- Dean Baquet
Former editor, Los Angeles Times
- Charles Bobrinskoy
Vice chairman, Ariel Capital Management
- John Carroll
Former editor, Los Angeles Times
- Lauren Rich Fine
Managing director, Merrill Lynch
- David Hiller
Publisher, Los Angeles Times
- Jeff Jarvis
- Bill Keller
Editor, The New York Times
- Larry Kramer
Former head, CBS Digital Media
- James O'Shea
Editor, Los Angeles Times
In general talking with people about the future, they all talk about the Internet. Newspapers have to get some way of making Internet pay. Why [is it] the L.A. Times appears not to have had as big an investment in the Internet as The Washington Post or The New York Times?
I think The Washington Post first, followed by The New York Times, were really quick to embrace the Internet. I think that a lot of other newspapers, including the L.A. Times, were slow. ... I'll own up to that. ... Journalists were slow to embrace this thing. It felt odd. It felt like this thing had different deadlines. Who really reads it? We're all middle-aged. I mean, I'm young for an editor of a newspaper, but I'll be 50 soon. So we were slow to embrace it. Business sides of newspapers were slow to embrace it, too, because they ... didn't see how they were going to make money from it. So we were slow. I would own up to that. I suspect that Tribune Company would own up to it, too.
But my God, what a good thing it is now once you embrace it. First off, it feels just like the afternoon papers I started for. You get the story; you put it up. I like that. That appeals to the competitive part of me. I get e-mails now from people all over the world who read stories that they like, who read stories that I like sometimes, too. I have readers I never would have had. I have readers I never could have dreamed of having. When we do a big story, we have more impact than we ever could have had. I'm speaking as a journalist whose job it is to disseminate information. It's the best thing that's ever happened to us.
It takes away all of the boundaries, while we still get to maintain this thing we love, which is the paper on paper. I have no doubt, because of the way the capitalist system works, that the people who own newspapers will figure out a way to profit from it. Some newspapers have. The Wall Street Journal has, and some others have, too. I'm not that worried about that. I worry about this middle period, this interregnum where there's tremendous pressure on newspapers to cut costs to get ready for that future. I'm worried about protecting the institution during that middle period. But I'm excited about the Web, even though [we] and everybody else were slow to embrace it. …
Is the cost cutting affecting the ability to invest in the Web and Web operations?
There are two answers to that. First, the Tribune Company would make the case that it's invested a lot in the business side of Web sites in general. And they should make that case, that they've put money in the digital world, even if they haven't put a whole lot of money in the newsroom's operations in the digital world. I've put a lot of people on the Web because I think latimes.com is part of the L.A. Times. Have we gotten a lot of financial support to do that? No. It's true we haven't.
... They're not investing in the Web, which is the future of the newspaper. They're not giving you more money for editorial employees to make the Web attract more readers.
That's true, but I'm doing it myself. I appointed an associate managing editor to go over to the Web site to run the editorial portion of it. I've put writers over, and I have more reporters doing stuff.
To be frank, you can't separate the future of the Web from the future of the newspaper. People will read latimes.com because of the way we cover the governor's race or the way we cover the war in Lebanon, and it's my job to make sure the Web does that as well as the newspaper does, to make sure that they're still holding hands and working together. ...
In 2003, the Los Angeles Times became the subject of attack because of your exposé of Arnold Schwarzenegger on the eve of an election.
... That's one of the proudest moments for me as managing editor of the paper. It was a hell of a story. It was a great story. It upset some people, who canceled their subscriptions, but it was an important story, and the next day he pretty much confirmed it. So it had all the benefits of a great newspaper story: It was important, and it was true. I'm proud of that story.
Even on the eve of an election, where he didn't have a real chance to respond?
Well, he did. It was a truncated election. ... It wasn't a normal election. So we started chasing the story. We put people on the story just a few weeks before the election, and it was ready to go the night before it ran. And we had a choice. ... Even though there have been allegations we held it, we didn't. If you ever look at the different editions of the paper for that day, it was different for each edition because we were editing on deadline.
We had a choice. We reported this great story, an important story about the guy who's the leading candidate [for] governor. You can do one of two things. You can read the story, say, "This is too hot," put it in a drawer, or you can say, "Our job is to report stuff and let the readers decide." And we chose the latter.
... I started out as a newspaper reporter at 19. I've spent so much time subjugating my political beliefs. ... The main political institution that I believe in is the newspapers. I've never had a public discussion about my politics.
... If you ask me to make a list of the senior editors of the L.A. Times and whether they're Democrats or Republicans -- these are people I spend all day with -- I don't think I could tell you for most of them. I'd have to guess. ... I can tell you that some of them are conservative, sure. Absolutely.
Newspapers in big cities probably have more of a feel for big-city issues, and maybe the editors and the writers are less religious, because that's the way people are in big cities, having lived in big cities and smaller cities.
But the reality [is], the newspapers I've worked for are not liberal in their coverage. There's such a system in place to keep politics from seeping into the pages of papers.
Do we make mistakes? Sure we do. There are a lot of liberals who would say newspapers were too soft on the Bush administration during the buildup to war, and there are a lot of conservatives who now would say that we're too tough on the administration for the conduct of the war. I'm not sure how that translates into being biased one way or the other. I think extremes on both sides of the American political spectrum don't like a lot about newspapers, but that's natural if you're supposed to cover the world with some objectivity.
[Imagine] I'm a conservative sitting out here, and I'm saying: "Give me a break. Didn't you, Dean Baquet, and [New York Times executive editor Bill Keller] write an editorial together?"
It was an editorial not about a political issue; it was about a journalistic issue. It was in support of the one thing that we're openly biased about, which is the First Amendment and the importance of newspapers and publishing the things we find out.
To back up and explain it to people, The New York Times, the L.A. Times, The Washington Post, and The Wall Street Journal reported on a secret government surveillance program to monitor financial transactions around the world, to oversimplify it, and the government asked us not to publish it. Going back to the example of Arnold Schwarzenegger, my job is to publish stuff. ... My job is to cover the war on terrorism. My job is to cover the government in its prosecution of the war on terrorism. One of the biggest controversies in America right now is the government's prosecution of the war in Iraq and the war on terrorism, and my job is to cover that with tremendous aggression, and I do.
Even if it reveals secrets that the government says will help the enemy.
Yes, because it's not my job to believe everything the government tells me. If the government had offered compelling proof that a life would be threatened, or if the government offered compelling proof that an ongoing operation would have been threatened, I would have felt differently.
In fact, we've held stuff back when the government has offered compelling proof of that. But I put the emphasis on "compelling proof," because history shows that the government doesn't always tell the truth when it offers a reason not to publish.
So Dean Baquet has the right to decide when something damages national security and when it doesn't?
My role as the editor of a newspaper, and the newspaper's role in the society, is in fact to try to make that kind of judgment.
That may sound arrogant, but it's not. If you read the language of the [Supreme Court] justices in the Pentagon Papers case, they specifically said that newspapers have this role in the society. In fact, it's our patriotic role. ... It's our patriotic role to fulfill our place in the firmament of the government, and fulfilling my place is to aggressively cover the government, and that means not always believing them.
In the Pentagon Papers case, the Supreme Court held that there was no right of prior restraint. They didn't say you couldn't be prosecuted for espionage. If you're going to make [secrets] like that public, you put yourself in harm's way at that point, in terms of the law of the United States.
