There was little newsworthy in Bob Dickey's remarks about further expense cutting during a Wall Street stock analysts conference Wednesday, until the newspaper division chief (left) mentioned the Interstate Group of papers -- and copy editing.Corporate has made no secret of its hunt for ways to consolidate even more printing of newspapers at a single site. Now, Dickey has revealed the savings: He told the Media and Entertainment Analysts of New York that 25% of costs excluding newsprint are in printing and distribution.
Today, 21 Gannett papers are printed at another paper's press, including at non-GCI papers, Dickey said. The Coloradoan in Fort Collins just announced that it's moving printing and distribution to the Denver Newspaper Agency; 48 jobs will be eliminated. Compared to a year ago, consolidation has meant savings in the "high teens,'' he said.
Indy as a hub?
But Dickey caused major heartburn when he started talking specifics, revealing that Corporate is now studying 25 papers that could be candidates for consolidation -- and not just in production; he talked about establishing a regional copydesk, and referenced the Interstate Group based at The Indianapolis Star. Dickey did not identify the 25 papers, or say how many jobs might be in play, however.
A Gannett Blogger, apparently using an average 40 jobs per paper, quickly did the math -- and issued a warning to anyone working near a press with a "window" of opportunity for more printing work."I think eliminating 1,000 production jobs at 25 newspapers is a big announcement,'' wrote Anonymous@10:15 p.m. "Dickey said it yesterday. Did we miss it? If there is a press close to your newspaper that has a window, start looking for work."
Corporate's conspicuous silence
I waited until now to post on Dickey's remarks, especially concerning the Interstate Group, because I thought Corporate might weigh in with a clarification, to ease any unnecessary worries among employees -- at least on timing. Thousands of employees could be affected: In addition to the Star, Interstate's portfolio includes three other metro papers: The Cincinnati Enquirer; The Courier-Journal in Louisville, Ky., and The Tennessean in Nashville, plus smaller dailies and non-dailies in Indiana, Kentucky, Ohio and Tennessee.
But it's now been 48 hours, and all we've still got is Dickey's response to an analyst's question about more cost-cutting. I transcribed the quote last night from the webcast, available here at Corporate's site through April 1; to get there, fast-forward your media player to approximately the 40-minute, 40-second mark, and you'll hear Dickey talking about the 25% cost savings, followed by:
"We're also looking at a very aggressive opportunity to regionalize within the division, particularly when you look around our Indianapolis newspaper and our Interstate Group. We have four large metro newspapers there, that we can utilize as hubs. And that covers a wide range of activities and duties -- everything from copyediting to sales and marketing activities to the printing and distribution side. It impacts the entire operation, when you look at those opportunities."
He continued: "That's probably the No. 1 thing at this point in time, is the regionalization. Other opportunities that we're reviewing currently are, can we consolidate some call centers in the areas of circulation and classifieds, which would lower costs in line with the current revenue stream.''
Related: a 1-hour replay of Wednesday's conference, available through April 1 on Corporate's website
Please post your replies in the comments section, below. To e-mail confidentially, write gannettblog[at]gmail[dot-com]; see Tipsters Anonymous Policy in the green rail, upper right.
Interstate Group?
ReplyDeleteThere could also conceivably be some regionalization or combinations between Wilmington and Salisbury, Md. Salisbury prints a small-ish daily (around 25K) and multiple weeklies; Wilmington prints a larger daily (around 100K), USA Today and several niche products.
ReplyDeleteI don't see printing being combined, because the distance between the two sites is so far (about three+ hours). But copy editing very easily could be centralized in Wilmington.
I have no inside scoop, but just thinking about it makes me think it's possible.
I think after everyone's converted to the 44-inch web we'll see, not only printing consolidation, but ad services and page desig being merged with other papers. I think for now Gannett will leave the copy desks where they are.
ReplyDeleteI heard this, too, but thought this was what GCI was already doing bit by bit. So if GCI regionalizes the copy editing and the printing at these plants, then why not regionalize management, too? So we have the apparently one-by-one departures of executive editors. And is there any need for the bureaucracy at the denuded papers, or the bookeepers, etc? You could leave an M.E. in charge, and the advertising staff. Makes sense. But the downside that I see is that these are small cities where the newspaper is often the largest employer. The departure of these jobs will be noticed and felt by storeowners and other advertisers. There will be a local backlash. There is also a big logistics problem, as a fleet of truck drivers are needed to replace those operating the presses.
