Showing posts with label Philadelphia Newspapers. Show all posts
Showing posts with label Philadelphia Newspapers. Show all posts

4/5/11

Editing, the Richness of Content, and the Current Limits of Web and Social Media

Editors matter.

The March 28-April 4, 2011, edition of the struggling news magazine Newsweek—which I admittedly have not read in years— provides some of the finest articles I have read in many months, illustrates the limits of online and social media, and shows why editors matter.

There is great benefit from both edited and unedited media and I don’t believe they have to be seen in dichotomous choices for the future of media. But I believe those who argue they don’t need to edited media doom themselves to narrowness and ignorance.

If I relied only on the links I receive daily from colleagues on Facebook, my news alerts for topics of interest, or digital listings of stories, I would miss the most important contribution of edited media—the service editors provide by reviewing and thinking about the world and putting journalists to work to provide a coordinated understanding of the available information. This week’s Newsweek epitomises that reality.

Although I often have my attention drawn to information and stories of interest from my social media, the pattern of stories and information sent to me would not have led me to Bill Emmott’s Newsweek story on the impact of disasters on politics, economics, and national psychology or Paul Theroux’s explanation of how Japan’s history has shaped its culture and how the generous global response to the earthquake and tsunami is forcing it to confront the fact that it is not alone and isolated in the face of geographical and physical constraints.

Had I relied on to the multiple news websites I peruse weekly, the ways they are presented and the ways that I search for news on them would not have led me to Newsweek’s fascinating story of the nuclear disaster at an Idaho test station in 1961 that may have been the result of a murder-suicide, its account of why a London murder has led to a boycott of Coca-Cola, or its account of why political ignorance in America is higher than that in European countries.

My point here is not that we should all be rushing out to subscribe to Newsweek (My apologies to Sydney Harmon, Barry Diller and Tina Brown), but that the functions of editors matter. Having someone look at the world and see ways that it fits together, have editors coordinate and incentive talented writers, and having editors create a collection of stories and information continues to produce value.

Those who believe that news, information, and understanding of the world can come through a disaggregated and uncoordinated flow of information and stories, much of which is not prepared by professional writers on a regular basis, miss the entire reason for the success of edited media over the past 300 years.

I do not wish to be construed as saying that online and social media do not make enormous contributions to our communications ability, but until they mature to the point they can support regular oversight and thought about the world and compensate professionals for whom investigating and reporting developments is their primary employment, digital media will not be able to replace the contributions of well edited print media.

After a decade and a half of digital media it is clear that we are able to move news and information to those platforms, but we are nowhere near the point we can shut off the presses without a great deal of loss of oversight and understanding about the world around our lives.

8/21/10

Bankrupt Newspapers Leave Employee Unions and Government Corporation Holding the Pension Bills

It has not been a good month for newspaper unions at bankrupt newspaper companies or the government corporation that insures pension funds. As part of their reorganizations, a number of bankrupt newspaper firms are not paying money owed union pensions or are quietly letting the guaranty pick up the tab for retiree costs.


  • Unions of Philadelphia Newspapers LLC (The Inquirer and The Philadelphia Daily News) were forced to accept 12 cents on the dollar for the $12 million the bankrupt company owned to employee pension plans as part the reorganization plan.
  • The Chicago Sun-Times off-loaded $49.1 million of its underfunded pension obligations for 2300 retirees and employees to the Pension Benefit Guaranty Corp. The paper and it suburban subsidiaries were purchased out of bankruptcy without the new owners assuming the pension obligations.
  • The Dayton News Journal dumped $15.4 million in underfunded pensions payments on the Pension Benefit Guaranty Corp. , which will ensure 1,100 current and former employees receive benefits owed to them. The newspaper and its assets were purchased out of bankruptcy by Halifax Media, but it did not take on the pension liability.

The Pension Benefit Guaranty Corp. is a federal corporation designed to protect pensions when company-run pension funds collapse or cannot pay agree benefits.

These types of problems occur when money due for benefits is not paid into pension funds or money is removed from company-run funds by the company. When this occurs companies use the money for other purposes: increasing liquidity, paying bills, giving executive bonuses, etc. However, this creates problems if the company ceases operating or if liabilities of underfunded pension obligations weigh too heavily on the balance sheet.

Existing laws allows employers to take money from company-run funds if they are overfunded, but do not require them to immediately fully fund them when they are underfunded. Overfunding and underfunding, however, are normal conditions caused by fluctuations in stock and bond markets in which pension funds are invested. Because overfunding and underfunding tend to even out over time, companies using the funds like a bank can create problems. Even when pension funds are not run by companies, delays in paying obligations create problems if the company closes or goes into receivership.

Newspapers across the U.S. have carried large stories about pension payment problems at other bankrupt companies, but coverage of the problems at their newspaper colleagues have drawn scant attention.

4/26/09

BANKRUPT NEWSPAPERS GIVE EXECUTIVE BONUSES

Failure isn’t what it used to be. Bankrupt newspaper companies are following the lead of AIG and Lehman Brothers and rewarding executives with large bonuses. The Tribune Co. is trying to pay out $13 million in bonuses, the Journal Registers Co. is trying to pay $2 million, and Philadelphia Newspapers has already given hundreds of thousands in bonuses to its corporate officers.

Company spokesmen say the bonuses make good business sense by rewarding good performance and keeping executives from leaving the companies. Both arguments are hollow. The first rationale rewards performance in running the companies into the ground and the retention rationale assumes other newspaper companies are hiring and would want to hire the tainted executives.

The issue of bonuses has emerged because newspapers filing for bankruptcy are not liquidating, but using Chapter 11 to create reorganization plans that will allow them to change the terms of the debt and union contracts. They have to seek approval from the bankruptcy court for their expenditures.

It is true that most of the papers in these bankrupt companies are making operating profits, but their corporate parents are losing money. The fact that profits exist are one of the reasons the companies have been petitioning the bankruptcy courts to allow them to pay bonuses. Not surprisingly, company debt holders—including states that are owned taxes—are not too happy with the idea and employees who have suffered layoffs and wage concessions are rightfully resentful.

The bonus debacle is yet another indication that the bankruptcies were created in the board rooms and corporate offices, not by the economic downturn. Poor corporate and management decisions are their root problem.

The newspaper business is clearly hurting because of the recession, but it is not a unique phenomenon. About once a decade for the past 50 years, recessions have played havoc with newspaper revenues, but the industry has survived them. Poor economic times, however, push companies whose managers have not paid sufficient attention to their balance sheets into financial crises and bankruptcy.

The last time we saw such wholesale problems was in 1991-1993 recession. Ingersoll fell into insolvency in 1991 and was broken up after its use of junk bonds for financing backfired. The New York Daily News went into bankruptcy that year as part of the collapse of the Robert Maxwell house of cards. United Press International went into bankruptcy in that recession as well. All three were victims to poor managerial choices made earlier and their positions became untenable in the recession.

History is repeating itself.

The bankruptcies today are the result of companies surpassing their financial capabilities and because executives have exceeded their own abilities to manage the firms. Some newspaper executives unwisely loaded their companies with enormous debt to make acquisitions and others are in trouble because the cumulative weight of poor management over a period of time has finally caught up with them.

Most newspapers, however, are surviving the downturn and will be serving their communities for many years. They are responding to the poor advertising climate with responsibility and thrift--NOT by giving executive bonuses that should be used for strengthening their businesses.