Crunch comes to US newspapers

VIEW FROM LOS ANGELES

The axe-wielding Mark H Willes has struck fear into the newspaper industry, earning himself a cereal packet-inspired nickname of "Cap'n Crunch" in the process. The recently appointed president and chief executive of Times-Mirror, one of America's largest publishers, has cut a swathe through the company's costs as the industry suffers from overstaffing and soaring newsprint prices.

Newsprint prices have also taken their toll of jobs in the UK. Hundreds of jobs have been lost recently at United Newspapers, Associated Newspapers, and at the Independent.

The cuts at British papers are overshadowed, however, by the storm whipped up in the US by "Cap'n Crunch".

In the last fortnight, Mr Willes has closed New York Newsday, one of the city's four papers, and cut 1,000 jobs at the Los Angeles Times, the flagship title at Times-Mirror, creating general appraisal of the industry's financial prospects.

The Manhattan edition of Newsday - the so-called "tabloid in a tutu" - had lost $100m over 10 years and the shutdown will save Times-Mirror $10m annually with the loss of 800 jobs.

Elsewhere, 1,750 more jobs will be lost. The Los Angeles Times will cut 150 editorial positions and close a daily Washington edition, the loss of which marks the end of plans to rival the Washington Post and the New York Times.

Under pressure from the majority-owning Chandler family and investors, Mr Willes was brought in to improve Times-Mirror's lagging performance.

He was a former governor of the Federal Reserve Bank in Minneapolis and also revamped General Mills, which involved the sale of its restaurant division and retail holding. He began at Times-Mirror six weeks ago.

The speed at which the axe came down on Newsday, a Pulitzer Prize-winner with a circulation of 231,000, has created interest in a man with no previous experience in publishing but one with a keen eye on the bottom line of finances.

"You need to be relentless in pursuing change. You can't take small steps; you must take big, discontinuous steps," he said recently. Mr Willes, media analysts point out, has no profile in the industry, which allows him to make drastic changes.

"He's by no means tied to the newspaper culture. I don't think anything is sacred to him," said a person close to the company.

Times-Mirror's stock has long lagged behind that of other media companies, partly because Wall Street has judged the company's costs to be too high. After the cuts, estimated eventually to save the company $50m, shares in Times-Mirror rose 25 cents to a year's high of $27.25.

The company, which has cut its workforce from 8,500 to 6,200 since 1990, was once so plush that its journalists called it the "velvet coffin". In recent years, the once-acquisitive company has become the subject of numerous takeover rumours.

The LA paper's editor, Shelby Coffer, noted that the title still has the largest editorial staff in America with more than 1,100, complete with a news-gathering budget of $110m a year. At its peak in 1990, the paper enjoyed a revenue of $1.125bn. This slid to $992m in 1993 before rising slightly this year.

"Publishing is a business, and journalism isn't," Mr Coffey said after the cuts, which he blamed on California's still sluggish economic performance. "We are inextricably tied. If we don't succeed on the publishing side, we can't be a journalistic success."

The changes at Times-Mirror reflect the trends in America's newspaper industry, which started to retrench in 1991 during the recession and has been hit this year with a 30-40 per cent increase in the cost of newsprint.

There are 1,538 daily papers in the US and print remains the primary news distribution source. According to the Newspaper Association of America, slightly more than 60 per cent, or 115 million adult Americans, read a daily paper. Sunday editions reach 59 million, or 70 per cent of adults.

Contrary to public perception, the $44bn newspaper industry is still the largest media business in the US. "The reality is that broadcast television news only has a 48 per cent share of the adult population. By any measure, newspapers are still the nation's number one news source and advertising outlet," says Paul Luthringer of the NAA.

However, a glacially slow decline in readership and increased competition made it harder to sustain a second or third newspaper in any market. At the turn of the century, there were 15 papers in New York. There are now three, and only 23 cities in the US currently support more than one paper.

"Evening papers have declined in circulation, and morning papers and Sunday editions have grown," Mr Luthringer said. Industry analysts predict that, as a maturing industry, it will not be as profitable as it has been.

There are more than 100 papers offering on-line editions as supplements or archive services.Other revenue streams, such as movie listings and sports scores are also being explored. "It shows newspapers are offering news distribution in a different way," Mr Luthringer said. "This is how they will stay ahead."