ReplyDeleteThis is a huge issue, and could bring some major changes to the four newspapers in question. I don't see how printing could be consolidated among the four, but certainly classifieds, some copy editing and other tasks. Most likely, in my opinion, GCI would look at the small papers in Tennessee, Ohio and Indiana as candidates for losing work. But who knows?
ReplyDeleteBelieve it. Common platforms at small papers and large ones make this possible. It will/is happening. Bigger issue comes when the company tries to sell properties. The buyer would have to buy the entire hub and offshoots or rebuild entire parts of the local newspaper's business such as call centers and a central copy editing center. Short term, this may be good for bottom line (although horrible for quality). Longterm, a tricky strategy as it would be costly for someone else to come in and buy knowing they had to hire extensively or rework outsourcing.
ReplyDeleteMr. Dickey:
ReplyDeleteSir, have you actually READ any Gannett papers lately? Have you actually READ the web sites? Can you ascertain how far these newspapers have fallen in quality? Don't count corrections. Many of these stories are written so illegibly, they don't have enough in them to warrant a correct.
It is a group-think misnomer to believe that the circulation and revenue dives are wholly attributed to the Internet. Go take a poll with our ex-subscribers. This company loves research. Well, go research it.
So, the answer to all this, and the stock price collapse, is to cut more jobs, so that copy editors who know nothing about, say, Louisville, are now reading copy from rookie reporters who themselves can not adequately cover their beats around Louisville and don't know what they are writing about.
So we have no new initiatives? No ideas? No new newsletters? Magazines? Internet efforts? (Oh yes, Pluck has plucked us.)
This is what passes for running a business? Do you have a conscience, sir?
Who would buy this company's stock? I'm amazed there are still stock analysts willing to talk to you. Things must be really bad up on Wall Street.
Consolidation in some form is probably going to happen sooner rather than later. Whether one agrees with it in principle or not, there is a logic to it and it would allow the elimination of more jobs. Whether it be a centralized copy desk or shared production duties, Gannett needs to find ways to produce the same products in cheaper ways. It's not a whole lot different than any other business in that way. Honda doesn't have manufacturing plants in every single state or country. Hostess doesn't bake cupcakes in every city. Those things might serve the consumer well and create more jobs in more places, but it isn't feasible anymore to fully staff all 80some papers and USA Today. In the eyes of corporate, there is too much duplication of jobs.
ReplyDeleteOf course, we all know consolidation brings on stresses, reduces quality and would occur exclusively to save money. It would have nothing to do with producing better products, creating better workplaces or anything else. But that's the reality we live in now and it's bound to happen fairly soon. Jobs will be lost, including copy editors.
Somewhat related to this... What always kills me is that Gannett continues to feed the monster that is USA Today. Layoffs have been minimal there compared to the community division. They continue to hire, mostly digital "journalists" and technicians for a web site that is growing in page views but not in profits from what I read. For a thin, 5-day paper, it's still staffed well, even though folks there will tell you they are stretched to the max. Maybe some are, but please...you want to see stretched? And there is just no evidence that USAT shares in the sacrifices we are all making in the communities. I mean, geez, look at their building! Have you seen other Gannett properties?
So before there are anymore jobs lost or consolidations are made elsewhere, I hope someone is taking a long look at USAT. Nothing against the paper or the people there, but this have and have-not system Gannett has been running for almost three decades has to come to an end. There has to be more balance. USAT does not carry this company! It's an important piece for branding reasons mainly, but it's not the star player it might have been at one time.
I always wondered why Gannett didn't seize these consolidation opportunities long ago. It's Business Management 101.
ReplyDeleteIf the company had done these things gradually as they purchased larger papers over the years, they could have used attrition and retraining to reassign staff and avoid any layoffs. The ill will Gannett is fostering may be irreversible, even if the newspaper economy recovers, which I doubt.
Dubow could teach Crisis Management 101, at Liberty U., perhaps.
8:36
ReplyDeleteIt would not take a fleet of drivers. Typicaly a box truck or two is all they'd need.
I agree with the question posed by 4:23. Where did the Interstate Group name come from? I had not heard that before.
