As Business Section Expands, So Do the Potential Problems
In many ways, the Business section of the Los Angeles Times is the model for what Publisher Mark Willes envisions throughout the paper. But it also embodies some of the pitfalls of Willes’ radical approach to newspapering.
Even before Willes became publisher last October, the Business section had begun publishing Company Town features on the entertainment industry four times a week and had added weekly subsections on technology, small business, personal investing and personal finance, and advertising and marketing. A subsection on commercial real estate that had been in the planning stages for several months began shortly after Willes took over.
The result of all this: A 16% increase in advertising revenue last year--including $8 million in new advertising--along with expanded coverage of several areas that Bill Sing, the paper’s business editor, says Times readers are interested in.
Another result: Because the Business staff did not expand as the new subsections multiplied, the staff hasn’t had enough time to cover general business news or to do original enterprise reporting that’s not tied to these new sections; when general business news is covered, it often gets lost among the new features, which typically occupy about 65% of the front page of the Business section--and 70% of the entire section (exclusive of stock tables).
“Because we’re not adequately staffed,” Sing says, “it has hurt some of our core news mission.”
In a meeting with the paper’s top executives last month, Sing said: “Mistakes are getting into the paper because there is not enough time to edit; important stories aren’t being adequately covered . . . deadlines [are] being missed regularly.”
A Case Study of Expansion
Why hasn’t the increased advertising revenue been used to hire more staff and alleviate these problems? Isn’t that how it’s supposed to work under Willes’ plan?
Sing says that when the first new subsections began, he wasn’t given additional staff because “there was a lot of skepticism about whether we’d make them successful.” But when he launched the commercial real estate and advertising and marketing subsections, “we got what we asked for”--five new full-time positions.
At last month’s meeting, Sing and Kelly Ann Sole, the general manager for the Business section, made a formal presentation of their 1998 strategic plan for the section, including proposals for increased revenues, new features and reader services; Sing formally asked for 12 new full-time staffers--the number that he and Michael Parks, the editor of The Times, had previously agreed was necessary. Sing also requested a 15% increase in the space he has each week to cover general business news.
Willes immediately granted his requests, and Parks subsequently authorized hiring two additional staffers for the Business section.
“There’s no question you need the people,” Willes said. “That’s a no-brainer. . . . If this is what you think we ought to do, then you ought to go ahead and do it and then we’ll figure out how to pay for it.
“This is an example of why we need this process” of section general managers and strategic plans, Willes said. “You should have been given those resources at the front end, before you took on all the extra work.”
The new staffers--some to be transferred from elsewhere at the paper, others to be hired from outside--will increase the full-time business staff from 57 to 71.
Sing and Sole worked as a team in making their case for more resources, as they have since Sole joined the paper two years ago after working as national sales manager for the Daily Journal Corp., which publishes legal newspapers.
Sole says that one of her first discoveries on joining The Times was that investment securities firms provided only 8% of the advertising revenue in the paper’s Business section. When she asked around on Wall Street, she says, the response was invariably, “‘The L.A. Times? Very funny. Southern California? They’re all at the beach. They’re not interested in investing.’ ”
Sole told Sing, “We could get ads if we could help [the investment community] . . . get its arms around Southern California.” Sing responded by mentioning all the telephone calls his staff received each week from readers asking what a mutual fund is and how they should go about hiring a broker and what price-to-earnings ratio means.
Out of that discussion--and several subsequent discussions--came a decision that The Times’ Business section should become what Sole calls “Southern California’s financial advisor.” That ultimately led to the creation of both the weekly Wall Street, California, subsection and an annual Investment Strategies Conference--and to a 40% increase in financial advertising.
But the Business section is unique among news sections; it generates advertising revenue directly related to many of the subjects it covers. Local, national and foreign news coverage have no such direct revenue streams; the Board of Education, the State Department, Congress, the courts--none is a major advertiser. Doesn’t that make it tempting for a Business section to devote much of its space to those subjects most likely to lure advertising--and to cover them favorably? That could slight the kind of general economic reporting that doesn’t directly bring in ad revenue--and the kind of tough investigative reporting on financial institutions that takes time and might offend potential advertisers. That problem may be especially acute in a climate in which there is pressure for increased revenue and profitability.
But Sing says that he hasn’t created any special sections primarily to serve advertisers. Everything was conceived “primarily because it attracts readers,” he says. “If the advertising department came to us and said, ‘We could sell some ads to these widget-makers, so why don’t you do some stories about widgets,’ I’d say, ‘Get lost. There aren’t many readers who want to read about widgets.’ But a lot of our readers are interested in investing,” so the paper created Wall Street, California.
Similarly, Sing says, Los Angeles is “the small-business capital of the world. . . . It makes sense for us to write more about small business. . . . A lot of advertisers want to reach small-business people . . . so to the extent that I create a compelling product for readers, then it becomes an interesting and compelling product for advertisers.”
Some of the Business section’s “compelling products” are actually byproducts--the two-day Investment Strategies Conference that The Times sponsored last year and again last month being perhaps the prime example. More than 12,000 people paid $45 to $55 apiece this year to hear speeches and attend workshops and panel discussions involving financial experts from around the country.
The conference brought 62 new advertisers to the paper over the last two years, Sole says, and The Times published a 72-page special section on the conference that was also used as a program for the event; the section brought in more than $600,000 in advertising revenue, the most ever for a special section at the paper.
Sing is delighted by the new revenue his section has brought to The Times, and he is adamant that his role in helping to attract that revenue does not compromise his editorial independence.
Too often, Sing says, journalists think their job is solely to “cover the news . . . and write compelling stories for readers.” But for newspapers to survive, he says, they must also “think about the whole enterprise . . . take business into consideration.”
Reusing Information for Extra Revenue
Newspaper executives have been increasingly concerned in recent years, for example, about the amount of resources they expend to gather news that is published once, then essentially thrown away when the entire, costly process begins again the next day. They have been searching for ways to reuse that information, to earn additional revenue from it with little, if any, added expense. Toward that end, Sing envisions taking some of the Money Makeovers in The Times’ weekly Personal Finance section and repackaging them as a book. Other Business section features could be similarly repackaged.
But that could lead to a skewing of priorities. Journalists might be tempted--or induced--to do those kinds of stories that can be repackaged at a profit later, instead of news and investigative stories that readers need and want right now.
Sing says he recognizes that risk and will do his best to avoid it. But he also says that some of the stories that can be packaged may not represent a skewing of news priorities so much as “a redefining of what news is”--news as something that helps ordinary people make decisions on personal finance and other everyday concerns.