Well, newspapers sometimes have to take the risk that they're going to be prosecuted ... if, in the end, you feel that your role is to publish this stuff. And in that case, I don't think the government had a compelling case. Some readers may say that's arrogant of me to make that determination, but here's my job: The L.A. Times finds out all [this] stuff; it talks to people who like the program; it talks to people who criticize the program. It goes in, and we talk to the government, and the government makes its case, and then we sit down and prudently debate among ourselves whether in that mix of stuff is a story.
In this case, it was clear to me that in that mix of stuff -- and I must say, the editors of every major newspaper in America had the same reaction -- it was clear to me that there was a story there, no matter what the repercussions were.
The director of national intelligence, John Negroponte, it's my understanding, has called you.
Not just about this story, but other stories. And I know in one case, as I understand it, you didn't run the story.
Yeah. That was an interesting case. ... He made the case that we didn't have it right, but he wouldn't say what we didn't have right. And in that case, we did all the reporting we could, and we weren't 100 percent convinced we had the story. ... Essentially, we had allegations that the government had this surveillance operation set up. But we couldn't prove what kind of surveillance operation it was, what it was doing. …
Negroponte didn't even have to call. If we had written a story at that point, it would have said something like this: There are a bunch of stuff in a room, and it looks like surveillance stuff, and we don't really know what it is, but isn't this interesting? Well, that's not a story to me, and that was the judgment that we made not to publish it. ...
When George Tenet was the head of the CIA, we had a story in the works about how the CIA, because it had lost its spying apparatus in Iran, was essentially using the Iranian community in Los Angeles as its way of spying on Iran. ... Tenet called me at home. He made the case -- and it wasn't convincing -- he made the case that we would be revealing state secrets. But when I talked to the reporter and I read the story, if we were revealing state secrets, we were the last one to reveal it, because it was pretty clear that every goddamn person in the Iranian community in Los Angeles knew about it.
That informs the decision of today about the spying system. They will always say, "Don't report this because you're revealing state secrets." That's their role in the dance of democracy, and it's our role to try to best assess whether they're telling us the truth. In the case of [the SWIFT financial surveillance program] and in the case of the Iranian spying story, I determined and the paper determined that they weren't telling the truth, that they were exaggerating it. ...
[Do you] do a gut check when the director of national intelligence or the CIA director calls you?
Oh, sure. You talk it over with people in the Washington bureau; you talk to the reporter.
You don't ever say, "What are you getting me into?"
No. I want to be in that kind of situation, you know? There are only ... half a dozen news organizations in America that are in the position to find out that kind of stuff. I want to be one of them. And the price you pay is every once in a while you get a phone call like that, and you get a little nervous. Actually, I didn't get a little nervous. I thought it was great. I thought we obviously had a really good story. I had to make a judgment, but that was fine.
I would rather get that phone call and know I had a good story in the works than the alternative, which is to not be one of the institutions that gets that kind of story. I'm very competitive about that kind of story. ...
Editor's Note: The following is from an interview conducted on Nov. 15, 2006, after Baquet had left the L.A. Times.
Let me try to understand this. When you got [to the Times], how many employees were there? And how many are there now?
When we got there, there were close to 1,200 and by the time I left, there were roughly around 900. We lost about 20 percent of the staff, roughly over 200 people, which was difficult. …
Maybe you can describe what the attitude was or what the problem was when you got there and what you were able to accomplish.
Yeah. Well, first off, the paper had just gone through the Staples scandal, which arguably led to the sale of the paper. And the integrity of the whole institution had been called into question, even though, to be frank, I think the newsroom's role in that was minimal. I mean it was a highly principled newsroom whose reputation had been tarnished by Staples, which essentially was a case in which they produced their weekly Sunday Magazine and had agreed to share the profits with the Staples Center, which is a sporting arena in Los Angeles.
So we came in and it was a newsroom that was feeling a little down. Again, I don't think that newsroom did anything to earn the black mark on its reputation, but it was there. It was a newsroom that was down, but it was a hell of a newsroom.
I would not say that I walked in the door or [former Times Editor] John [Carroll] walked in the door and picked it up off the ground. I think it was like a Ferrari that just needed to be reminded that it was a Ferrari. And that's what we did. And I think that we won, in the course of the six years John and I were together, as many, if not more, Pulitzer Prizes than any paper in the country. Not that Pulitzer Prizes are a be-all and end-all, but for a paper that had a tarnished reputation because of Staples, they were important.
And I think they told the world that this paper is coming back. And they told the paper and the staff that we can run with anybody; we can compete with anybody. And I think that that attitude still exists in the newsroom. I think this is a paper that more than most papers in America feels like it can run and compete with anybody -- and it can. …
… You were being asked to do layoffs. Did you and John sit down and say, "We just won five Pulitzer Prizes. What's this about?"
We did. We did do that. It was painful. But we did the layoffs. And we did the layoffs and we managed the paper through the layoffs for a couple reasons. First off, as I said in the beginning, the revenue had dropped. The decision was made quickly. It was clear that some cuts had to be made. I'm not sure that those were the right cuts, but at a certain point, if you're going to lead your newsroom and the publisher made a convincing case that we had to do layoffs, you do them.
I believed that the newsroom could come out of that first round of layoffs and still be fine. I thought it'd be hard and I thought we'd have to manage the place through it and we did it. And we came out the other side and we were fine. It's the other side and we were fine. But then it got to be an annual event. And not only an annual event; it got to be not just layoffs, but the cuts started to be sort of part of the life of the paper.
It started to be -- and I think this is true in a lot of papers -- it wasn't just layoffs, it was every few months -- I mean, you'd start the year with a budget and every few months you'd re-budget and you'd cut more news [hole], more space for news. …
[You opposed further cuts, and Jeff Johnson supported you.]
Yes, I think Jeff, who was the publisher, got it. I think he believed me. I was willing to make cuts, I was willing to even give up some bodies by attrition. I was willing to make some more cuts from news hole, but I thought to take out another huge group of people -- first, it would demoralize the newsroom. Secondly, any plans we had to do anything different or new or special would just evaporate. And, third, I think people forget what it's like to lead an institution through layoffs or cuts. And I'd done it two or three years in a row. It's demoralizing. The whole place focuses on cutting. And I think, to be frank, American newspapers are now too focused on cutting.
So I just told them that I couldn't do it. … And Jeff agreed with me publicly.
They say Jeff took the Kool-Aid.
… Yeah, here's what I think happened with Jeff. And he can speak for himself, but here's what I think happened with Jeff. First off, he grew as a publisher. And not a lot of people are doing this, this growth. And it's what all publishers used to do. He goes from being on the business side, an operations guy, he takes on the publisher's chair, and, you know, suddenly your concerns are supposed to widen. You're supposed to care about the newsroom, you're supposed to care about the mission of the paper.
He got that. And he just grew. That's one thing. Secondly, while I think he agreed with me about what a big layoff would do to the newsroom, though we were both willing to do cuts, I also think that he thought it would be bad for business. I thought that he had the ad guys coming in saying, you know, we could do all of this other great stuff, we could great new sections, we could do this -- we could do this online. We could create new possibilities online. And he saw that that would be really hard to do if we kept cutting the newsroom. …
Let me play devil's advocate. You said you'd have to close national and foreign bureaus. They say you should.
