All-Sports Newspaper Kicks Off as Industry Watches From Sidelines

Even before it prints its maiden edition today, the much awaited daily sports newspaper called the National already may have subtracted from the quality of sports journalism in America.

At least to the extent that it has taken Frank Deford away from writing long, inventive feature pieces for Sports Illustrated.

Instead, Deford, who is arguably the country’s premier sports writer, is the National’s editor-in-chief, chief architect, top spokesman and also its TV pitchman in ads hawking the paper’s launch today in Los Angeles, New York and Chicago. But his writing will be limited to a once-a-week column.

What lured him and what has piqued the curiosity of the publishing industry is the prospect of the first nationwide newspaper devoted exclusively to sports. And it also may be a chance to test what could be a new direction in American newspapers--narrow-interest publications aimed at attracting people who don’t read other daily newspapers.

Two somewhat limited attempts to start all-sports newspapers in this country failed in the 1980s, including one by the Pasadena Star News under then-owner Knight Ridder.

But Deford and his crew believe that they can duplicate the success of the sports dailies thriving in Europe and Latin America by having circulation sales instead of advertising drive the paper. The strategy, unusual in the United States, relies heavily on editorial strength, such as Deford’s.

The National already caused tremors of worry and expectation in the journalism fraternity last summer when Deford managed to nab several marquee sports writers, among them Scott Ostler of the Los Angeles Times, Mike Lupica of the New York Daily News and Dave Kindred of the Atlanta Constitution, along with two Pulitzer Prize-winning investigative reporters.

It also has the considerable finances of elusive Mexican television magnate Emilio Azcarraga, plus the skills of Deford’s former Princeton classmate, Peter Price, the former publisher of the New York Post.

What they have produced is a Sunday- through-Friday tabloid of about 48 pages, a local section for each city edition with one long feature each day, a SWAT team of columnists--and so many tables and statistics that hockey fans can track the “power-play efficiency” of every team daily.

The fundamental question implicit is how deep is America’s appetite for sports--when fans already can watch ESPN at night, get the local paper in the morning, then USA Today, and once a week the Sporting News and Sports Illustrated. Price, the publisher, is hoping to guarantee an initial circulation of 200,000-250,000 from the first three cities, and plans to be in 12 more by year-end.

Yet there is also the broader question here about where newspapers are headed.

Younger Americans are not turning to newspapers as they grow up the way previous generations did. The National is built in part on the theory that some of those who get their news from television may still turn to reading every day if the newspaper is focused on their specialized interests.

If so, targeted or niche-market newspapers--by demographic group, subject matter, age, etc.--might signal the direction of newspapers in the next century.

Publicly, even Price is estimating that the paper may need five years and $100 million to make a profit. Azcarraga, who is paying most of the bills, avoids publicity.

“It is a well-thought-out approach,” said John Reidy, the publishing analyst with Drexel Burnham Lambert. “But the real thing is getting the readers.”

Certainly there are enormous risks. For one, skeptics note that USA Today has yet to turn an annual profit, with losses estimated around $600 million since its launch in September, 1982--not counting the costs Gannett absorbed by borrowing staff and resources from its 80-plus local papers.

While it has circulation--roughly 1.4 million as of last September--USA Today does not have enough advertising. One reason is that the national advertising market for print has weakened, perhaps permanently, with several categories such as liquor and tobacco never returning to the levels of the late 1970s.

Price said the National is predicated on a delicate strategy that might avoid this problem: He wants to build the paper’s cost structure so that it can survive largely on circulation, not advertising.

This would make it more in the manner of a European paper, which might get 70% of revenue from circulation and only about 30% from ads.

In the United States, the structure of newspapers is just the opposite--largely because American papers are home delivered and contain so many pages that they are more expensive to produce than European papers. As a rule, the 25 cents that the reader plunks down doesn’t even cover the cost of the newsprint. Advertising must make up the rest.

To break the cycle, a newspaper would have to be thin, which would mean it could contain less news.

