November 26, 2008

Mayor praises effort to save newspapers

Note send this morning from Mayor Art Ward to state lawmakers trying to help the Press and 12 other Central Connecticut papers stay in business:
As Mayor of the City of Bristol, home of the Bristol Press, I want to extend our gratitude to you and the New Britain legislative delegation for pro-actively pursuing a potential means of retention of both the Bristol Press and the New Britain Herald.
This office has also been in contact with the office of Congressman John Larson with regard to this issue and is committed to assisting you in resolving this matter in the best interests of the media and the cities of Bristol and New Britain.
*******
Copyright 2008. All rights reserved.
Contact Steve Collins at scollins@bristolpress.com

27 comments:

Bob Jelenic said...

This is like "You've Got Mail," the film with Tom Hanks and Meg Ryan. Meg tries to secure, and briefly gets, community support and VIP locals to rally around her efforts to save "The Shop Around The Corner," a well-known and beloved bookstore that is being forced to close for financial reasons. The efforts to save these newspapers will be brief, sadly. Gov't has no role to play in this event. Newspapers are privately owned and operated. JRC can no longer afford to operate these newspapers, and clearly there is no other person or group who wants to take on the burden of rebuilding small-town newspapers with weak circulation and very little ad potential. This is not like a gov't bailout, where the papers could be kept alive until the economy gets better. JRC and its papers were crumbling long before the economy was. "The Shop Around The Corner" eventually closed, and people went on with their lives. The same will happen in these towns. Many communities, some larger than these two, no longer have daily newspapers specific to their towns or cities, but instead utilize the nearest bigger-city newspaper.

I'm really getting tired of hearing about how the closure of these newspapers is an arrow through the heart of the constitution and freedom of the press. How so? These papers aren't being shut because of censorship laws. Anyone is free to purchase these newspapers and run them while enjoying the freedoms granted by the constitution. Anyone is free to start a new newspaper and run it while enjoying the freedoms granted by the constitution. Freedom of the press is alive and well in Connecticut (except for this blog, of course) and all states.

Steve Collins said...

BJ - Nobody's making you read any of this so complaining about how you are "really getting tired" of hearing about the paper's potential closure is kind of nuts. If you don't care, don't read about it.
For me, and for most of the people in Bristol who care about news, there is no bigger story now than the looming closure of the paper.
Surely you recognize that we cover the hell out of every big story in Bristol -- from proposed new schools to mayoral elections -- and we'd have to be complete morons to ignore this one, since all the others fall by the wayside forever if the outcome is anything other than a revived Bristol Press.

Steve Collins said...

By the way, that little bookstore in "You've Got Mail" may have died, to the chagrin of book lovers, but at least there was a big store nearby selling books. If this little paper goes under, there won't be any more Bristol news. There is no big paper down the block that will fill the gap. If the Press folds, there is nothing ahead but the dark chasm of eternal ignorance about local news.

Anonymous said...

You tell him, Steve!

Bob Jelenic said...

Steve, the desperate state you are in has enabled you to completely misread what I wrote and pick and choose only what you want to see. I certainly didn't say I was "tired" of hearing about the newspapers' closures. I dare you to find where I said that. I said I was "tired" of hearing how their closures were somehow a measure to hurt the constitution and freedom of the press. Re-read to see for yourself. I'm equally "tired" of you whining about it. Obviously, the closure of the newspapers is and should be big news in these communities. Not once did I say this should this not be reported on.

You're also missing the point about "The Shop Around The Corner." Your newspaper is that little store. It, too, will soon be closed. Those people could still buy books, at a bigger store, and people in your community will still be able to buy a newspaper or have it delivered to their house. The concrete structure of a newspaper office won't be located in your community, but newspapers will still be there. No, you will no longer have news and features and sports devoted just to your community. There are hundreds or thousands of communities who do not have daily newspapers and they survive and function fine in their daily lives. Do a Google search for towns and cities in America with populations equal or greater than your community's and see how many of them have daily newspapers. Would they like to have them? Presumably so, but it is not financially feasible these days.

Is this sad for Bristol and New Britain? Of course. It will be a big change and not one that most will enjoy. It is one that you will have to accept, though.

Steve Collins said...

I don't believe that a town without a newspaper functions fine.
Losing a paper doesn't put an arrow through the Constitution or freedom of the press as a concept. It just leaves democracy without the information it needs to function rationally. Operating in the dark, government can do what it likes and, just as bad, even well-meaning officials have far less opportunity to know what's needed without a paper to help give a voice to the people.
Am I desperate? No. A better word would be determined, determined to do everything possible to keep alive an institution that doesn't deserve to die.

Don Quixote said...

Why doesn't the "Mayor" spend some time trying to save Bristol????

