Editor's note: This is the second of a series of articles on the financial crisis facing The Seattle Times.
The Seattle Times Co. has become infatuated with preserving its independence as a family-owned media company, and perhaps Times Publisher Frank Blethen's greatest achievement has been holding together the five generations of Blethens around this civic mission.
The danger, however, is that this noble mission has prevented the company from reaching out for help, learning how to partner and to diversify. That trend, more than the Internet, is what defines the new economy of leveraged cooperation. By missing this boat, the Times Co. ended up at an awkward size – too small, not diversified into broadcasting, and yet with lots of overhead to support.
So now the company has decided to cut its way back to profitability – a very difficult course for a business built on public service, especially one with a unionized workforce. A program of layoffs, bureau closings, and editorial cuts will not exactly make the public rally to the state's leading newspaper.Another way to look at metropolitan newspapers, and maybe a formula Times management could still adopt, is to expand the business by selling more products. For instance:
- Take all that good news product and sell it to other outlets, such as newsletters, specialty publications, global news services, and Web publishers.
- Use the distribution service of dropping papers on front porches to deliver all kinds of other things: magazines, marketing samples, other print products. There's a huge investment in this service, which few other companies can match.
- Create an advertising network, selling ads for national media, specialty publications, radio stations, etc. Again, newspapers have the team in place.
- Same for commercial printing, which is growing fast. You could spin these printing plants off, with the dailies being just another customer.
- Sell digital services, such as Web site design, e-mail newsleters, search marketing, and much more. Here again, the papers have some of the best local talent already assembled.
All this would require a mighty big culture shift, and newspapers have allowed themselves to become major resisters of change. But making changes that involve an enlargement of business, hiring more folks, and exciting new business challenges would seem easier to pull off than passing around hundreds of layoff notices.
One last bit of advice. The best way to make this change happen would be to take on a major new partner, probably one that is already hip to the new economy. In short, take a page from the Microsoft playbook as it tries to graft Yahoo culture onto its somewhat sluggish company culture. Seattle would seem to be a perfect place for The Seattle Times to find such a new bedmate, assuming it can shake off generations of going-it-aloneness.
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