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Denver Newspaper Agency seeks $35 million of cuts

Larger cost savings sought from operations, management

By Jeff Smith, Rocky Mountain News (Contact)

Published February 11, 2009 at 5:44 p.m.

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The Denver Newspaper Agency seeks to cut about $35 million of expenses, double what had been reported previously, according to people familiar with the situation.

Earlier reports focused on a request for $18 million of concessions from union employees. But agency management has a larger cost-savings goal, which would come from operations and management concessions, the sources said.

Agency spokesman Jim Nolan said Wednesday that he wasn't in the position to confirm or deny any numbers.

"The DNA consistently has not discussed its finances in public - only in very rare circumstances," he said.

The agency handles the business and advertising operations of The Denver Post and Rocky Mountain News. It is owned jointly by MediaNews, The Post's owner, and E.W. Scripps, the Rocky's owner.

Union-concession talks initially were requested by Denver Post publisher and MediaNews CEO Dean Singleton in December, days after Scripps put the Rocky up for sale, saying that it wanted to leave the Denver market.

Scripps has been mum on whether there are any prospective buyers for the paper.

Singleton, through a MediaNews official, initially said this week that the $18 million goal for union concessions hadn't changed and that he didn't know where the $35 million figure came from.

On Wednesday, through an assistant, Singleton said he couldn't speak for the agency.

The agency originally had set a deadline of Jan. 16 to obtain the concessions from its unions, saying that it needed them in its efforts to renegotiate $130 million of bank debt.

But talks between agency management and five of the agency's six unions are ongoing without a new deadline.

A number of cost-savings ideas have been discussed during negotiations, including outsourcing, but union officials have long been opposed to that.

Separately, Singleton in December requested $2 million of concessions from The Post's union employees.

The Post's management and union employees are negotiating a new labor contract that would include pay cuts, unpaid furloughs and benefit reductions, according to a joint bargaining note to union members this week.

The note said that Post management had agreed to take pay and benefit cuts equal to those taken by union employees.

Comments

  • February 11, 2009

    7:42 p.m.

    Suggest removal

    DakotaPlainsman writes:

    Another union-dominated industry is in trouble. Anybody willing to admit there might be a common thread between so many of the failed industries in our country.

  • February 11, 2009

    8:28 p.m.

    Suggest removal

    bobdylanindenver writes:

    The Rocky and the Denver Post aren't producing objective reports anylonger. They hire reporters that have clear agendas, and place their own politics above their professional ethics.

    It's clear even in the postings on this web site that the Rocky is super liberal. They allow for raving liberal rants, yet block and remove comments that don't support their agendas.

    That is why they're oosing market share, they are simply part of the roblem, not the solution.

    If I had to choose one paper over the other, I would like to see the Rocky stay, only because it was the first paper in the area. Byers was a great man, it's sad to see his life's work hijacked by psedu-journalists that are on polar sides of Byers.

    Byers was a man, these people that run the paper now are far from that.

  • February 11, 2009

    8:44 p.m.

    Suggest removal

    AC writes:

    Wow, you're delusional. Today's journalists are squeaky clean non-biased reporters compared to the civic boosterism of William Byers in his day. Heck, the News at one point was *owned* by one of Colorado's US senators who was a Democrat.

    Today, the News like most papers is Republican-leaning.

    And Dakota, it isn't the unions, it's the mismanagement at top in not navigating the business through the revolutionary changes in the business model that have bled revenue particularly from the once-fat classified ad sections. Nothing more than that. Workers making a living wage are NOT the problem.

  • February 11, 2009

    8:47 p.m.

    Suggest removal

    localyokal writes:

    Yep--I agree with both comments

  • February 11, 2009

    10:04 p.m.

    Suggest removal

    Oh_Wise_One writes:

    AC- either you are delusional yourself or you are adept at sarcasm. "non-biased" and "republican leaning" are the funniest thing I read all day.

  • February 12, 2009

    4:15 a.m.

    Suggest removal

    LOUIE writes:

    Some major papers only print on certain days, with their online edition being constantly updated. Detroit Freepress I believe is operated this way. If printing were cut to 3 days a week with a Sunday edition full of coupons and advertising, the Rocky might be able to survive, The JOA would have to end as revenue sharing will be a direct casualty. Advertising revenues and rates could then be competively adjusted lower than the Post, as well if union concessions were also realized. But there is enough of a consumer base for the Rocky to run in this format as long as it wasn't affilated with the Post in a JOA.

  • February 12, 2009

    5:05 a.m.