A more viable Bristol will help ALL entities.

Ditto said...

and if ward wasn't trying to assist, you would be asking "why isn't ward helping" - what a bunch of real losers who probably can't read anyhow.

Anonymous said...

He certainly ain't helping Bristol.

That is what I am conveying.

Ditto said...

2:46 - you might be right because if ward was really helping bristol, you would be on a moving van, outta here.

Anonymous said...

I may be, without him even knowing about it.

And I don't think I'll be alone.

Nor first.

Anonymous said...

Well 3:58, if whining and negativity is all you have to contribute, Bristol will be much better off without you....

Anonymous said...

"Freedom of the press is alive and well in Connecticut (except for this blog, of course) and all states."

How can you say you are less free on this blog than in a newspaper? If you wrote 100 letters to the editor you might get one published, and more than likely it would be edited for length and probably diluted in meaning. Here you can state your opinion AND follow up when you feel you are misunderstood. You proved that point yourself with your previous two posts. Disagree all you want with Mr. Collins, but I think you owe him an apology for the above statement. Doubtful you would have gotten either of your posts published in the Press.

Anonymous said...

Anonymous 7:28: I've read BJ's posts and he didn't say that he was less free in this blog than in a newspaper. He said nothing about having his comments posted in a newspaper. You owe him an apology for false accusations. Steve never should have said he was going to kill comments he didn't like and this wouldn't have become an issue. Either way, it is silly that of all the things being talked about here that you are concerned with 6 words that appeared inside parentheses.

Anonymous said...

To anonymous 8:53:

"Anonymous 7:28: I've read BJ's posts and he didn't say that he was less free in this blog than in a newspaper."

Here is the direct quote from Bob.

"Freedom of the press is alive and well in Connecticut (except for this blog, of course)"

I stand by my statements. You may apologize also, if you have character enough to swallow your pride.

Anonymous said...

"Either way, it is silly that of all the things being talked about here that you are concerned with 6 words that appeared inside parentheses."

Those weren't silly words, they were simply untrue. All news is edited for content accuracy and relevance, not personal preference. That is not denying anyone's freedom. "Freedom of the press" implies newspapers, including the Bristol Press. BJ should apologize.

concerned conservative said...

I like Jelenic's comments. He owes no one an apology for them.

Anonymous said...

Isn't Jelenic dead yet? I mean, hurry up, willya? Or at least shut up.
He never cared about Bristol when he was calling the shots at the Press as president of the Journal Register Co. and he certainly doesn't care about it now.
Apparently he has plenty of dough to just sit around reading blogs that don't interest him (or so he says) and trashing other people and Bristol's hometown paper.
He's a complete jerk.

Poboy said...

Here is an interesting article I found at a website called Funding Universre.com. It clearly shows how a poor business plan and incompetent management by Jelenic and others, is systematically destroying a host of small town newspapers. Virtually all of these small papers had healthy subscriber bases and decent ad revenue, indeed they were cherry picked. The business was over leveraged from the start. With the focus on maximum profits rather than quality of product, the papers suffered. Jelenic made out pretty well as is demonstrated by this paragraph :

“ For 1997 JRC reported combined revenues of $359.4 million. Net income FELL to $23.0 million as a result of a one-time pretax charge of $31.9 million related to management bonuses and incentive plans in connection with the IPO. For 1997 Jelenic received $11 million in executive compensation, including a one-time $10.5 million bonus and a salary of $825,000. It was nearly NINE TIMES more than the $1.35 million he earned in 1997. In 1996 he received about $1 million in salary and bonus, comparable with salaries of some of the newspaper industry's biggest players. “

Here is the full article:

“Company History:
The Journal Register Company (JRC) owns and operates 24 daily newspapers and 185 nondaily publications in seven geographic areas: Connecticut, Philadelphia, Ohio, St. Louis, central New England, and the Capital-Saratoga and Mid-Hudson, New York, regions. Its flagship newspaper is the New Haven Register, first published in Connecticut in 1755. Between 1993 and 1998 JRC completed 13 strategic acquisitions that involved 12 daily newspapers, 117 nondaily publications, and three commercial printing companies. The company followed a strategy of increasing the cash flow and profitability of the newspapers it acquired. More than half of the company's daily newspapers have been published for more than 100 years. Its acquisitions were guided by a geographic cluster strategy, which enabled JRC to become the number-one provider of local news and sports and advertising in the majority of markets it served. Geographic clustering was a key element of a strategy that had four major points: to expand advertising revenues and leadership, grow by acquisition, capture synergies from geographic clustering, and implement consistent operating policies and standards in its acquired properties. As a result of the high levels of debt incurred by its predecessor corporation, Ingersoll Publications Co., in the 1980s, approximately three-fourths of the common shares of the JRC are controlled by the investment firm E.M. Warburg, Pincus & Co.