… There are only three American newspapers that are on the ground in Iraq all the time. The L.A. Times, The New York Times, and The Washington Post. USA Today goes in and out. They have one person. He's there on the ground sometimes and then he gets out. The wires are obviously there all the time. But nobody else has a fulltime staff who's always there. That's appalling. The thought that we would reduce that to two, maybe even one day one. That can't be. I mean, that can't be good for the country. …
[After Jeff Johnson was fired, his replacement, [David] Hiller, said he wanted you to stay.
Yeah. In his [defense] -- he didn't say, "I want you to stay and be editor of the L.A. Times." What he said was, "I'd like you to stay, and let's see if we can work it out. Let's get to know each other."
Don't expect me to drink the Kool-Aid.
He didn't say that. [Laughs] He didn't say that.
But then after that, you went to a meeting of editors in New Orleans.
Tell us about the meeting and what you said.
Sure, sure. Long before all this happened, I had been invited to be the keynote speaker at the … Associated Press Managing Editors Conference in New Orleans. …
I said that I thought that some of my colleagues as editors had let me know privately how angry they were about the cuts they'd had to make. And I said that maybe they shouldn't be so quiet about it. Maybe they should push back a little harder. … I talked about the Tribune disagreement very briefly, just to walk people up to what had happened. Mainly, I tried to talk to these managing editors about how they had to take control of their own fates; how it was time to not just let the business side of newspapers move us forward; how every time newspapers had run into a crisis in the past -- whether it was the advent of radio or television -- the genius that had saved us had come from the newsrooms, the inspiration to create feature sections, to make newspapers more compelling, and that it was time for them to do the same thing. …
[Prospective Times buyer] Eli Broad, and many other people --
A good guy. Very handsome guy. [Laughs]
Well, Mr. Broad said … he'll be satisfied with 6 to 9 percent profit. He just wants a better paper with more local coverage because it should be an L.A. paper.
[He] sounded pretty good so far. What do the other guys say? [Laughs] … I think that sounds great. I never had a conversation with Eli Broad about the paper or what he would do with the paper, but, you know, that sounds like a great owner. …
Tell me about [your departure from the Times.] …
We planned on announcing it the Thursday, … except Tuesday morning, The Wall Street Journal moved a bulletin that said that I had been forced out. And I immediately sent a note to the staff saying that it's true, you've probably seen this by now, let's all talk at 3 o'clock. So at 3 o'clock that afternoon, David came into the newsroom, the staff crowded around, hundreds of people, and I stood up on a desk and confirmed it. … I was choked up. It was very emotional. It's a great staff. …
People were walking around with a lapel pin with your picture on it?
Yeah. I was selling those for $5 -- no, I'm teasing. They were. … There were pictures of me all over the newsroom. It was touching. What I kept thinking was think of what I've been through, with this newsroom. I have personally laid people off in this newsroom.
Because that's the thing that people forget when they think about my tenure. I've done hard stuff in this newsroom. And I've had to say no in this newsroom, and I can't tell you what it's like to go out as an editor and still have your newsroom support you, when you've had to do hard stuff. That meant a lot to me. A whole lot.
The L.A. Times is not very well known for its intense coverage of City Hall, local communities and so forth.
And that's the problem. The L.A. Times has had bigger circulation declines than any other major newspaper. It does a very poor job of focusing on Southern California. Instead, again, it's got these 22 foreign bureaus. It's trying to be The New York Times, which everyone -- the writers and editors of the L.A. Times want to have their opinions read by their peers across the country, by politicians in New York and Washington, by the people who give away Pulitzer Prizes.
That's not what readers want. Readers care about the local entertainment industry, which they don't do a very good job of covering in the L.A. Times. They care about things like fashion, which The New York Times does a very good job of covering; the L.A. Times doesn't. They should care about issues like immigration. All of the Mexican-American immigration issues should be front and center in the L.A. Times. They should own that story, and they don't in the way they should.
We own a lot of newspaper stocks in a lot of newspaper companies, and the best get it: Focus on what you do best, and that's provide coverage of local news.
But if you don't invest in the product itself -- in this case, a newspaper and its ability to gather news and have experienced people do it -- eventually no one will buy it.
What we would argue is that The Washington Post does a better job of covering its local market with fewer reporters than the L.A. Times does, maybe 15 to 20 percent fewer. How does it do that? It does it through focus. If you focus on your target market -- again, Washington D.C., politics; in the case of The Washington Post, the Washington Redskins, who they do a great job of covering at The Washington Post -- then you can get by with less reporters than the L.A. Times has, because it's trying to cover the world. It's trying to report on why Bush went to war in Iraq instead of what's going on in Southern California.
What they say is, with the cutbacks, there's been no real investment in the Web site of the L.A. Times or in a plan to change the nature of the coverage and go more local; that really all it is is, we're paying for their mistake, combined with these unusual market conditions, the rise of the Internet, the end of classified ads, etc.
As we all know, anybody who covers the Internet industry at all knows, it doesn't take a lot of actual investment to get a Web page right. It takes focus on what you're covering and what's on that Web page. Getting a good Web page is not something that requires a $500 million investment. It requires focus on what's there, what stories are there, what are you covering. How do you deal with advertisers on those pages? The L.A. Times doesn't do a good job on any of those fronts, whereas The Washington Post, The Wall Street Journal, The New York Times all do an excellent job.
[How did you approach your new job when you became editor of the Los Angeles Times?]
Well, the paper had been through a rough time when I became editor. There had been two big things that happened. One was the Staples scandal, which was an ethical crisis involving a secret partnership between the paper and some developers, ... mixing advertising and reporting. The staff was really in a state of shock about that. There was a lot of unrest.
Then secondly there was -- partly because of that -- the paper changed hands. It was purchased by the Tribune Company based in Chicago. It had always been controlled by Los Angeles interests before that. And that was a good change.
... They bought Times Mirror newspapers, which included the Los Angeles Times, Baltimore Sun and Newsday and some others. I was editor of the Baltimore Sun and they said, "Will you go out and be editor of the LA Times?" I said, "Maybe, what do you want to do with it?" They felt they bought one of the crown jewels of American journalism and that they wanted to keep it that way and build it. ... You never know what direction the business will take in the long run, but there was an understanding that we were there to put out a first-rate, a top-tier newspaper. I think we did that. It got harder and harder as we proceeded.
How did it get harder?
Because of cost cutting. ... They cost-cut every year. And for a while it was fine because there really was considerable fat in the operation. But after a while ... it began to damage the paper. It began to damage the business side of the paper and its ability to keep the circulation up. It damaged the news side of the paper. It reduced the amount we were able to give the reader. ... It was happening at an accelerating pace. And it was happening at a time when the paper was making lots and lots of money. ...
I got to the point where I had felt that I should leave the paper. ... Every year we were getting rid of reporters and cutting space in the paper, and it was accelerating. I didn't understand that strategy. I understood the short-term need to boost the profits -- you know, got to do that -- but there was a strategy in it; that is to say, something worth a long-term vision. I was unable to understand that. I felt it was leading to bad places for the paper, and I felt that I didn't want to be part of that. ...
I was pushing people out the door, reducing staff and reducing pages in the paper, which no editor likes to do. ... That was something that can't go on forever and it was really crucial to why I decided to leave the paper. ...
But I was really torn. I loved the paper. It's got a great staff, and I took a long time pulling the plug on my job there, because I really didn't want to go.
Tell me about this L.A. Times deal. ...