PROMOTED VIDEO
News
Dawkins: 'There’s a very interesting reason why a prince could not turn into a frog – it's statistically too improbable'
newsThat's Richard Dawkins on babies with Down Syndrome
Sport
Malky Mackay salutes the Cardiff fans after the 3-1 defeat at Liverpool on Sunday
footballFormer Cardiff boss accused of sending homophobic, racist and messages
Sport
Rodgers showered praise on Balotelli last week, which led to speculation he could sign the AC Milan front man
transfers
Life and Style
life – it's not, says Rachel McKinnon
Arts and Entertainment
Eye of the beholder? 'Concrete lasagne' Preston bus station
architectureWhich monstrosities should be nominated for the Dead Prize?
News
Lizards, such as Iguanas (pictured), have a unique pattern of tissue growth
science
News
ebooksAn evocation of the conflict through the eyes of those who lived through it
Arts and Entertainment
Arctic Monkeys headline this year's Reading and Leeds festivals, but there's a whole host of other bands to check out too
music(who aren't Arctic Monkeys)
Extras
indybest
News
Anna Nicole Smith died of an accidental overdose in 2007
people
Life and Style
food + drink
Arts and Entertainment
'The Great British Bake Off' showcases food at its most sumptuous
tvReview: Bread-making skills of the Bake Off hopefuls put to the test
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £40,000: SThree: SThree Group have been well e...

Test Lead (C#, Java, HTML, SQL) Kingston Finance

£40000 - £55000 per annum: Harrington Starr: A Global Financial Service Organi...

Access/Teradata Developer, Banking, Bristol £400pd

£375 - £400 per day: Orgtel: Access / Teradata Developer - Banking - Bristol -...

Quantitative Analyst (Financial Services, Graduate, SQL, VBA)

£45000 per annum: Harrington Starr: Quantitative Analyst (Financial Services, ...

Day In a Page

Middle East crisis: We know all too much about the cruelty of Isis – but all too little about who they are

We know all too much about the cruelty of Isis – but all too little about who they are

Now Obama has seen the next US reporter to be threatened with beheading, will he blink, asks Robert Fisk
Neanderthals lived alongside humans for centuries, latest study shows

Final resting place of our Neanderthal neighbours revealed

Bones dated to 40,000 years ago show species may have died out in Belgium species co-existed
Scottish independence: The new Scots who hold fate of the UK in their hands

The new Scots who hold fate of the UK in their hands

Scotland’s immigrants are as passionate about the future of their adopted nation as anyone else
Britain's ugliest buildings: Which monstrosities should be nominated for the Dead Prize?

Blight club: Britain's ugliest buildings

Following the architect Cameron Sinclair's introduction of the Dead Prize, an award for ugly buildings, John Rentoul reflects on some of the biggest blots on the UK landscape
eBay's enduring appeal: Online auction site is still the UK's most popular e-commerce retailer

eBay's enduring appeal

The online auction site is still the UK's most popular e-commerce site
Culture Minister Ed Vaizey: ‘lack of ethnic minority and black faces on TV is weird’

'Lack of ethnic minority and black faces on TV is weird'

Culture Minister Ed Vaizey calls for immediate action to address the problem
Artist Olafur Eliasson's latest large-scale works are inspired by the paintings of JMW Turner

Magic circles: Artist Olafur Eliasson

Eliasson's works will go alongside a new exhibition of JMW Turner at Tate Britain. He tells Jay Merrick why the paintings of his hero are ripe for reinvention
Josephine Dickinson: 'A cochlear implant helped me to discover a new world of sound'

Josephine Dickinson: 'How I discovered a new world of sound'

After going deaf as a child, musician and poet Josephine Dickinson made do with a hearing aid for five decades. Then she had a cochlear implant - and everything changed
Greggs Google fail: Was the bakery's response to its logo mishap a stroke of marketing genius?

Greggs gives lesson in crisis management

After a mishap with their logo, high street staple Greggs went viral this week. But, as Simon Usborne discovers, their social media response was anything but half baked
Matthew McConaughey has been singing the praises of bumbags (shame he doesn't know how to wear one)

Matthew McConaughey sings the praises of bumbags

Shame he doesn't know how to wear one. Harriet Walker explains the dos and don'ts of fanny packs
7 best quadcopters and drones

Flying fun: 7 best quadcopters and drones

From state of the art devices with stabilised cameras to mini gadgets that can soar around the home, we take some flying objects for a spin
Joey Barton: ‘I’ve been guilty of getting a bit irate’

Joey Barton: ‘I’ve been guilty of getting a bit irate’

The midfielder returned to the Premier League after two years last weekend. The controversial character had much to discuss after his first game back
Andy Murray: I quit while I’m ahead too often

Andy Murray: I quit while I’m ahead too often

British No 1 knows his consistency as well as his fitness needs working on as he prepares for the US Open after a ‘very, very up and down’ year
Ferguson: In the heartlands of America, a descent into madness

A descent into madness in America's heartlands

David Usborne arrived in Ferguson, Missouri to be greeted by a scene more redolent of Gaza and Afghanistan
BBC’s filming of raid at Sir Cliff’s home ‘may be result of corruption’

BBC faces corruption allegation over its Sir Cliff police raid coverage

Reporter’s relationship with police under scrutiny as DG is summoned by MPs to explain extensive live broadcast of swoop on singer’s home