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Wednesday, August 7,2013

Editor out, circ down

The State Journal's circulation numbers continue to plummet since introducing a paywall last year

by Andy Balaskovitz
Since close of business Friday, the daily newspaper in this town has been without an executive editor.

Last week, the Lansing State Journal, facing declining revenues, saved itself undoubtedly a six-figure annual salary when it let go Mickey Hirten, the newsroom’s top dog since 2001. The position was eliminated in what publisher Brian Priester told LSJ readers was a “restructuring of the top roles in our news department.” The managing editor, Stephanie Angel, will fulfill Hirten’s duties.

It’s a startling shakeup for the Gannett-owned daily, which has seen a 16 percent circulation decline since it introduced an online paywall in May 2012.  It raised home-delivery rates 41 percent (and more if you don’t pay automatically) for home delivery daily and Sunday. The increase includes online content — whether customers want it or not. It also charges non-subscribers for online content after a certain amount of free stories.

Circulation gains in the number of digital readers are not offsetting those ditching print, according to the latest audited numbers. And the Journal’s headquarters downtown is on the real estate market because it’s too big for the gaunt staff levels working there.

A month before the paywall went into effect, the Journal reported a Sunday circulation of 65,904 and average weekly circulation of 41,330 — a modest 1 percent and 4 percent decline from the year before, respectively. But since that paywall was introduced, the Journal’s Sunday circulation has dropped 16 percent to 55,348, according to numbers the Journal reports to the Alliance for Audited Media. Its average weekday circulation dipped another 4 percent to drop below 40,000. The most significant drop came in the first six months after the paywall was introduced.

And it’s a trend: Sunday circulation numbers are 34 percent less than they were at the end of 2006. Weekday circulation dropped 40 percent in that same time.

Ed Atorino, a Gannett analyst for New York-based Benchmark Co., said there are two ways the company has been looking to cut costs. Raising prices is one. “The other option is to review their staff requirements,” Atorino said. “It is a studied move to reduce costs wherever possible to offset the decline in advertising,” the inevitable result of declining circulation.

Atorino could not say whether Gannett plans to cut high-level editorial positions companywide. The Gannett Blog, which is run by a former USA Today reporter and tracks changes in the company, reports that the company has laid off an estimated 280 newspaper staffers, which follows the 2011 massacre, when 700 were let go, including 15 at the LSJ. In 2008-’09, 46 LSJ positions were eliminated. Gannett publishes 82 newspapers nationwide, including USA Today, the State journal, Detroit Free Press, Battle Creek Enquirer, Daily Press & Argus in Livingston County, Observer & Eccentric Newspapers in Livonia, the Port Huron Times Herald, and 12 weeklies in mid-Michigan. 

Elsewhere in the country, at least one publisher and one general manager position are also being eliminated.

Gannett appears more guarded about its staff reductions this time around than it did in 2011. Multiple requests for comment from Priester and Jeremy Gaines, Gannett’s vice president for corporate communications, were not returned. In a Friday Associated Press story, Gaines declined to say where and how many cuts are coming this round. “He said the newspapers are making the cuts to bring their business plans in line with local market conditions,” the AP reported.

Ditching the executive editor position at the LSJ was a localized version of big changes in the industry announced in the past week. The Washington Post — “whose reporting helped topple a president and inspired a generation of journalists,” as The New York Times writes, and was owned by the third generation of the Graham family — is being sold for $250 million to Jeffrey P. Bezos, the founder of Amazon.com. It was reportedly once worth several billion dollars. And The New York Times Co. announced over the weekend that it sold a publication group that includes the Boston Globe for a meager $70 million. The Times reportedly paid $1.1 billion for the Boston Globe alone in 1993.

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