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Feb. 24, 2016, 1:53 p.m.
Business Models
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Former L.A. Times publisher: Local news orgs need to take advantage of their “unique geography”

Austin Beutner was fired as the Times’ publisher last year after he clashed with its parent company over strategy.

Austin Beutner was named publisher and CEO of the Los Angeles Times on August 11, 2014. That same day, Robin Williams died. The Times, of course, covered the story, and Beutner said Wednesday that the coverage that day garnered “something like six or seven million unique visitors, maybe 10 million pageviews” — a huge haul for the paper.

The Times’ top editors were pleased with the amount of traffic their stories drew, but in a breakfast talk at Harvard’s Shorenstein Center Wednesday morning, Beutner recalled telling the editors that they need to think differently about how they were reaching readers.

“I said, ‘Great story, but let’s have a more sobering conversation and talk about the business implications of this. Ten million pageviews…at a dollar per 1,000 impressions means that this is a $10,000 day. Look around: I think this newsroom costs more than $10,000 per day to operate,'” Beutner said.

“I don’t want to say they were demoralized — hopefully they weren’t — but the point was taken that we need to think differently,” he said. “We need to look at this data. Let’s look at engagement — we might sell that. How many of those actually stayed with us for more than that one click? It turns out very few, so we didn’t have that much to sell.”

Beutner was fired as the Times’ publisher last year after clashing with Jack Griffin, then CEO of the Times’ parent company, Tribune Publishing. Griffin himself was ousted Tuesday in still another shakeup.

Under Griffin’s leadership, Tribune, which owns eight metro newspapers including the leading dailies in Chicago, Baltimore, Orlando, and Hartford, reportedly wanted to focus on a national strategy that would gain operational efficiencies and attract national ad buys. Beutner, meanwhile, wanted to focus more locally on the opportunities in the Southern California market.

“There’s very little commonality across those [markets], and you can’t support some sort of national selling infrastructure,” he said of Tribune’s papers. “Nobody wants to buy a national ad, especially from an organization that covers 7 percent of the country. What we set about doing in Los Angeles was to think about the unique geography of where we were.”

Other newspapers in the area include The San Diego Union-Tribune, the Orange County Register, and Digital First Media’s Los Angeles News Group. Last spring, Tribune bought the Union-Tribune and created the California News Group. “Our strategy was pretty simple: On the print side of the business, scale matters,” Beutner said. The Union-Tribune is now printed at the Times’ printing facility, and Beutner said the deal would let Tribune make a bigger push to advertisers wanting to reach consumers in the region.

Ultimately, he said, the goal was to acquire the Register (with sister paper the Riverside Press-Enterprise) and LANG as well. “We said, if we could combine, the other two would have nowhere else to go over time, so they’ll all be part of the same group,” he said. “So we bought San Diego.”

This month, Tribune secured a $44.4 million investment from Chicago Sun-Times owner Michael Ferro, now the company’s chairman, and Griffin reportedly wanted to use that cash to buy the Orange County Register.

Beutner compared Griffin and other newspaper executives to Chauncey Gardiner, Peter Sellers’ character in the 1979 movie Being There. In the movie, Sellers’ character is a slow-of-mind gardener who, through a series of misunderstandings, finds his thoughts on plant life taken as wise zen koans. By movie’s end, he’s being hailed as a genius and positioned to run for president.

“I think, unfortunately, many in the print newspaper industry are Chauncey Gardiner, where they can mouth the words, but they have no idea what they’re talking about,” he said. “It’s not that they’re not well intentioned people. For what the business was 20 years ago, they might have been perfectly good — maybe even better than good.”

Local news outlets need to own their local markets from an editorial and business perspective to succeed, Beutner said, adding that audience no longer had to be defined by a paper’s print distribution area. In 2014, the paper launched a California section that emphasized local and state coverage. Along with the new section, the paper launched a California-focused email newsletter, and within its first six months, the newsletter had 100,000 subscribers and had become a $2 million product, Beutner said.

He also pointed to the entertainment business, a global industry but one still focused in Los Angeles, as one the Times could use to attract interest from readers around the world. In an interview last year, before Beutner’s firing, S. Mitra Kalita, the Times’ managing editor for editorial strategy, told me the paper wanted its reporting to have a California focus.

“I can think of a number of topics that emanate out of California — race and immigration, health and wellness, technology, environment and coastal management, the drought and the future of water — that are not just national stories, but really pressing global issues,” Kalita said. “I see an opportunity for us in framing those broader stories through the California lens and achieving audience in our state and throughout the world.”

Beyond traditional coverage, Beutner also said Wednesday that the Times needed to look at other ways to leverage its expertise about the Los Angeles area. During his time at the paper, the Times discussed partnering with a Chinese search engine to provide guides to Chinese tourists about the best places to shop in L.A., or even where they should look if they’re interested in buying a home in the city. (Other local outlets have launched similar products.) Beutner said the Times could’ve struck deals with residential brokerage companies, earning the paper a fee for each customer it drives their way.

“All of a sudden you’re remaking your business for the digital age, and you’re not just trying to reach that same physical base of customers,” he said.

Photo of the Los Angeles Times building by Jeremiah Tran used under a Creative Commons license.

POSTED     Feb. 24, 2016, 1:53 p.m.
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