ReplyDeleteThis will certainly happen. Radio stations consolidated years ago. Of course, it will cause an even further decline in subscribers because regionalized copy desks won't have any institutional knowledge. But if the savings are great enough to outweigh the loss of revenue in advertising dollars, it's certain to happen.
ReplyDeleteWe are doing exactly what the radio industry did years ago, and it will most certainly continue. It makes business sense ... as long as you aren't concerned with putting out the best possible paper. And, clearly, Gannett has zero interest in that.
When the graphics deptartments were consolidated in the WI central papers late in 2007, to the Wausau site, a former co-worker (who was a victim last fall) predicted that it would only be a matter of time before the 4 papers would merge into one regional paper.
ReplyDeleteThen in late spring early summer 2008, all printing was moved to Wausau, and this person stated again that the move was happening quickly.
I talked to this person just last week and the prediction was that there would be certalization of all functions from the Wausau site, Reporters and Sales Reps would work remotely from laptops and home offices. The 3 southern sites would empty and the GM's and Sales and Circ managers will be out of jobs, as well as the local Managing Editors.
As with the CentralWisconsin Sunday paper which is circulated to the 3 southern sites already, the Daily news would all be the same content with this plan, and either run under the existing mastheads with identical content or Gannett would FU big time and change to a single masthead for all the 3 sites. Of course the Wausau site would continue to run it's own press runs and distribution but the content would cross over into the southern regional paper as it does now.
Is it going to benifit the communities the papers serve? Not a chance. Will it cut corporate expences? Certainly. And which do you hink Gannett will choose?
So far this person's predictions have been dead on. Now with Dickey's announcement, it's clear the rest will also come to pass.
Would someone please list all the papers in the Interstate Group?
ReplyDeleteFor that matter, we could all use a list of all the papers, arranged according to which of the four groups they fall under: Interstate, East, South, and West.
9:11 raises excellent points about what happens should Gannett decide at a later date to sell these papers. What value will they have if buyers must first rebuild the infrastructure -- customer service, sales, etc. -- lost to consolidation?
ReplyDelete"For that matter, we could all use a list of all the papers, arranged according to which of the four groups they fall under: Interstate, East, South, and West."
ReplyDeleteWe, that is Gannett employees, have access to this in a document that is freely available. You, as a non-Gannett employee do not have access to this document.
You should be careful with your distinctions.
The Interstate Group was formed on April Fool's Day 2005...very fitting given the missed opportunities and the people in charge.
ReplyDeleteBarbara Henry, then president and publisher of The Indianapolis Star was named senior group president of the group at its formation.
The new group placed The Cincinnati Enquirer, The Courier-Journal, The Tennessean, and Gannett’s other daily and non-daily publications in Indiana, Kentucky, Tennessee and southern Ohio under her control.
http://tinyurl.com/cc3hew
9:11 is right on the money. Being folded into one of these regional organizations is a death sentence for any of these newspapers. No one will buy them. I have a related question and that is does a local paper lose its legal ads if the paper is printed out of the city/county? Most of the legal ads come to local newspapers on the grounds the paper is printed in the community. If it is not printed there, do legal ads disappear or go to the Web? (I have long wondered why local governments don't just publish this stuff on the Web anyway) This is not a little issue, by the way, because legal ads are unbelievably lucrative because historically then had to be preprinted and proofed by laywers before they ran.
ReplyDelete11:22: "We'' also refers to stockholders, which includes me.
ReplyDeleteTo answer your question, Jim, Gannett is defoliating its newspapers when it should be dressing them up for sale. Valued by the world at $2+ per share, Gannett's business model is a goner. Chain-style ownership is passe'. Yet when Gannett finally gets real and puts its papers on the market, bids will be low not only because of reduced revenue and terrible technology platforms, but because buyers will have to restore entire functions like finance, customer service, copy editing and, should they choose to go the dead tree route, press plants.
ReplyDelete9:19 wrote: "... so that copy editors who know nothing about, say, Louisville, are now reading copy from rookie reporters who themselves can not adequately cover their beats around Louisville ..."
ReplyDeleteIsn't it interesting that more and more newspaper companies are pushing this idea of "local-local" content and yet more and more actual production of said "local-local" content is produced elsewhere?
