Hearst Corp. threatens to close Chronicle
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| Scott Beale/Laughing Squid |
The Hearst Corp. announced Tuesday that it would be forced to sell or close the San Francisco Chronicle if it could not make needed “critical” cost-cutting measures, including job cuts, in coming weeks.
The company said the paper lost $50 million in 2008. A memo to employees from the publisher, Frank Vega, said the paper could no longer bear the “staggering losses,” which he said were worsening in the current recession.
“Survival is the outcome we all want to achieve,” said a statement from Hearst quoting two top executives, Frank A. Bennack, Jr., vice chairman and chief executive officer, Hearst Corporation, and Steven R. Swartz, president of Hearst Newspapers.
“But without the specific changes we are seeking across the entire Chronicle organization, we will have no choice but to quickly seek a buyer for the Chronicle or, should a buyer not be found, to shut the newspaper down,” the statement said.
The Hearst-owned Seattle Post-Intelligencer will be shut down in March unless a buyer is found.
“This is a serious situation,” said Carl Hall, a representative of the Northern California Media Workers Guild. “We’re interested to hear the company’s explanation.” The Guild, along with the Teamsters, represents most of the Chronicle’s employees.
The Guild is meeting Wednesday with Hearst Corp. representatives to begin an impromptu round of negotiations. “We will talk to them in good faith. We are not going to pretend the problem doesn’t exist,” Hall said.
“It’s pretty clear they want to reach an agreement with the union and it is our intent to reach an agreement that everyone can live with,” Hall said. “It’s important for everyone to face up to the reality that the business is in deep trouble.”
Hall said he did not know the magnitude of job cuts, but said he doubted that eliminating even hundreds of jobs would necessarily make a difference, because the company lost $50 million last year.
Chronicle Editor Ward Bushee did not return calls for comment Tuesday night.
The announcement comes amid several other major changes at the144-year-old paper. This month the paper launched an extensive print redesign. And a Canadian company, Transcontinental Inc., is set to take over the Chronicle’s printing at the end of June.
"Is this a move to go just to a web-based newspaper? I wouldn't be surprised," said Robert Rosenthal Executive director of the nonprofit Center for Investigative reporting in Berkeley and the former managing editor of the San Francisco Chronicle. "I think anything they do now will involve major cuts of journalists and accelerate the downsizing. It will mean less information for the public and it will be a setback in terms of keeping a watch on government, business and all the other things that the press has played a crucial role in covering for over 200 years in this country.”
Related: TPP Blog, "San Francisco Chronicle could close. What will fill the void?
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Bethany writes part time for SF Public Press and also works as a restaurant cook and baker.
Comments
I'm seeing more and more newspapers going bankrupt at the moment, largely due to advertising revenues shrinking, especially in regard to job ads and classifieds. The Internet is able to reach more people far cheaper, so in my opinion, unless newspapers reinvent themselves in some way, they are likely to die off over time.
Whatever happens at the Chron, I'm confident that good journalism will endure here in the Bay Area and nationwide. Now is the time for all good journalists to help to build the newsrooms that will keep the public informed if corporate giants like Hearst shutter their castles. It will take dedication and hard work with few immediate rewards, but there are great places to start, like Public Press, Spot.Us, Newswire21, Newsdesk or my site, RedwoodAge.com. So please pick one and pitch in. Who knows? The job you create may be your own.
It's clear that you have the technology chops to implement a web 2.0 version for SF Reporting based on the tools used here.
Hearst's announcement could also affect MediaNews. Remember, MediaNews owes a lot of money to Hearst, and until now Hearst has been patient in being paid back. Dean Singleton has even acknowledged that.
Today's announcement could signal that Hearst's patience is wearing thin. I can't believe that Hearst would implement huge cuts and not want money owed from Singleton. Stay tuned, because MediaNews remains heavily in debt ... to Hearst.
Very happy to see The Public Press website & blog responding in real time to news items where the organization is so strongly implicated. Web 2.0 and social media are essential tools for any nonprofit endeavor to scale up its operations and awareness, especially among supporters and key constituents who might be looking for new models in the current economic environment. Recruiting volunteers who can guide an energetic social media strategy for The Public Press will position you to fill the void quickly, if and when The Chronicle either closes or consolidates into some sort of non-local newsie mess. Now more than ever, energy, initiative and entrpreneurial spirit from nonprofit leaders and funders may be required if our city and region are going to sustain a business that can deliver a quality print daily newspaper in the months and years ahead.
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