… The Tribune Company owned several newspapers in major cities, and they owned a lot of TV stations. When they bought Times Mirror, they only bought newspapers and some other non-strategic assets. They didn't buy any TV stations there; they already had them. ... The feeling among their shareholders was they felt they hadn't been forewarned that Tribune was interested in owning more newspapers, so they were very surprised. The price the Tribune paid at the time was actually very rational, so from a financial point of view it wasn't as much of an issue. But it was more of a strategic issue that nobody understood why, as a broadcaster, they wanted to own more newspapers.
The strategy was to try to couple TV stations and newspapers in major markets, and if you couldn't do that, try to put together an unwired network among all the major markets across the country ... so that you could go and get more national advertising. ... And also at the time, the Times Mirror Company had lower margins than Tribune, and I think there was a presumption that they could come in and really use their financial acumen to improve the margins of Times Mirror. There was both a strategic-revenue opportunity that they thought they had and a cost-saving opportunity, and that the two would provide good returns on the investment they had made.
So it looked to make some sense?
At the time it made sense, except that if you were a Tribune shareholder you were still shocked. ... A lot of things have gone badly in that deal. Some of them were beyond their control and had everything to do with industry issues. Some of them were just tactical errors.
I do not believe that they really ever went in and applied best practices across these papers and really took advantage of some of their combined strength. So if you've got really good overseas news bureaus, do you need separate ones across all these different metropolitan regions, or can you find a way to really combine them? Common systems that affect the back office in terms of circulations management and ad sales managements, things that they're doing now would have been brilliant to have done five or six years ago.
They took a gamble on a pending tax issue. They ended up losing, and that cost them a billion dollars. That could have happened to anyone. ... The Newsday circulation fraud issue, they could never have known about. ... That was something that you can't hold them accountable for at all. But some of it, I think, was a reluctance on their part to give up on the strategy of going after the national ad dollar when it worked in a minor fashion and refusing to see the impact the Internet was having on, for example, the entertainment and movie category. ...
So there's a lot of little things, a lot of big things. Overall it's been a touchy issue, I think, from a morale point of view. ... There is a feeling that there's a bit of slash and burn going on. And the company is trying to prove that it's strategic, and they're trying to position themselves for the future. I don't know that either side is listening well enough to the other side to know what's really going on, but I would say there's a tremendous number of morale issues across their properties.
The Chandler family -- at least some prominent members of the Chandler family -- seem to have some seller's regret here.
From an outsider's point of view, it's really hard to discern what's going on. I don't think it's as much seller's remorse as it is trying to preserve a deal where they didn't pay taxes. Some of their outcry right now is trying to preserve their capital and isn't necessarily helpful to other shareholders, so I'm a little bit cynical about their current crusade. ...
Now, on the staff of the L.A. Times, on the other hand, you can't help but get this feeling they don't like being owned by a company out of town.
You know something? No newspaper in this country likes being part of a larger newspaper or corporation, ever. There's a feeling that the decisions being made don't apply to their unique specific situation, and no one in this business today is enjoying what's happening economically. ... It's no different than if I'm asked to remove somebody from my team, and sitting here going, "Just tell me how much money you need to save; I'll find a way to do it." But there's a corporation with a structure in place that doesn't permit for that deal to be cut on the side. I think that's all you're hearing.
We went into the Los Angeles Times printing press, ... and then, just even with the robots that they now have, you're still talking about 400 or 500 people coming in on Saturday to put out the Sunday edition. ... It seems like this archaic process.
Actually, the technology has advanced considerably through the years, and in the past some of the labor unions refused to allow them to take advantage of some of the efficiencies. The industry is less unionized today than it used to be, and it's a thousand times more efficient. I actually think it's been modernized, and I'm surprised by your description of the numbers of people. I'm more surprised [by] the other direction, where I go in and go, "Oh, my God! There's like, 10 people here putting out an entire paper," because it's all been automated. Why aren't some of these companies doing better if they've reduced some of these costs so dramatically? The real cost is distribution: Somebody actually has to physically bring the newspaper to your door, and, much like the U.S. Postal Service, that becomes really challenging over time in terms of the cost.
Is the money you're saving by doing layoffs or buyouts going to go into the Web site?
Well, I haven't done any buyouts or layoffs, but we are -- I think we're going to be moving people; I think we'll be moving dollars. Also, what we need to do -- and this gets a little lost sometimes -- is we need to retool basically everything we do in the newspaper so that it works for the Web as well as for print. ...
One of the biggest things we're going to be doing is basically transforming our print newsroom so that it's across every desk, producing news, information and content that can be used across print, online, wireless, video, you name it. We were behind on that. That's another area where I think over the last several years we could have been doing more. That's a more interesting and fruitful focus than this issue of, if you pardon my going back to this, this [canard] of cuts versus no cuts. …
But Mr. Carroll has said it's not just an issue of cuts; that he wasn't given the resources he needed.
I think John's selling himself way too short. He had command of all the troops in the newsroom. If there was stuff that could have been done, I'd ask John why it wasn't done. Why wasn't it done? And don't tell me it was because he didn't have the money. He had the biggest newsroom in the -- short of The New York Times. Whatever he did or didn't do with it was something that was entirely within John's hands. …
You're saying that Jeff Johnson and John Carroll, and later [former L.A. Times Editor] Dean Baquet, had the ability to take resources and rebuild the Web site, do many of the things that you want to do, but they chose not to?
I don't know. I wasn't here. You'd have to ask them. All I know is they had an enormous amount of resources in the Los Angeles Times. I've got an enormous amount of resources in the Los Angeles Times with my colleagues here. That's what we're going to be doing. We're reallocating; we're rebuilding; we're growing the Web site. It can be done, but you've got to be focused on doing those things that make the changes to take you forward. …
When you say Dean Baquet was unwilling to do the kinds of things that need to be done, and he says that he was unwilling to preside over the destruction of what has been a great newspaper --
Yes, well, history will judge how we do. I'm convinced that we're going to take the newspaper forward and the Web sites forward, and at the end of the day people are going to say, "These great people of the Los Angeles Times did a superb job navigating the newspaper business into the future." That's what we want them to say at the end of the day. …
What will it look like when you finish your redeployment of resources and cuts?
The vision at the bottom is, people are going to say, well beyond our 125th birthday this year, that the Los Angeles Times and its Web sites and its related products are the best, most important source of news and information I get in and around and about Southern California; that they're going to say, the greatest days are still here and ahead of us; that it does a wonderful job of bringing together this sprawling, diverse set of communities that is Los Angeles …
I think print is probably going to be a smaller part of it. I know the Web is going to be a much bigger part of it. There may well be other products in the marketplace, including products that do a better job than we're currently doing addressing the Latino community. I think [Hoy, Tribune's Spanish-language daily paper], is going to be a major presence for the Spanish-speaking Latino audience in the community. There may be additional print products like we've done with The Envelope that addresses the entertainment news; Calendar, which is what to do, where to go, plan-your-life thing. ...
I'd like to hear about your Web plans. ...
We've learned a lot. We're 10 years into the Web, so we see a lot of what works and what people like to do, and we've got a great opportunity to blend the best of what newspapers do with the best of what the Web does. So in all sorts of areas of our coverage, whether foreign, national, local, we have the opportunity basically to host on the Web a sort of edited conversation, if you will, where we take what we do best in terms of content and use that as the basis for communities of interest focused on all these different areas.
Think of it as a marriage of the best of the Los Angeles Times with the best of MySpace; that you'll get community and interaction and chat and conversation, but it's sustained and directed and built up, if you will, off really great, edited content and reporting from the Los Angeles Times.
