To Newsroom Associates
08/02/2007 11:22 AM

Subject Expense reductions and layoffs

Folks,

Most of you heard during town halls last week that revenue problems
continue to plague our company and our industry. We learned, for
example, that revenue was 14 percent behind last year and profit was 38
percent behind. And last year’s financial results were behind the year
before.

You also heard that one necessary solution was to cut expenses,
including the elimination of positions, people and other non-payroll
costs.

None of this is easy. But the truth is, as we see revenue continue to
fall, especially in print, our company needs to take strong action to
regain some balance.

So today we began a series of actions in the content center that include
layoffs. Unlike the voluntary severance we went through last year,
people this time are being asked to leave.

The deputy editors and I have made every effort to minimize the effect
on people. We are cutting space, eliminating open positions, reducing
freelance, dropping some wire services and saving money any way we can.
Still, some people will need to leave.

The process is difficult and painful – especially for those most
directly involved. They have done nothing wrong; they are good people.
We will miss them.

I ask that you be respectful of the individuals involved. The compiling
of lists, the emailing of names or idle speculation and gossiping will
not be helpful to them or those of us who need to continue to build and
grow our future with fewer people.

Our plan is for everyone to be notified and most of those affected to be
gone by next Thursday. We will hold a session in the hockey rink 3:30
p.m. Thursday, Aug. 9 to attempt to answer your questions.

The publisher and executive team have requested that we not talk about
specific numbers of people involved here or throughout the company or
the total expense reduction. You’ll recall from the town hall meetings
that every division within Freedom is being asked to cut costs.

Our entire industry is in a state of transition. We are seeing
fundamental shifts in the way people acquire and use news and
information. We have a lot going for us in Orange County. We have a
strong economy and a vibrant community. We have good customer
relationships, smart people and one of the best community news gathering
organizations in the country. Local news and information continue to be
our strength and a powerful competitive advantage.

If we can focus on the light at the other side of this small tunnel
rather than the darkness, we will prosper. We have some good plans in
the works to deal with a slightly smaller staff and prepare ourselves
for a new way of thinking and working, as well as the creation of new
products. We have already seen substantial results from our efforts on
the Web.

Please be helpful and kind to those who are leaving and to one another
as we work through the changes in the way we work. And thank you for all
of what you do every day.

--Ken