NIEMAN HEAD WARNS ABOUT PROFIT MARGINS

By: Bill Kirtz Giles Says Newspaper Execs Should Educate Wall Street


BOSTON - Newspapers may be undermined by "market pressures
and the continuing high level of profit margins," Nieman
Foundation curator Robert Giles warned the New England Newspaper
Association Thursday. Giles took over the Harvard fellowship
program last August after serving as senior vice president of the
Freedom Forum and publisher of The Detroit News.

He said the recent resignation of San Jose Mercury News
publisher Jay Harris to protest newsroom cuts should spark
editors to "engage the public in a dialogue about the importance
of a free and profitable press.

"We're still a business, and markets rule," he said, but
newspaper executives should "educate Wall Street" to expect
annual 10% to 15% profits instead of the more than 20% industry
norm.

"There's a conflict between the marketplace and journalism's
obligation to the First Amendment - protected public trust,"
he said. Too often, high profits are achieved "at the cost of
quality journalism." Giles said good newspapers are worth the
investment. "Shareholders are interested in quality, whether the
business is newspapers, cars, or electronic devices," he added.

Giles encouraged editors to "talk and write, very publicly, about
the core values of newspaper journalism and why newspapers are a
public trust - to explain very publicly why the newspaper
business is different from other businesses." He also said news
executives should be more open with their staffs about "the
nature of the business, the numbers that drive the industry."

The newspaper and newsprint industries should work to flatten out
paper price swings, so that the news hole needn't be cut in
response to a quick rise in newsprint prices, Giles said.

He praised the Committee of Concerned Journalists, the Freedom
Forum project on fairness, and the forthcoming American Society
of Newspaper Editors' credibility handbook as examples of a
serious industry effort to build greater trust among readers.
Condemning "the lack of penetrating, probing questions to hold
public officials accountable," Giles said the Nieman Foundation's
"Watchdog Project" will hold a conference next fall on ways to
fight government secrecy and may create a training tape for
newsroom and journalism schools' use.



Bill Kirtz (kirtzcb@hotmail.com) teaches journalism at Northeastern University in Boston.



Copyright 2001, Editor & Publisher.