purchases and as its direction increasingly was set by large investors and Wall Street, its focus leaned ever more strongly on profitability. Newsroom budgets were slashed, and as circulation faltered the corporation became snared in a deadly circle of endless demands for ever-higher profits in an industry that wasn’t growing, while giving the consumers less and less. It was a dead end, and now we’re seeing its end.
Evidently McClatchy, which has avoided that kind of ambition and that kind of trap, thinks it has a solution to the problem. All of us newspaper readers certainly can hope so. But Knight-Ridder’s corporate offices were not staffed with fools; the problem was systemic and structural, not the result of a single bad decision or two, certainly not foul play by a bum CEO. The trap Knight-Ridder entered hasn’t been solved yet, and McClatchy – which will be assuming a large debt, will be much more reliant on large investors and will be far more closely tied to Wall Street than it has before – will be hard pressed.
For the moment, there’s prospect of a brighter day at some of the Northwest’s papers: One can imagine some newsroom celebrations if the deal goes through.
The real trick will lie in keeping the cause for celebration alive.
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