On Day After Tribune Deal: Baltimore Paper Promises Cuts, Allentown Hopes to Hold the Line

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By: E&P Staff

The cuts were coming anyway, the publisher says, but still the news emerged right in the wake of yesterday’s blockbuster announcement of the sale of the parent Tribune Company. In an article today in The Sun of Baltimore, Timothy Ryan, who took over as publisher of The Sun less than two weeks ago, said staff cutbacks would be required in the next month or two.

“He could not say whether the reductions would be made through attrition, buyouts or layoffs,” The Sun reported. “Ryan said the decision to cut staff at The Sun was prompted primarily by a decline in advertising revenue in the first three months of the year and was not the result of yesterday’s sale announcement.”

Meanwhile, another Tribune paper, The Morning Call in Allentown, Pa., recalled that it “has been whittling away at its work force under Tribune ownership. In January 2003, it had 931 workers in Lehigh and Northampton counties. At the beginning of this year, it employed 814 people in those counties, in addition to small bureau operations in Quakertown. Lehighton, Harrisburg and Washington.

“Morning Call Publisher Tim Kennedy said the paper would try to avoid job cuts by continually reviewing and adjusting its resources. He said the new debt would make it even more important that the paper hit its financial goals. ”The amount of leverage leaves less room for error in our operating performance,” he said.”

The Sun article continued as follows.

Donald C. Fry, president and chief executive officer of the Greater Baltimore Committee, said business leaders would watch closely Tribune’s proposed sale and its impact on The Sun.

“I think you always, whenever there is new ownership involved, have to be concerned with whether or not there will be any changes in the composition of management or operations of the newspaper,” Fry said.

Investors in various cities, including Baltimore and Los Angeles, remain interested in buying Tribune’s newspapers. Craig Huber, a Lehman Brothers analyst, estimated that it would cost $517 million to buy The Baltimore Sun Co.

“Our strategy has always been to see who acquires the entire company and try to work with that person to negotiate a sale of The Sun, and that’s what we still intend to do,” said Theodore G. Venetoulis, a publisher and former Baltimore County executive who has been leading a local group interested in buying The Sun.

Some analysts and observers say that despite Zell’s intentions to keep the company in one piece, he might be forced to consider the sale of individual properties to pay down debt….

M. William Salganik, president of the Washington-Baltimore Newspaper Guild and a business reporter at The Sun, lamented the news of the imminent cutbacks, particularly in light of the buyouts of about 70 Sun employees across the company in late 2005.

“Of course, we don’t know the magnitude of the staff reductions they’re talking about, but I don’t think it’s a good business plan to reduce the staff to the point where it hurts the quality of the paper,” he said.

Timothy A. Franklin, the editor of The Sun, said that under the company’s new ownership it is crucial for the paper to retain autonomy in its news coverage.

“You don’t want to see any owner, or anyone else, interfere in the independent, daily newsgathering that we do,” said Franklin, who joined The Sun in 2004. “For our long-term credibility, it’s vital that we remain an independent news operation that doesn’t curry favors or protect sacred cows.

“Sam Zell has said publicly that his interest is economic, and it doesn’t appear to be political or ideological,” Franklin said. “I’m willing to take him at his word.”

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