So you'll see that, for example, people are very interested in all the great critics and commentary we have in the area of entertainment and what's going on and movies and the entertainment business, as well as locally where to go, what to do, those sorts of things. That can then be the basis of both content that's interesting and draws people in on the Web as well as the foundation for a great, spirited community conversation online among all of the users. So you get a combination of great L.A. Times content and user-generated content, and it becomes the gathering place in cyberspace for people who want to know and do anything related to Southern California. ...
Does it mean the Times won't be competing with The Wall Street Journal, etc., on every major story?
Oh, I think on the major stories, particularly the ones of most salience here -- for example, this is the entertainment capital of the world, so we need to own entertainment, and we'll do entertainment better than anybody. We do it now, and we'll continue to.
We're going to continue to have a major foreign reporting coverage. We're one of the best at it currently. But one of the things we may emphasize, for example, is the unique role that Los Angeles has as the gateway to the Pacific Rim. That's a part of the story that's different here for the West Coast and for Los Angeles than, say, it might be for an East Coast paper.
But you know the concern: The Times has bureaus all over the world. It's one of the few papers that gathers information that way.
Yeah. My plan and expectation is that being a world-class provider of foreign and national news is going to continue to be one of the hallmarks of the L.A. Times.
But with fewer people?
Well, I don't know whether it's going to be with fewer people or not. There you go again, to say being focused on the numbers of people and not on the quality of the coverage.
But who does coverage? I mean, people do coverage.
Well, people do coverage. Yeah, people do coverage.
So that's why the focus is on how many reporters do you have working a particular story. ...
Yeah. Well, you said it well. My priority wouldn't be to have as many people as I can. My priority would be to do the best possible job for our readers and online users in foreign and national, and we're going to continue to do that. …
You don't see cutting back on the international bureaus in the coming years?
Well, we're not giving up any commitment to our foreign and national news, which is very, very important to our coverage. I don't have a specific view on levels or locations of bureaus or levels of personnel after the six weeks or so that I've been here. ...
There has been emphasis on turning this into a more local-coverage paper, less focus on international.
It may be too early to say. One thing I do know is that connecting with the audience in Southern California, which we do well in a lot of ways, but in being first and foremost indispensable for the people of our community, is job number one. Part of that I continue to believe is doing great foreign and intentional reporting, particularly in a market where so many of our communities -- our ethnic communities, first-, second-generation immigrants -- so to some extent, the whole distinction between foreign and local, world and local breaks down in a community as diverse and cosmopolitan as Los Angeles. ...
[Billionaire philanthropist Eli Broad] has gone on to make a bid with others for the whole Tribune Company. That's pretty unusual, for editors to be talking to people in the community about buying the paper?
It's highly unusual and I think out of line.
Why do you think it happened?
You'd have to ask John.
Do you think Eli Broad is going to be one of the owners of the L.A. Times?
I don't know. I do know what I read in the newspapers. Because of the terrific Los Angeles Times and some of the other great newspapers and TV stations within Tribune Company, there is a lot of interest in this business. This, in my humble opinion, is the finest set of media assets under any roof anywhere in the country.
The bids have been low.
Well, I don't know what's low. They've been at or above current market, and the current market already has gone up in anticipation that there would be some transaction. So from my standpoint, the market is validating significant value in these assets.
Are you going to be here next year?
I hope so.
You think so?
I think so.
You don't think Tribune will sell the Times?
It's hard to handicap the odds of any particular transaction. My own view is, there's a lot of benefit in having the great Los Angeles Times, the Chicago Tribune and some of our other papers together, so my hope is that transaction keeps the benefit of holding those together. ...
The Tribune was known as a local paper. Mr. Broad and others want to return to local ownership.
I'm personally open and agnostic. If you look at the history of the business, there have been great individual owners, local owners; there have been some terrible ones. There have been good corporate newspaper group owners, and there have been bad ones. It's all about how you do and what you're committed to and what your mission is. We'll just have to see.
What I do believe is that the Los Angeles Times can continue to be a great newspaper under any ownership arrangement.
Eli Broad tells us he's willing to accept 5 to 8 percent profit. Why isn't the Tribune Company?
As a public company, one answer would be the stock price would go way below where it's currently going, which is way below where it used to be. What I think you're seeing is, at least in the current state of things, the public stock markets aren't very hospitable places for media companies generally, including newspapers. So a private owner like Mr. Broad would be able to say, "I'll earn X percent." If he's the owner, he gets to say that. If Wall Street is the owner, they get to say what their expectations are for what a publicly owned business is expected to achieve. As brutal as it may seem, that's kind of a fact of life of the business world. It's not unique to newspapers or media companies; it's true of all businesses in the United States.
If you're organized as a business with owners who are expecting a profit, that's what you get, and you've got to try to deliver or find some owner who's got different expectations. At the end of the day, we'll see who was the owner and what their expectations are.
When Mr. Broad says Wall Street is the enemy, he's right?
Well, I don't think so. It's certainly the case that Wall Street and for-profit owners of papers have expectations about how the business will be run that may be different from how Dean would run them; it may be different from how Mr. Broad would run them, and to that extent they may disagree, and that's fine. But ultimately the owners get to decide. My hope is that we end up with an owner who is going to likely be a business interest so this is not a not-for-profit. This is not charity work, so we're going to have to figure a way into the future to run the newspaper as a business. But we also have an owner who has the same commitment to the quality journalism and civic mission that we've had at the Los Angeles Times for 125 years. If we get that kind of owner, we're going to be fine.
But there are nonprofit ownership situations.
All we need then is a not-for-profit who wants to spend $14 billion to buy the Tribune Company, and then you'd be all set. So if you know one of those, have them call me.
How much for the L.A. Times?
I can't answer that. I don't know. It would be a lot.
Of the $14 billion?
Want to guess?
Three to four [billion].
Three to four billion dollars, for Mr. Broad, etc.?
I don't know. I'm only guessing. …
Have Google, Yahoo! transformed the news industry?
Well, they have to some extent. I think one of the --
Should they buy the L.A. Times?
They could stand in line. There's a lot of interest. I do think of the places where newspapers as an industry haven't played our cards right is letting all our content get out for free on the Internet and get reaggregated by Google and Yahoo! and present their own Google News and Yahoo! News, the core of which is all the news that we've produced. I bet they can't believe their good fortune that newspapers have let that happen.
One of the things where we can continue to make some progress is to retake that role as an aggregator of news, and that newspapers working together and doing those things and creating sites and aggregations of the news that we and only we produce is a way to take back some of that value from Google and Yahoo!.
But Tribune companies belong to the [Associated Press], and you sell to Yahoo!.
Yeah, I think that's a mistake.
Google says what they do is fair use and they drive people to your site.
Well, some of that is. You do get into some distinctions that may sound legal. I think some of what they do is both fair use, where they use headlines and maybe a couple of lines -- and [like] Google does -- drive people to the newspaper Web sites. I think that's good and healthy and beneficial to newspapers. Where I think you go off the track is some of what the AP is doing, which is basically selling whole stories, summaries, basically giving the whole kit and caboodle to Yahoo! and letting Yahoo! build the audience and get the advertising revenue from it. I think that's a mistake.
I understand that some members of the board are starting to object.
Sure. Yes, and should, and I think it ought to be changed.
Mr. Broad said he would force them to pay for their content.