But as a specialized publication, the National is hoping that at 48 pages it can both be the most in-depth provider of sports news and still be small enough that its newsprint costs will be low. Price says newsprint will only cost him about 10 cents a copy.

To keep distribution costs low as well, it has contracted with Dow Jones, publisher of the national Wall Street Journal, to deliver the paper to newsstands.

Even if it is eventually profitable, Price said he expects the National not to get more than 50% of revenue from advertising.

So far, ad commitments are impressive, analysts report, but at less than $10,000 for a full-color national page and less than $4,000 for a local page, the National is cheap to buy.

“I think it could be done, but I would have believed this strategy more if they were selling for a higher newsstand price than 50 cents,” said Ken Noble, a publishing analyst with the brokerage firm Paine Webber.

With this approach, “the most important thing will be to get enough readers,” said John Morton, a newspaper industry analyst with the brokerage firm of Lynch, Jones & Ryan.

Even a quarter of a million readers won’t do it, even just for three cities, said Reidy.

One result of the strategy, though, is that the National is largely driven by the journalism. Of the 175 member staff, an extraordinary 125 are reporters and editors.

In an earlier era, the Wall Street Journal was analogous, specialized enough to be thorough in only a few pages. Yet as its readership grew, so did its advertising, and now its cost structure is advertising-driven like most of the rest of American media.

And the Wall Street Journal in the beginning had little competition, since most business sections were a newspaper’s backwater, hidden behind the sports pages and the tire ads.

There is intense competition facing the National--from strong local sports coverage in newspapers, to ESPN’s all sports channel on cable TV, to sports phones, CNN and USA Today, which already produces the most detailed sports section in the country.

To distinguish itself, the National’s statistics and reports are even more detailed. A key question about the paper’s success is how much more people really want.

If the National is right that people do want still more, USA Today could be one of those hardest hit. For despite recent statements to the contrary from officials at USA Today, sources closely familiar with USA Today’s internal research said its fine sports section is one of the primary reasons people buy that paper.

Another problem is whether the National can survive entirely on street sales in an industry built on home delivery.

One of the National’s ads for Southern California, for instance, notes that “there are only six newsstands in L.A. County,” and pleads to viewers, “You guys are going to have to help us.”

Without intending to, the ad also highlights still another problem. One of the keys to whether the National succeeds will be how well it mixes local copy--the Southern California edition includes coverage of all the local teams and a separate local columnist each day--into an essentially national publication.

Can a central desk in New York be so multi-regional? The ad about Los Angeles sounds just a bit dismissive, as if it were written by a smug New Yorker: “You come out of your house, get into the car, pull into an underground garage, go up into the office, never breathing the smog.”

In Azcarraga, the most important figure in Spanish language television, the National is backed by one of the richest men in the world and one with a reputation for taking a long-term view of his investments.

In hiring Deford, the National also hit a home run. Then Deford and Price followed with a strategy that has made the paper the most anticipated venture in newspaper publishing since USA Today.

After saying nothing publicly about the paper at first, all at once Deford made extravagant offers to some of the best-known sports writers in America, including Jim Murray and Ostler of The Times. Among those hired, reportedly doubling salaries and guaranteeing multi-year contracts in some cases, were Ostler, Lupica, Kindred and John Feinstein, who struck it rich writing a book about basketball coach Bobby Knight. Then he hired two highly regarded sports editors, Van McKenzie of the Atlanta Journal and Constitution and Vince Doria of the Boston Globe.

That was carefully thought out to get journalists to say, “ ‘If these people are talking to all of these people at once, what the hell is this thing,’ ” said Deford, a writer who, as a star of Lite Beer commercials and a veteran of 10 book tours, had a fine understanding of the black art of promotion. “They had to take us seriously.”

Nor is the National, as USA Today Managing Editor for Sports Gene Policinski has dismissively suggested, mostly long stories. The bulk of it is statistics and short reports, gossip, facts and factoids ad infinitum--or ad nauseam.

All together, the National resembles USA Today more than Deford’s alma mater, Sports Illustrated.

It even has a color weather map, with the various stadium sites listed and weather forecasts for key games.