Published Tuesday, April 3, 2001
Kalb Report addresses profit-vs.-quality
BY MARY VUONG and ICESS FERNANDEZ
ASNE Reporter
Editors wrestled with the challenges of meeting the public’s expectations of news quality and Wall Street’s demand for high profits Monday at a forum led by veteran journalist Marvin Kalb.
The discussion was prompted by the national media’s outcry after the publisher of the San Jose Mercury News resigned last month in a dispute with parent company Knight Ridder Inc. over how to produce higher profits during an economic downturn.
Mr. Kalb jokingly dubbed the panel “What do we do now that Jay Harris has quit?”
Although the editors didn’t have an answer, they were still hopeful that a balance could be obtained.
“What’s good is that it may put the brakes on some over-exuberance in cutbacks,” said Gregory L. Moore, managing editor of The Boston Globe.
The origin of the problem is one created by the newspaper industry itself, said Gil Thelen, executive editor of the Tampa (Fla.) Tribune.
“Thirty to 40 years ago a group of newspaper owners made a pact with the devil” when they turned over control of their privately owned publications to investors. Now newspapers are struggling with how to balance investor-driven profit margins with high-quality journalism, Mr. Thelen said.
Before a gathering of about 100 people and a national TV audience on C-SPAN, Mr. Thelen and four other newspaper editors took part in “The Kalb Report: Credibility and Leadership in Newspaper Newsrooms” at the National Press Club. The forum was partly sponsored by the Shorenstein Center on Press, Politics, and Public Policy at Harvard University, where Mr. Kalb is the executive director.
Maintaining the quality of newspapers requires an understanding of the long-term goal of serving readers, said Jennie Buckner, editor of The Charlotte (N.C) Observer. Editors must know when to “tighten up,” but also when to tell owners, stockholders and Wall Street that cutbacks will damage the newspaper’s quality.
Last year, the Mercury News had an 18.5 percent profit margin, compared with 22 percent to 29 percent in recent years, Mr. Kalb said. Knight Ridder’s goal this year was a profit margin of about 22.7 percent, in a down market, an increase of about four percentage points.
The newspaper has been especially hard hit because of its Silicon Valley location, the heart of the fledgling dot-com industry.
“Wall Street is there pushing, pushing, pushing. We have to make our case as compelling as the analysts’,” Ms. Buckner said, stressing that editors need to explain to investors why newspapers must devote money to special projects and investigative reporting. It is also crucial for business and editorial staff to work together, she said.
The panelists debated whether newspaper companies or financial analysts are responsible for the rising pressure to increase profit margins each year.
Mr. Moore said the companies are the ones that set goals for themselves, but Mr. Thelen argued that Wall Street sets them.
The panel also discussed newspaper credibility and how to balance the bottom line without sacrificing quality journalism. In poll after poll, public trust in newspapers has decreased, Mr. Kalb said, specifically recalling one in which the public would not vote for the ratification of the First Amendment in today’s world.
Mr. Moore blames the loss of credibility on the explosion of outlets passing as news sources. “There is an amalgam of all kinds of informational sources like ‘The Drudge Report.’ ‘Inside Edition’ is treated like ‘Nightline.’ ”
Journalists have not done a very good job reacting to the proliferation of so many sources, Mr. Moore said.
Solving the credibility problem comes down to fixing errors in every part of the paper, Ms. Buckner said. The Charlotte Observer tracked their mistakes and found most were in photo captions.
“I don’t know if we’re more accurate, but we are on the road to being more credible,” she said.
Easy access to the Web and the increased sources of information have played a role in how the public receives news.
“The nature of the job has changed,” Mr. Thelen said. “Our place of being first responder has changed.”
Today’s news topics are also more complicated. “When we broke into journalism, the mantra was get both sides of the story,” said Peter Bhatia, executive editor of The Oregonian. “The problem now is there are multiple sides to a story.”
Despite the concerns in the industry, all the editors said the quality of journalism is the highest it’s ever been.
“I admire Jay for holding to his personal convictions and I hope he doesn’t lose faith in the industry,” said Karla Garrett Harshaw, editor of the Springfield (Ohio) News-Sun.
Still, the panelists did not resolve the profit-vs.-quality question.
“The owners have to say ‘Yes, there’s a balance that must be struck here.’ The pressures from Wall Street are greater than ever. We won’t be able to do everything Wall Street wants,” Ms. Buckner said.