Background and Early History: 1980s

The Journal Register Company was established in 1990 from the remnants of Ralph Ingersoll II's collapsed newspaper empire. During the 1980s Ingersoll had assembled a family of newspapers through his company, Ingersoll Publications Co., using high-risk junk bonds to finance his acquisitions. He overpaid for some papers and amassed a large amount of debt. When the stock market experienced a severe downturn in 1987, the 1980s way of financing acquisitions came to an end. One of Ingersoll's last acquisitions was the historic New Haven Register of New Haven, Connecticut, which had been published since 1755.

In July 1990 investment firm E.M. Warburg, Pincus & Co., which was Ingersoll's partner and financier, bought him out of the U.S. newspaper market, with Ingersoll gaining ownership of Warburg, Pincus's European newspaper properties. Robert Jelenic, who was president of the U.S. newspaper companies at Ingersoll Publications, became CEO of the newly incorporated Journal Register Company. After JRC went public in 1997, Warburg, Pincus remained a majority shareholder with a 72 percent ownership interest.

Acquisitions Guided by Geographic Clustering Strategy in the 1990s

When the JRC was formed in 1990, it already owned newspapers in Philadelphia, Ohio, St. Louis, central New England, and the Capital-Saratoga region of New York, in addition to the New Haven Register. For the next decade JRC would acquire more publications in those regions as part of its geographic clustering strategy, through which the company hoped to enjoy operating synergies.

In 1993 JRC took over the Times Herald of Norristown, Pennsylvania, a western Philadelphia suburb, adding to its stable of four daily and nine weekly newspapers in the Philadelphia region. The Times Herald was a historic newspaper that was founded in June 1799 as the Norristown Gazette. Six months later it published George Washington's obituary.

The JRC immediately reduced the Times Herald's sales and marketing staff by about 25 or 30 people. Responding to charges that the JRC "ran roughshod over the staff," Jelenic said, "In our opinion the Times Herald was overstaffed." He asserted that each JRC acquisition is evaluated on a case-by-case basis and that JRC did not have a policy of reducing staff in every case. In any event, the Philadelphia Newspaper Guild staged a one-day strike in September 1993 to protest cuts in jobs, benefits, and pay that were imposed by the JRC. Although its acquisition agreement did not require it to do so, the JRC agreed to negotiate with the union.

Additional newspapers were acquired in Connecticut in 1993 and 1994, including the dailies Torrington Register Citizen and the Bristol Press, along with Thomaston Express. For 1994 JRC reported net income of $20.7 million on combined revenues of $300.2 million. For the next five years the company's revenues and net income would grow steadily, except for 1997 when it incurred a one-time charge related to its initial public offering (IPO), which reduced net income from the previous year.

JRC's largest acquisition in 1995 involved 42 nondaily publications in Connecticut and Rhode Island and one commercial printing plant in Connecticut, which was acquired from Capital Cities/ABC Inc. for $31 million. JRC also paid $11 million for the Herald of New Britain, Connecticut and $5.5 million for the Middletown (Ct.) Press in separate transactions. For 1995 JRC reported net income of $26.8 million on combined revenues of $339.0 million. The company's total debt was $689.3 million, compared with $306 million in assets, and interest and other nonoperating expenses were a record $64 million.

In 1996 JRC paid $18 million for the Taunton (Mass.) Daily Gazette. By the end of 1996 JRC's debt level was still at $655 million. Revenues were up to $351 million, and net income rose to $28.1 million.

Initial Public Offering in 1997 Set Stage for Aggressive Acquisitions Program

On May 8, 1997, the company's common stock began trading on the New York Stock Exchange for $14 a share. The IPO raised $130 million, which would be used mainly for acquisitions. Jelenic was quoted as saying, "We went public so we could acquire. That was the main reason." Of the $130 million, about $34.5 million was used to repay obligations to Warburg, Pincus. At the time it went public, JRC owned and operated 18 daily newspapers and 118 nondaily publications in five geographic regions: Connecticut, Ohio, Philadelphia, St. Louis, and central New England.

In December 1997 JRC announced three major acquisitions. It added to its St. Louis cluster with the purchase of the Ladue News of Ladue, Missouri, which served the suburbs of St. Louis. JRC also expanded its presence in Philadelphia by acquiring the Intercounty Newspaper Group for $12.8 million. The acquisition included 17 weekly newspapers published in the Philadelphia, central New Jersey, and south New Jersey regions. Also included in the sale were two printing plants located in State College and Bristol, Pennsylvania. A third acquisition involved HVM LLC of New Milford, Connecticut, for $3.8 million. The acquisition added another eight weekly newspapers, two shoppers, and three monthly magazines.

