Neuharth Tells Publishers to Raise Their Prices : Media: The ex-chairman of Gannett appears to swipe at former newspaper colleagues in proposing a remedy for the slumping industry.

Former Gannett Co. Chairman Allen H. Neuharth, who has been taking veiled digs at his former Gannett colleagues in recent months, seemed to knock them again Wednesday in a speech that criticized U.S. newspaper executives for not raising newsstand prices enough.

In remarks to a meeting of the Southern Newspaper Publishers Assn., Neuharth said most of the country’s 10 public newspaper concerns could have offset the effects of the industry’s current slump by raising prices to 50 cents or more per copy.

Most of the companies “are shortchanging shareholders with unnecessary profit plunges caused by cautious corporate bean counters,” said Neuharth, who is now chairman of the charitable Gannett Foundation. “The solution to your profit squeeze is simple: Put more news in your newspapers and charge more for it.”

Neuharth’s remarks, made in Colorado Springs, Colo., were distributed in a news release from the Gannett Foundation, which said:

“Neuharth did not mention his former company by name, although it reported its first quarterly earnings decline in 22 years. But he said, ‘Every public newspaper company could have avoided or curtailed the current profit slump if management stopped blaming advertisers and instead prudently priced its products.”’

Gannett’s USA Today costs 50 cents, but the chain’s other 82 dailies are priced between 25 cents and 35 cents, a Gannett spokeswoman said.

Peter P. Appert, an industry analyst with the C.J. Lawrence, Morgan Grenfell brokerage in New York, said the comment about Gannett “sure seems like a swipe to me. . . . That’s too funny.”

Douglas H. McCorkindale, Gannett’s chief financial officer, laughed when he was read a portion of the speech. But he insisted that it was not aimed at Gannett executives. “He’s been using that kind of language for 20 years,” McCorkindale said.

Industry observers have been talking about a rift between the outspoken Neuharth and Gannett’s current management since last April, when the foundation announced that it would put its 10% stake in Gannett on the market. There was speculation that the move might open the way for a hostile takeover of the company.

John J. Curley, Gannett’s chairman and chief executive, has on several occasions told Wall Street analysts how he trimmed $16 million in unnecessary corporate overhead when Neuharth retired last year. Subsequently, in his regular column in USA Today, Neuharth wrote, somewhat enigmatically: “Some people I have favored or fostered over a quarter century have turned and bitten my hand.”

Curley and Neuharth have publicly denied that a rift exists. Neuharth was traveling later Wednesday and couldn’t be reached to clarify his intentions.

In his remarks, Neuharth said that only 64 of the country’s 1,626 daily newspaper charge 50 cents a copy and that such major papers as the Miami Herald, Washington Post and Los Angeles Times charge 25 cents for single copies at the newsstand.

Several industry analysts agreed that, in general, there may be room for newspapers to raise prices without hurting circulation. They noted that the industry is headed to higher prices. But they said that since circulation revenues make up only one-fifth to one-quarter of total revenues, in most cases a hike would not come close to offsetting the financial effects of an advertising slowdown.

“You can raise your prices and it won’t mean a hill of beans if advertising is going in the other direction,” said Appert. He noted that a number of newspaper companies have raised home subscription prices while maintaining newsstand prices.

David Laventhol, publisher of the Los Angeles Times, said newspapers “are mass-circulation publications, and our objective is to be read by as many people as possible, for their information, and to give maximum exposure to our advertisers. We’re always looking at our pricing, to be prudent economically and to do what’s right for the consumer.”

Michael A. Kuchinski, a newspaper analyst with the investment firm A.G. Edwards & Sons in St. Louis, said that although he agreed that some papers have room to raise prices without depressing circulation, newspapers in competitive markets “might not find that so easy.”