Well, then Mr. Broad and I see eye to eye on something.
Except he says he'd rehire Dean Baquet. ...
Well, the question would be, is he going to rehire Jeff Johnson, I guess, isn't it?
Journalism has to get far more innovative and inventive. ... I'm beginning to see it happen. Gannett -- not the company that I would have expected to be widely innovative -- has just blown up its newsrooms and changed its structure and become agnostic to media and seven-by-24 in their coverage. They care about new ways to get news including data, and they care about having the people in the community help report. Whether they can pull this off or not I don't know, but that's the right spirit. And I'm seeing that from Gannett, not from the L.A. Times. ...
The L.A. Times is not doing it?
Not that I've seen. The rhetoric that I hear about the L.A. Times is about protecting the newsroom and protecting the size of that. There's a tremendous amount of waste in American journalism. We send 15,000 journalists to the political conventions where nothing happens. Whatever does happen, you can watch it online and on C-SPAN. Why? Ego: We had our person there to do the same thing that the next person did.
Why does every town in America need a movie critic? I started the magazine of criticism, Entertainment Weekly. I love criticism. But the truth is, they don't; the movie's the same across the country. Why do they need an NFL writer and a golf writer? Why do we need editors re-editing AP [Associated Press] stories that have already been edited and re-edited? Why do we give people stock tables when they're going to get them online and it costs a fortune to print? We do it because we fear we're going to lose one more reader. ...
What the L.A. Times' now-former editors [Dean Baquet and John Carroll] say is: "We are one of the last four national newsgathering [organizations] in the United States who also are international. We think it's of public service that we have four people in Baghdad. It costs a lot of money, but it's in the public interest to have as many people covering Iraq as possible." ...
Who says that's the cut to make? Why isn't the cut to make let's get rid of the stock tables? Michael Kinsley arrived at the L.A. Times as opinion editor; he had 16 people writing 21 editorials a week. Take five of them and put them in Baghdad. Fine. See? ... The world has changed. Why shouldn't journalism? ...
But what they're saying is ... we have to avoid the problem that network news is now in where ... you now have one person at CBS who covers the Supreme Court, the Justice Department and the FBI all at once, every day. ...
Well, that's a management issue. ... No one is telling you have to get rid of your Supreme Court correspondent. They're telling you this is a business and we've got to deal with new business realities. ... My friend Jim Willse at The Star-Ledger in Newark, N.J., killed the stock tables in April of 2001. He invested money in making a much better business section, but he saved a $1 million a year on paper and ink for those stock tables. ...
Today we operate out of the fear that [readers will] leave us if we get rid of a cartoon or a stock table. We operate out of the ego to think they'll come to us because we have a columnist logo. They're going to come to us if we contribute value to the community, and that value is going to come from reporting. So let's find the ways to put more resources directly into reporting.
The Los Angeles Times put the resources in to look at the local community hospital -- nobody else on the Internet or anywhere else was doing anything like that -- an in-depth look that has resulted in significant change, may have saved lives. The Los Angeles Times put the resources in to track down the stolen art that was at the Getty Museum in Los Angeles. ... The fear is the resources won't be there ... to do that kind of reporting, especially as you go and transition to the Internet.
There's a new medium and a new way to do things, and so among the ways to get journalism over to that new world and that new growth are to find new efficiencies. ... What's the relationship of the newspaper to that journalist? ... It could be that they could hire them, but they're not hiring anymore. It could be, perhaps, that the business side creates an advertising network across a web of good, trusted, reliable people doing journalism. ...
There are new ways to maybe get public-supported journalism. NPR and PBS get money from the public and do great journalism. Jay Rosen at NYU has started something called newassignment.net, which is an effort to see whether people will support journalism with their ideas and their money and their reporting. That's not the solution to all journalism; the point is we have to find many models, many new ways to do things. ...
Someone is going to go investigate the hospitals; someone's going to figure that out. I hope it's still the journalistic organization, the newspaper, but if it's not, other journalists may band together to figure out a way to do it. ...
To do an in-depth story or investigation of a powerful institution usually requires resources, and you're in jeopardy doing this story, because they can come back to you either with subpoenas or lawsuits or possibly worse. ... Don't you see some danger in the future, as this changing economic model goes on with the Internet, that ... that kind of reporting won't happen?
I'm concerned about the lack of support to journalism by whomever is committing those acts of journalism. ... The Media Law Research Center is tracking I think more than 50 suits against bloggers right now, some of them pure harassment. We have to defend them, because if we don't defend them, then the rights of all journalists are affected. Yes, I'm concerned about it at every level and every rank. ...
... As a competitor of yours, what can you say about the Los Angeles Times situation?
Well, I've got to qualify everything I say by saying I've never worked at the L.A. Times, ... so this is the view from afar. I do appreciate, as somebody who grew up in California, that the L.A. Times has a kind of strategic problem that's different from a lot of other places: L.A. is so sprawling and spread out, and most of the people who live in their circulation area don't think of themselves as living in L.A. There's even a kind of antipathy towards the name in the region, let alone in Northern California. So that creates all kinds of difficulties.
But the idea that the L.A. Times is going to say to readers, "Buy the L.A. Times, we will tell you what's going on with the traffic and the schools and the cops and the local stuff, and if you want to know what's going on in Iraq, go buy The New York Times," that doesn't sound like a terribly sound business approach either. And if I were a Los Angelino, I would be a little insulted by that. Why are the two mutually exclusive? ...
What the current publisher, Mr. [David] Hiller, said to us was that The New York Times' model is not a model for the L.A. Times. The New York Times has, as he put it, given up its local circulation, which has gone way down, for a national circulation, and the L.A. Times would die if that happens.
I don't think we've given up our local circulation, but we've rebalanced our circulation so that it's more than half of it is national, that's true. I don't know what the model is for L.A., and I'm not going to presume to say that The New York Times is the model for the Los Angeles Times; I'm not sure that the Chicago Tribune is the model for the Los Angeles Times, either.
But it just seems common sense to me that you can satisfy people's need to know what's going on in their own community and tell them what's going on in Washington and in Baghdad. It wasn't all that long ago that a lot of newspapers did that: They performed strong local journalism, but they sent a correspondent to the war in Vietnam, they had a guy in Jerusalem or a guy in London. ... It's not a terribly novel idea, that you can try to serve both. ...
What do you think of Dean Baquet and the fact that this whole controversy [about Baquet refusing to make staff cuts ordered by L.A. Times' parent the Tribune Company] broke out into public view and in the pages of the L.A. Times itself?
I should say that Dean's a friend; he's somebody I've worked with in the past, and somebody I admire immensely as a journalist. Again, I don't know whether the right size of the Los Angeles Times newsroom is 1,200 journalists or 900 journalists or 800 journalists or what it is, but I know in my gut that he picked the right fight, and the fight is over having journalists. If you're going to do good journalism, you have to have good journalists, whether you're going to do it on the Web or in print. ...
But now you're getting applications from the L.A. Times?
That's true, and that's partly, of course, because they lost Dean. And he is an inspirational leader, somebody that people love to work for. I know of specific people that we've tried to hire who would've loved to come to The New York Times but wanted to stay and work for Dean.
But it's partly because of the message that they have heard emanating from the Tribune Company, which is, we're thinking of a kind of different, smaller, cheaper, more profitable newspaper. Certainly the people who's biggest interest is writing national or international news have taken that as a kind of vote of no confidence. ...