For 1997 JRC reported combined revenues of $359.4 million. Net income fell to $23.0 million as a result of a one-time pretax charge of $31.9 million related to management bonuses and incentive plans in connection with the IPO. For 1997 Jelenic received $11 million in executive compensation, including a one-time $10.5 million bonus and a salary of $825,000. It was nearly nine times more than the $1.35 million he earned in 1997. In 1996 he received about $1 million in salary and bonus, comparable with salaries of some of the newspaper industry's biggest players.

The Future of Journal Register Company: Will the Size of Acquisitions Keep Growing?

In its biggest acquisition to date, JRC acquired five daily newspapers, including the Delaware County Daily Times, and 20 nondaily publications in Pennsylvania, New York, and Ohio for $300 million in cash from the Goodson Newspaper Group of Lawrenceville, New Jersey. The acquisition resulted in JRC having a combined circulation of more than 197,000 daily and 600,000 Sunday publications in suburban Philadelphia.

The price of the acquisition was estimated to be 14 times the newspapers' 1997 cash flow, a substantial premium considering recent newspaper deals were accomplished at ten to 12 times cash flow. Jelenic predicted, however, that the acquisition cost would be less than 11 times 1999 cash flow after the company improved the newspapers' cash flow and cut expenses by integrating them into JRC's clusters.

At the same time JRC started a new geographic cluster around Kingston, New York, with the acquisition of Taconic Media in Dutchess County, New York. Taconic owned seven weeklies with a combined circulation of 321,600 in Dutchess County.

As a result of the Goodson acquisition, combined revenues rose significantly in 1998 to $426.8 million. Net income nearly doubled to $41.1 million, but JRC's debt level ROSE to $765 million. Operating as a pubic company since 1997, JRC's management and strategy seem firmly in place to guide the company toward future growth and increased profitability, as long as its combined revenues allow it to service its relatively high level of debt. “

This article is several years old. However, with JRC shares worth one cent each at present, I would say things didn’t work out so well (except for Mr. Jelenic)

Anonymous said...

The implementation of JRC’s business model contributed directly to the demise of the Bristol Press. Here are a couple of examples:

Change in delivery time. The press was an afternoon paper. With a later deadline, more up to date local information was available on a daily basis. Also, it was easier to a get local delivery force (kids) to deliver the paper after school. Going to all morning publications simplified operations at JRC but it diminished the quality of the paper. Even the way JRC implemented this plan turned readers off. Even though home deliveries were done the afternoon, the paper was available in pay boxes and news stands in the morning. Eventually, papers were required to be delivered in the morning, which made it much more difficult to find carriers.

Seven days a week. This was done purely for the ad revenue. The “Herald Press” was never a local paper, just a low quality wrapper for retail ads. Also, the addition of a bulky Sunday edition made it even more difficult to find carriers. As a result, papers are delivered by adults, and the whole delivery and collection system is done by subcontractor, an inefficient and revenue eating system.

Poor marketing. Telemarketers hired by JRC badger residents with discount subscription offers. The bulk of these subscriptions are short lived, wasting valuable resources that could be used to improve the quality of the publication rather than artificially inflate subscription numbers. In a local market there are only a certain number of customers. That means you increase customer base by continually improving your product, not by trying to convince more people to by the same old crap.

Bottom line is this scheme was doomed to fail. The Bristol Press was a money making newspaper when JRC aquired it, indeed that is why they bought it in the first place. Hopefully someone can breathe new life into it.

Poboy said...

"Newspapers are privately owned and operated. JRC can no longer afford to operate these newspapers, and clearly there is no other person or group who wants to take on the burden of rebuilding small-town newspapers with weak circulation and very little ad potential."

When JRC bought these publications they were high quality businesses with strong subscription rates and good local ad revenue. Jelenic's business plan decimated them, IMHO. Maybe after the JRC goes belly up he will take some of the millions he sucked out of these once proud enterprises and reinvest.

Poboy said...

Here is a link to another interesting aricle about Mr. Jelenic.

http://www.citypaper.net/articles/050699/news.on.media.update.shtml

Poboy said...

http://www.citypaper.net/articles/050699/news.on.media.update.shtml

Try the link above to the Jelenic article.
Interesting .

Poboy said...

http://www.citypaper.nwww.citypaper.net/articles/121798/coverstory.shtml

If you think the other article was good, check out this one!

Poboy said...

http://epaper.pottsmerc.com/edition-mrc/

Could this be the future of The Bristol Press? Pottstown Mercury is owned by JRC.

Poboy said...

http://epaper.nhregister.com/NHR/Privacypolicy.html

Here is another Journal Register e product.

Poboy said...

http://epaper.dailytribune.com/edition-oak/

This one has a free sample of a complete online newspaper.