Folks - it's much easier and cheaper to bus papers than to employ people. You don't really think GCI will employ people over buses or trucks, do you?
ReplyDeleteI think Lansing is part of Interstate?
At least it was when I was there... I hear Detroit calling it's name!!! Bye bye production...
It strikes me there's something -- dare I use the word? -- immoral about people in one city editing news stories by reporters in another city. Perhaps generic feature copy would be OK edited at a central hub, but news copy? One hopes our corporate masters wouldn't go that far, but I don't have great hopes.
ReplyDeleteCopy editors are valuable for their local knowledge and their institutional knowledge, both of which are going to be lacking when it comes to long-distance editing.
Just look at our web sites -- typos and other errors proliferate. Quality's not Job 1 anymore.
Sorry to disagree with 11:48 and others with similar views, but from a buyers perspective there’s more opportunity. And, you likely won’t need to own a press to do it…at least that’s the case in the markets I’ve been reviewing – and that includes printing seven days a week if desired. Plus, there are more than enough experienced newspaper people available to make it happen.
ReplyDeleteAh. Now I understand.
ReplyDeleteJust a few years ago the publisher of the Cincinnati Enquirer happily announced a major upgrade of the presses, which were in horrible shape after decades of use. It was something north of a $60 million investment, if I recall.
A year or so later that went away with no explanation and more a minimalist upgrade proposed. The presses weren't in the long-term future for a newspaper -- go figure.
That suggests to me that discussions of production consolidation were going on in some circles at that time, likely in concert with the forward looking outlook of cutting newsrooms by up to 50 percent over a short period of years(and those discussions absolutely did take place).
And we are seeing the play unfold before us like a Greek tragedy.
9:19
ReplyDeleteYou are sooo right!
Looking at some of the stories that get into the paper where I used to work (now retired, thankfully), they are pathetic. Kid reporters in the newsroom who get no direction and barely can find the courthouse, let alone know what they should be covering inside. There also are the usual batch of press releases that get in verbatim, usually with a "Staff Report" byline concocted to indicate that someone actually did some reporting.
A sorry state to be sure.
The Tennessean is not in the interstate group anymore. It is now in the South Group.
ReplyDeleteThis Dickey plan looks moderate, but it is actually very radical. If you are going to take away the copy editing functions from a local paper, why stop at giving them to a regional paper but instead go for big savings by shipping these functions to India? You have the same issues of unfamiliarity with the details of a community with regional desks as you do with India. Regionalizing the presses is also fraught with difficulties leading to non deliveries. But perhaps most importantly, it all just opens the door to a competitor stepping in and starting up a locally-based competition which can sell itself as really being community-based. Dickeys plans are taking the community out of community newspapers.
ReplyDeleteInterstate Group.
ReplyDeleteI wonder what other groups and systems GCI has set up that no one knows about?
All I really want to know at this point is when to expect job cuts in Louisville, and which jobs are going away.
@2:25 - You are amazingly ignorant.
ReplyDelete2:27, enlighten me, oh wise one.
ReplyDeleteJim, I take back my last comment at 2:36. I should have been more mindful of your note above the Leave Your Comment field.
ReplyDeleteI am not looking for a flame war, only what many other readers of this site are looking for: any legitimate information regarding my job.
If that, or asking what else GCI is doing that we're not aware of, makes me ignorant, say what you will. Have a great weekend.
2:45,
ReplyDeleteWhile the other poster lacked any sort of bedside manner, his or her point was pretty clear to anyone who's been paying attention to Gannett and this blog. And that point is simply that NO ONE KNOWS. No one here, anyway.
You want to know how many jobs are going to be cut at your site, and whose they are? Wait until layoff day.
2:45, we're all ignorant. Gannett wants to keep us that way, and we wouldn't know half of Gannett's greedy, cruel and idiotic (GCI) ways were it not for this blog. We built this company into what it is, and management is throwing us out the window in its pursuit of grandiosities with no real vision and in total disregard of the fact that news -- exclusive news -- is and always will be a sellable product.
ReplyDeleteYou are ignorant because you choose to be ignorant. Information about the company, lists of sites within groups, directories, information about what is happening can all be found on the company Intranet. It will, however, take a little initiative on your part to become less ignorant.