    Suggest removal

    gbird writes:

    As a publisher, the problem with newspaper is the newsprint. Severe expenses in paper will kill all papers. The newspaper industry can't make money on the internet and as long as they publish on line for free they kill their own goose. Printing every other day won't cut expenses, the public will go online.
    Advertising is the key and only corp giants can afford the rate and they don't pay.

  • February 12, 2009

    7:54 a.m.

    Suggest removal

    AC writes:

    Oh_Wise_One writes: "AC- either you are delusional yourself or you are adept at sarcasm. "non-biased" and "republican leaning" are the funniest thing I read all day."

    That's because YOU are looking for bias in your reporting, sport. You're clueless. I don't want bias in my reporting. You want it to lean your way. This is local news, I want it straight. The RMN has long been known as a Republican leaning newspaper in its opinions. The Post leans Democrat. That's just a fact.

  • February 12, 2009

    7:55 a.m.

    Suggest removal

    theguyoverthere writes:

    If anything get rid of the Denver Post. It is a crappy newspaper. The Rocky Mountain News is way better.

  • February 12, 2009

    7:58 a.m.

    Suggest removal

    Logical writes:

    AC - most papers lean way to the left, both on their editorial pages, and in their "reporting". That is a fact acknowledged by most people who work at papers (in contrast to "official" statements by the papers, which always deny any bias).

    Why do you think management can't navigate the new business environment? Unions don't allow for swift changes to utilize new technology. Mechanization is fought tooth-and-nail, because it eliminates jobs (which allows a company to survive longer).

    Unions most-certainly are a huge reason many newspapers are failing. When you are strapped to old, cost-intensive ways of doing things, you cannot compete with more-nimble business models. No problem with workers making living wages, but when you are carrying too many workers, the business can't make a "living profit", and goes out of business. Then, no one has a job. How smart is that???

  • February 12, 2009

    9:55 a.m.

    Suggest removal

    nbw9597 writes:

    Open Question to RMN / DNA:

    I pay for home delivery of the RMN, but never read the paper at home. However, my wife does.

    I read all of my news online as I am sure many other people do these days.

    The Wall Street Journal online allows readers to only read an extract of an article. If they want access to the full article they have to have a subcription (delivered paper, or online only).

    I would cancel home delivery altogether if my wife didn't read the paper. Why should I pay for something that I can get for free?

    Have you ever considered changing your business model to move in a similar direction (small charge for full access to articles) with the RMN and Denver Post websites?

    That said, I don't want to pay any additional money to read my news online since I already subscribe to the RMN. However, how many people read the news on your site and/or the Post that do not pay for home delivery where you are capturing no revenue whatsoever?

  • February 12, 2009

    1:22 p.m.

    Suggest removal

    AC writes:

    Logical,

    You're so off-base, you're a lost cause. Nothing you wrote is actually the case. Particularly the RMN. Liberal? That's just bizarre showing you don't actually read it. Unions? Nope. Rapidly changing revenue environment is it. Management problem, unrelated to unions. Go ahead and hate the working stiff at your own peril, but they're the ones who form the foundation of the economy.

  • February 12, 2009

    7:41 p.m.

    Suggest removal

    DiogenesTheCynic writes:

    I wouldn't be terribly quick to blame management (though it's certainly not unions or editorial stance either.)

    Anybody who blames unions or editorial stance knows damn near nothing about how papers make money, the costs involved, and how the internet has upended the newspaper business model. Partisan hacks, sit down. Class is in session.

    1) Papers make their money from a combination of subscriptions, retail ads, classifieds and online ads.
    2) The Internet (and especially Craigslist and similar sites) ripped the bottom out from classifieds. Fewer people buy them when the Internet often offers a cheaper or easier way to run their listings.
    3) Subscriptions fall because the audience of newspapers is mostly older. As they die off, there aren't enough young subscribers to replace them. Once again -- it's the net. Young readers get the majority of their information online and don't see a need to subscribe to a paper.
    4) Flagging subscriptions make it harder to charge more for retail ads, so rates (and revenue) drop.
    5) Online ads were meant to recapture some of the money lost to online news consumption but in the fourth quarter of 08, online advertising dropped precipitously.

    Every revenue source for papers is in a bad way, and unlike online-only counterparts, they maintain large staffs and have to pay for daily printing and distribution. The business model is a dinosaur but the technology to make a successful electronic distribution only business isn't yet here (we're mostly talking about high-quality, affordable, omnipresent e-readers.)

    How is it you right-wing wackos can scream "free market" at the top of your lungs and then forget to look for the rational free market cause that's underlying the collapse of newspapers of both the political left and right?