Cuts at the profitable Houston Chronicle — the most financially successful newspaper in the country starting to feel the pressure.

Mick Gregory

Hearst’s Houston Chronicle is the flagship of the media empire, supporting the poorly managed, San Francisco Chronicle which is losing a million dollars a week.

It’s Houston’s mega newspaper where Sunday papers still weigh about 5 pounds.

This info is from a citizen jounalist with the nick name Banjo.Jones.  

We’ve received more information regarding the 5 percent personnel cutbacks at the Houston Chronicle, the only daily newspaper in the country’s fourth largest city.

In addition to the names we posted yesterday, the additional buyouts/layoffs include:

Andrew Guy (features), Judy Minshew (editorial), Valarie White (business secretary), Bruce Westbrook (features) and Patty Reinert in Washington, we’re told.

Good luck to all.

We’ll say again, it’s a damn shame that a paper that’s among the USA’s top 10 in circulation and which holds a monopoly in a city the size of Houston takes such drastic measures to protect its profit margin, which we suspect remains quite healthy in comparison with other non-media private sector endeavors.

In case you missed it, Perry Dorrell (aka P.Diddie) explained it all in reaction to one of our earlier posts.

Here’s what he said:

You worked in the bizness, Banjo, so you know why this happens. I used to work for a handful of Hearst newspapers, on the ad side, between 1981 and 1992.

The profit margin of an urban daily like the Chronic probably still averages something around 20-25%. As circulation and subsequently advertising continue to erode, expenses have to be reduced in order to sustain that margin. Newspapers don’t cut staff to stay in business; they cut staff to maintain the highest profit margins for any business you can think of. Smaller “community” newspapers run higher margins; the Plainview Daily Herald ran 30% in 1987 and Hearst budgeted 33% in 1988. When the Beaumont Enterprise was sold to Hearst in 1984, the publisher at the time — who was also the president of Jefferson-Pilot Publications, the seller — bragged to the Hearst guys that he was running that newspaper at a 40% profit margin.

“A position-elimination program” is the only way left to Sweeney and his brethren at newspapers large and small, all across the nation, to preserve their bonuses and ultimately their own jobs.

Sometimes I get the feeling that the printed newspaper as we all know it will be read only in a museum by the next generation. As a kid, I grew up sitting on my dad’s lap reading the funnies with him. When I was a teenager he would announce, as I ambled into the kitchen in the morning: “the Astros won last night”. That just doesn’t happen any more. Kids get what little news they care about anyplace except from the newspaper. They’re too busy texting to get ink on their fingers.

And I have no idea who’s willing or capable of absorbing the cost of gathering news in the future. Those profit margins provided all the staffers to work city hall, the courthouse, the football games and so on. Newspapers have been paying that freight — to go out and get the news and then get it to us — for well over a hundred years. But they don’t want to do it any more.

That’s where the breakdown will be — make that, ‘is’. The one between the truth and the spin. If nobody wants to pay to collect the news, and everybody just prints or posts the press release, and something like net neutrality stifles the blogosphere …

We can all whine about bias and lack of coverage and cutbacks, but when the newspaper business finally quits or goes under, there’s precious little in terms of infrastructure in the news business to fill the void.
Posted by Banjo Jones at 8:34 AM

Anonymous said…
After being a subscriber of The Houston Chronicle for over 30 years, I ended that several years ago. The newspaper does have a monopoly in Houston and promotes an open border agenda at every turn, ignoring national news often and replacing it with “editorials” and articles that appear to be written by high school journalism students promoting their agenda. The Chronicle is a more of a “rag” and less of a newspaper.

3:34 PM
Anonymous said…
I interviewed at the Houston Chronicle about three years ago and got an in-depth look at the organization over two days.

What a mess. I do not know how on Earth they make a profit as it is — given the OVERSTAFFING they have already.

There were managers, reporting to managers reporting to managers. It made the government look efficient.

And, no, they did not offer me a job. But, I look at that as a good thing and an example of their stupidity.

I’ve since gone on to make twice as much yearly as I was interviewing for there — and have a real executive job (not some made up crap that they were advertising for).

If everyone there worked on a daily basis there wouldnt be too many problems.. But, idle hands….

They need to get rid of the “thinkers” in their place and keep those who do real work… or they are doomed…

Here is a memo from a Chronicle editor:

Houston Chronicle editor Jeff Cohen’s memo to staff

October 30, 2007

Newsroom restructuring

I believe that journalism is a public service. But, also, it is a business. And as a business, this newspaper is not immune from market forces in a media world that has exploded with new voices and commercial options.

Market forces require the Chronicle to operate with reduced costs. All of you received this month’s memo from the publisher framing a downsizing. To achieve that, this week we begin to roll out a restructuring in the newsroom. This process has neither been easy or undertaken lightly.

We will go forward with fewer journalists and support staff. We need to thank those who are leaving. They have played a role in building the Houston Chronicle into a strong regional newspaper and superb Web site. Our reporting today is more aggressive, our writing is more engaging and our newspaper is more visually alluring because of them and you.

How are we going to do all these things with less staff? It is a logical question in light of the sheer volume of material we publish each day in print and online.

Remember, we will continue to have the largest news operation on the Gulf Coast and probably twice as many journalists as all other Houston news media outlets combined. Remember also that our competitors today operate with lean, agile staffs. Competition, as we all know, comes from every direction – to see it you only have to walk by the racks of free publications on the street corner or do a Google search on any topic that we cover. We, however, will remain bigger, more talented and more creative than all comers.

4 thoughts on “Cuts at the profitable Houston Chronicle — the most financially successful newspaper in the country starting to feel the pressure.

  1. The above item as it pertains to (xxxxxxxxx ) is erroneous.

    I was with Hearst too. They have good managers and owners, but also some very bad managers. It’s sad to see the domino effect caused by the unprofessional editors, with no business management education.

  2. mick,
    i’m the guy whose blog you quoted here and i was wrong about (xxxxxxxxxxxx) suing the paper, according to (xxxxxxxxx), so you need to redact his name off your report.

    Just did. Thanks for reporting the truth, Banjo.Jones.

  3. I was a senior manager of 10 years at the time of this article and can definitely support the message in this story. Margins over people, revenue above loyalty, I was one of the many heads left on the guillotine,,,, Today’s news of additional cuts led me to this post… RIP

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