Even after everything got public in the pages of the Los Angeles Times, [Baquet] gave a speech in New Orleans, where he urged editors to stand up to their publishers and to start pushing back on the issue of cuts in the newsroom.
I asked Dean to e-mail me a copy of it and I read it, and I think people have made too much of that. ... The speech was actually even-tempered. It was not, "I'm mad as hell and I'm not gonna take it anymore." He wasn't urging people to rise up and revolt. ...
No. But he was saying that there's an unspoken anxiety amongst editors around the country, that they're being squeezed.
Well, of course there is. How could there not be? You look at what's happened in Philadelphia, what's happening in Baltimore, what's happening in -- well, now Los Angeles; a lot of places with storied newspapers with histories of really aggressive, impressive, prize-winning journalism, being hollowed out.
I'll tell you a couple of statistics that I've ran across lately, one of which I keep repeating at every opportunity. After the fall of Saddam Hussein, there were more than 1,000 foreign journalists in Iraq; today, there are fewer than 75. Now, I appreciate a lot that is because it's an incredibly dangerous place to work, but a lot of that is because newspapers are in retreat from covering complicated, foreign stories.
Throughout the coverage of the midterm elections, I was hearing from our reporters that the [campaign] buses were kind of empty, that on some of the major campaigns, even big papers in the states where the races were going on were not assigning the kind of reporting coverage that they would have in the past, that some of the major papers were telling their political reporters, "You have to clear it with us if you want to take an airplane somewhere." That isn't economy; that's suicide.
When I have an opportunity to talk to editors and publishers, I tell them this, that I think the gravest danger facing our business is not new technology or changing demographics or hostile administration in Washington or the blogosphere. The gravest danger facing our business is surrender, despair, panic. There's a lot of it going around. ...
Let me tell you what the Tribune Company's representatives said to me about this: They said this whole argument has become a soap opera in which it has been oversimplified into cuts or no cuts. What this is really about is, how do we survive in the future? The business model that existed at one time no longer exists. ...
Well, first of all, Dean had done [a] considerable amount of cutting. He reduced the size of the L.A. Times newsroom from around 1,200 to 900 and some. That's not exactly refusing to go along. And implicit in the notion that you're going to reinvent the news-gathering business model is that you're going to do news gathering. Who's going [to] gather that news? There's nothing more ridiculous than this notion that has taken hold that you can do good journalism without good journalists. It's silly. ...
Both Dean Baquet and the now-former publisher Jeff Johnson said to us that their first responsibility is to the readers, not to the shareholders. Are they being naive?
I think that's the way journalists have to think. Clearly the institution of a newspaper has responsibilities to both, ... but if you're an editor, you should wake up in the morning thinking about the reader. ...
Dean also said that Wall Street is his enemy. ... I guess what Dean was referring to is that [despite] the L.A. Times' billion dollars in revenue, over 200 million in profit, they don't like the idea that it looks like it's in decline. Same thing with The New York Times?
There is one way in which Wall Street, the concept, is inimical to journalism, and that is that Wall Street tends to be conducive to shorter-term thinking. ... That creates a lot of pressure on publishers and executives of newspaper companies to also think short-term, which is one reason I'm really happy to work for a company that has a little bit of insulation from the whims of Wall Street, by virtue of being controlled by a family. ...
We have two classes of stock. The functional control of the company rests in stock that belongs to the Sulzberger family, and they make the major decisions regarding what the budgets will be, what the investment will be, and so on. Obviously, they're not indifferent to the economics of the company, they think about that a lot. But they have the luxury of thinking over the longer term, and one result of that has been that in the past when there have been economic downturns The New York Times has often chosen those moments to invest rather than cut, knowing that when the cycle turned back and the marketplace recovered, we'd be in a stronger position. ...
But Wall Street has, and I'm thinking specifically of Morgan Stanley, has gone public, criticizing investment strategy of The New York Times, the way in which the company is run.
First of all, it's not Wall Street, and second of all, it's not Morgan Stanley. It's one investment fund within Morgan Stanley and one fund manager who has made this crusade. ... The one thing I can say from the newsroom point of view is I wake up every day grateful for the Sulzberger family. And the same thing would be true at some of the other major newspapers that have similar arrangements: The Washington Post, which is under the control of the Graham family; The Wall Street Journal under the Bancroft family; once upon a time, the L.A. Times under the Chandler family. All of these companies have run very sound, profitable businesses while sustaining that civic function of providing good journalism, and they've been able to do that because they didn't have to respond in a panic to every quarterly return. ...
But what they are saying is that ... the family ownership has a management in-house that is not producing enough capital given who they are, not enough profit given who they are and what they've got. They've made bad investments.
I guess I would just respond to a critic who makes that kind of charge: Show me your list of what you regard as the stellar examples of media companies, and then let's sit down and look at what they actually produce.
Meaning that they don't necessarily produce very good products?
Meaning the most profitable companies are not necessarily the ones that are producing something that you'd be proud to be associated with.
For one thing, clearly there's a dollar issue going on here, and clearly it depends on who owns you and what they're looking for out of the property, how much of what they're looking for is profit, how much of what they're looking for is long-term viability. You never know.
The L.A. Times' ownership changed, all right? And it changed because some people wanted to cash out. People who were willing to carry an organization -- every major newspaper I know is facing this dilemma, where the family institutions that were supporting these institutions, as the generations go on, there's less interest in being a publisher, a proprietor, if you will, and more interest in what does it mean for me profitably as a family member?
They want to make money. They're not really interested in the family legacy.
Right, and even if they are interested in the family legacy, there's an increasing pressure to make more money, because the public markets are drawn into a lot of these things, even though they're privately run; they're run for stockholders. Whenever you open something up to the public and you bring in a public stockholder, you have to worry about their needs, not just your own. ...
Now, no one can sit here today and tell you what the appropriate level of profit is. ... When the economic model gets shattered, you've got to worry about it. You just have to worry about, what do we have to do to stay viable? And it isn't only about profits today. It's about having the economic viability to weather storms in the future, because you don't want to be in a desperate situation. You don't want to be in a situation where it starts going heavily into losses before you can do anything about it, because then ... you have no control over the decisions you make. You just have to make ugly, brutal decisions.
So I don't ascribe the same concern to somebody saying, "We've got to downsize, because here's the economic reality." I mean, I think that's true. My goal, though, would be, as a publisher and as a journalist, to build revenue sources up that allow you to keep a first-class news organization. Increasingly that means you've got to do things other than just print a newspaper.
Well, The Washington Post has Kaplan, [Inc.].
No, no, I mean within news itself. The Washington Post built aggressively, is building an online business, which increasingly is part of its business. Not only is it increasingly an economic portion, but almost as many people in Washington now read The Washington Post on the Web as read it in print. In fact, it might be higher in Washington. It's close. Think about that. We've only had, what, 10 years of the Internet on The Washington Post, and in 10 years they built an audience even within the boundaries of Washington itself of as many people who read it in the print read it on the Web.
But the same thing is true of The New York Times; the same is true of the Los Angeles Times. More people read the Los Angeles Times online than buy it, right? I'm just asking you the newsroom question that we got, the question that John Carroll raised with us and others. We're making over 20 percent profit. ... We give you your 13 Pulitzer Prizes. You look great, you love that, and you're telling us to cut, and every year you're telling us to cut more, and you're cutting to bone. Their complaint, the publisher who got fired, [Jeff Johnson], his complaint was you can't cut your way to success.
