Kushner and Freedom Communications partner Eric Spitz. Grant Slater/KPCC
At the end of a 15-minute interview of Register owner Aaron Kushner on KPCC's "Airtalk" this morning, Larry Mantle observed that the answers lacked a certain specificity. "I have to say, if I worked for you, hearing your description and the lack of specifics, I'd be very nervous about the future," Mantle said. When Kushner opted not to respond, Mantle followed up: "Speak to that, please, what do you say to your employees? How do you convince people that things are going to go in a positive direction?"
Said Kushner: "Our employees who actual see our numbers and understand what we're doing as a private company see and feel every day the growth that we're experiencing."
Of course, that's just not so. Register staffers by all accounts are pretty freaked since being told on Tuesday that they must take two weeks off without pay in the next two months — an indication of serious cash problems, experts in the field say — and most of the newsroom staff was also offered a voluntary buyout package under threat of layoffs. Basically, Mantle gave Kushner the opportunity to go beyond his usual soft assurances of good intentions and offer some specific evidence that the Register experiment is working. Didn't happen.
Also from the interview:
What is the financial condition of Freedom Communications right now?
We are growing and are continuing our significant investment in the Los Angeles Register, which launched about six weeks ago, and our expansion in quality investment in the Orange County Register, The Riverside Press-Enterprise as well. We have seen and experienced that growth already and are looking forward to a very long term and healthy future.
The moves that we had to make in terms of our internal cost structure, are about aligning our bold investments in community building and the future of newspapering with the results which we are seeing, which are growth, but at a more moderate rate than what we had invested in terms of our internal cost structure, so, being able to, over the long term continue to invest in building community with the Los Angeles Register, with the Orange County Register, that's the focus of our moves over the last few days.
What do you say to your employees who now are very worried about the future of the papers?
We have over doubled the size of our newsroom and, yes, unfortunately some of that wonderful talent will have to find their success elsewhere. After our restructuring is concluded, we still will have significantly more great journalists than we had when my partner and I bought the Register and started expanding and growing the value we're providing almost two years ago now. We're highly confident that the team as it continues will be able to continue to deliver against our mission of community building...
Meanwhile, media analyst Ken Doctor is no longer in the optimistic wait-and-see camp. He sees the Kushner strategy swerving all over the place, with this week's urgent cutbacks the worst sign yet. "It’s a big red flag, screaming we’re running out of money really soon, following numerous months of yellow flags," he writes at Nieman Journalism Lab. "What happened? First, we can look at the strategy — and some observers question how much there has been one all along — and see a series of lurches."
Second, the Kushner contrarian business strategy hasn’t worked. The over-investment in print, as print continues to slowly die off, and the under-investment in digital, has only exacerbated the effect of ownership’s poor driving habits.
The enthusiasm of Kushner and Spitz is hard to dislike. In a short period, they’ve brought numerous good marketing ideas forward (“The newsonomics of Aaron Kushner’s virtuous circles”). But those have been swamped by the many issues of money and management. That newsroom, built up to a level of 375, may be down to 245 soon. That’s still more than 50 greater than when Kushner and Spitz took it over, but several dozen of those 245 are interns and trainees, young journalists with more enthusiasm than experience covering their communities. Certainly, a case can be made for the massive change in the staffing, but the problem that now dogs the O.C. duo is credibility. How can they convince readers, advertisers, staffers, and their communities that they are really invested for the long haul?
Overall, it’s been a down year for those looking for out-of-the-box models to local newspapering.
"Thursday update: Kushner's December 2013 Powerpoint pitch to prospective investors. OC Weekly