ReplyDeleteConsolidating does make good business sense. The regional toning centers are an excellent example of how it will work. The RTC has missed a few deadlines but after the kinks were worked out of the system it’s doing a great job.
ReplyDelete9:19:
ReplyDeleteYou ask if Dickey has read the Web sites?
He probably got bored with waiting for them to load.
What has been referred to in the past as the interstate papers or the LINC group of papers, is Louisville, Indy, Nashville and Cinci.
ReplyDelete@5:12 - you are wrong. The Interstate Group includes many more newspapers that the ones you listed.
ReplyDelete3:53
ReplyDeleteTHANK YOU!!!!!!
The people who work for Gannett are surprisingly ignorant about how it operates. They act like sheeple and expect us to feed them. They are one more reason this comapny is failing.
You are ignorant because you choose to be ignorant. Information about the company, lists of sites within groups, directories, information about what is happening can all be found on the company Intranet. It will, however, take a little initiative on your part to become less ignorant.
ReplyDelete3/20/2009 3:53 PM
3:53
THANK YOU!!!!!!
The people who work for Gannett are surprisingly ignorant about how it operates. They act like sheeple and expect us to feed them. They are one more reason this comapny is failing.
3/20/2009 6:03 PM
And with so many of us not having access to the company intranet from home, and burried to our eyeballs covering the jobs of those who have been laid off AND those on furlough, when are we supposed to have TIME to scour the intranet?
http://www.gannett.com/about/map/community.htm
ReplyDelete6:18
ReplyDeletehow long have you worked for this company? 3 months? You were hired after the December layoffs?
Give me a break!
The Interstate Group was formed years ago.
OK, names of groups and which papers are in them change up fairly often.
ReplyDeleteWhat you need to pay attention to is what regional president your newspaper reports to. That person has as much influence over your immediate future as the folks at corporate.
I heard at least some of the publishers had a meeting Friday afternoon. Will post details when/if I hear them.
The super regional copy desks are probably coming fast, I would guess.
I heard Michael Kane discuss this type of thing last year.
My sense is it would already be done but for one thing: Gannett foolishly allowed local markets to pick their own operating systems and technology over the years. Now they've got outdated, incompatible equipment to overcome.
But watch what's going on around you. Look at Seattle. Look at Denver. Look at the printing consolidations. Look at Detroit cutting back drastically on print distribution.
Expect Gannett to keep regionalizing at a few key hubs and cutting everywhere else.
For those who think this ends chance of sales, realize that any chance of sales was probably gone several years ago. Gannett benefits from massive pricing discounts on newsprint, hardware, software, human resources services (think Hewitt and insurance) ... even before the end of local printing or local copy desks, it would have been very difficult for a private owner to pick off one of these sites without much bigger costs than Gannett faces.
Whether you're chosing to stay or simply can't get out because of hte awful economy, we are on the final voyage of newspapers as you knew them. Let's try to travel with some class, shall we?
This idea actually doesn't bother me at all. Our copy editors don't know, or give a damn, about our community and regularly edit mistakes into stories. They can't recognize mug shots of very public local figures. What's the difference if they're here or 40 miles away?
ReplyDeleteConsolidations in news, graphics and other departments will further expose the disparity in pay between various newspapers, most notably how little people get at the smaller dailies and commmunity weeklies. Those folks, if allowed to stay, need to keep their ears open as there's precedent for paying them more once they find out how wide the gap can be.
ReplyDeleteAnyone hear of any Gannett papers consolidating/cooperating with other, non-Gannett papers in the region?
ReplyDeleteThis idea actually doesn't bother me at all. Our copy editors don't know, or give a damn, about our community and regularly edit mistakes into stories. They can't recognize mug shots of very public local figures. What's the difference if they're here or 40 miles away?
ReplyDeleteI'm sorry to hear you have such a sorry copy desk, but OUR copy editors DO know the community and do very much give a damn about it. I'd like to think your copy desk, if it's as bad as you say it is, is an anomaly. Because if we were to consolidate where I work, there would be a vast amount of institutional knowledge lost.
Conversely, being asked to edit copy for another city you're unfamiliar with would be incredibly frustrating, for the very reason that we do give a damn and want to do our best.
They have already consolidated some jobs from Louisville to Indy
ReplyDelete