I agree. There is a point where that's true. Now, I'm not as familiar with the internal workings of the L.A. Times, but my instinct is that he totally believed that and the editor believed that, and they're the two closest people to it. So as a corporate entity, you have to either back your guys or think you know more about the situation. ...
The company is for sale. I mean, what does that tell you? If the shareholders think the company should be sold, it says the management isn't running the company the way it should, isn't doing what it should with this company, and the shareholders aren't happy about the fact that the best and the brightest people in the company are quitting because they think that the moves that top management's making are damaging.
Well, it's kind of unprecedented to have a publisher publicly disagree with his home office and the editor to publicly disagree in the pages of their own newspaper.
It's astounding. What that says to me is that the management's failed in both engaging its own team to understand what the goals are, or they changed it. They changed the game.
I interviewed the new publisher of the L.A. Times, [David Hiller], who used to be the vice president for development, who still stands behind the original merger, which apparently was his idea. ... When I asked him this question, "What's this about 13 Pulitzer Prizes and cutbacks at the same time? It seems like a contradiction," he basically said, "That's capitalism."
Well, I hate to do this, but I wouldn't build this on 13 Pulitzer Prizes. I would build it on, how does it serve its readers? What is the real value? Not to say that 13 Pulitzer Prizes don't help define that, but the value of that paper to its audience is what's in question here. ...
The L.A. Times is one of the four major newspapers in the United States and one of the few that does consistent international and national coverage.
Right? They compete on every major story. That's what they're set up to do.
It appears that what's going to happen is they will no longer be doing that on a national and international --
And that's dangerous. I agree with Baquet; I think that does cut into what you're supposed to be. ... They're supposed to be a news organization that does compete around the world. That is one of the places, one of the few, but one of the places that watches not just institutions but the result of the work of institutions and watches who we are, reports back, informs the public of what its government is doing, what's happening outside of their sphere of knowledge.
The Los Angeles Times, which you've come to, has been embroiled in a public controversy about cuts and cutbacks in the newsroom and staff leaving. What's this all about then?
I think two things. One, there is a perception that the industry is in decline because of readership problems, and we do have readership problems. But it's not like they can't be reversed; I think you can. I think we have to change as an industry. And secondly, when any industry gets into some problems, they have to cut back. That's just part of life. ...
More people are reading the Los Angeles Times today than ever in its history. It's just that not everybody's picking up the paper and buying it. They're getting it online, and they're getting it in the paper. And when you look at our audience, it's actually larger, but we haven't figured out a way to actually monetize that and be able to charge for that information. And when we figure that out -- and we will -- we'll be a very successful business again.
Do you know [former L.A. Times publisher] Jeff Johnson?
Never met him?
Oh, I met Jeff very briefly. When I say I don't know him, he and I have never really sat down and had an extended conversation. ...
But you did work with [former L.A. Times editor] Dean [Baquet].
I worked with Dean, yes. I did.
His fear is that -- along with his predecessor, John Carroll -- that the guts are going to be cut out of the news organization in these cutbacks, right?
He and I have talked privately and as friends about cutbacks, and I don't want cutbacks either. But I'm a realist. If your revenues are starting to fall and your expenses continue to go up, that's not a good formula. So something's got to give, and you have to start saying, "OK, what do we have to do to reverse this?"
I guess my difference is I don't have the time and the focus on, well, what caused the problem? The only thing I can really focus on is, what's the solution? How do we get out of this? ... And that's what is going on right now.
The Los Angeles Times, under John Carroll and Dean [Baquet], won, I believe, 13 Pulitzer Prizes. Yet they're asked to cut. It would seem like you would want to build on that rather than cut.
I do want to build on that. I have to build on it in a different way, though. Dean and John both focused a lot of attention on the newspaper and not enough attention online. I think if you asked them both, they'd probably say that's right. I have to look at it and say, OK, I have to figure out what's the right balance between the newspaper and online to establish a news organization that draws a larger audience of readers. ...
The question seems to be, with declining revenue from the newspaper, the hope is that it will be replaced by increasing revenue online. Is that right?
And then some numbers I just looked at say that a subscriber to a newspaper is worth, to the news organization, approximately $1,000, but someone who's reading it online is worth about $5.
Right. Right, right.
Will the Internet revenue ever catch up to the newspaper revenue? How can that possibly happen if that's the different scale of --
Well, it's a different scale now, but if you can create a larger audience online, you can start charging more for it. ... The Los Angeles Times has to become the premier locally edited and produced newspaper for Southern California that gives our readership the best information about the nation, the world, the local region, the state of California, and it has to deliver it both in print and online.
At this time, our biggest audience is print, and nobody says you can quit investing in that; you have to. But the big key thing is you have to figure out, how can I take some of the assets that I have invested in the newspaper and convert them to online, and build a bigger audience online? ... Well, I say online will become the discovery area of our organization: This is where people will go to discover things, and this is where people will go to find breaking news, and this is where people will go to find out, well, if I want to take a trip, how do I book it, and where do I go? ...
One of the main investors in the Tribune Company, [vice chairman of Ariel Capital Management Charles Bobrinskoy], said to us [the Los Angeles Times] has to go local and give up the idea that it's one of the big national newspapers, that it's kind of the New York Times of the West Coast or a competitor with The New York Times on all major stories.
I don't totally agree with that. I don't think the Los Angeles Times can be successful by relying on someone else to cover the world for it. Can't happen. People here want more than that from the Los Angeles Times. ...
Now, should it be The New York Times? No. The New York Times is The New York Times. The Chicago Tribune is the Chicago Tribune. The Los Angeles Times should be the Los Angeles Times, because that's how it will be successful. And being the Los Angeles Times is being a major newspaper in America, covering not only the city but also the nation and the world.
Today the Los Angeles Times competes with The New York Times on most major national and international stories, so the fear is that it will disappear from that regular competition on all major national and international stories and that it's one of the only other general-interest newspapers in the country that does that.
I don't know of anybody that's advocating that we will disappear from the national or foreign scene. ... But I think you also have to cover Southern California. If you don't cover your own backyard, you are going to lose a lot of readers. You have to cover it; any newspaper has to do that.
But your predecessors would say exactly the same thing. They would say, "We do a better job of covering the region and the state, but we also have to have this national and international presence, and we're in danger of not being able to do that."
Well, I agree with them on that issue. Do we have to have exactly the same number of people we have today covering that area? I don't know that. I don't think that is necessarily true. You may have to adjust a little bit. ... Maybe some people have to change their beats, work a little harder, but it doesn't mean you quit covering Washington. ... And that doesn't mean I'm going to give up covering the war in Baghdad. We have to cover the war; people want that. It's our obligation to cover that. ... But I also believe you have to be in Sacramento covering the State House. ...
How many people does the Chicago Tribune have in Washington, D.C.?
I would say probably somewhere between 15 and 20. I don't know exactly anymore. I think at one point we had about 19 people in Washington.
And the Los Angeles Times has?
Probably double that.
So the fear is that you won't have the same kind of in-depth coverage because you'll be redeploying resources here into the state?
Well, that may be the fear. ... Let's say I have 40 reporters in Washington and suddenly I decide I'm going to have 35. Does that really mean that I'm going to lose depth? I doubt it. I covered Washington for 10 years. I know a little bit about how to do it, and it's not related to the number of people you've got there; it's related to the quality of people you've got there and what kind of story they're after. ...