David Hiller's extraordinary memo to staff on changes at the Times, first reported by Kevin Roderick at LAO this morning, signals that they're finally ready to chuck the old business model and start from scratch. He didn't put it quite that way, of course, saying only that "the old model is broken." But make no mistake, it's dead and buried, even if newsroom stalwarts insist that it's just a matter of bad management or greedy owners or whatever. If there's any doubt that the old machinery simply doesn't work anymore, look at the numbers. May revenue will be down 9 percent and April cash flow was down 34 percent from last year. Those are killer results because cash flow is now the paper's most important financial number. Without adequate cash flow, it becomes harder to pare down the huge debt that Tribune took on when stockholders were paid off at $34 a share as part of the Sam Zell acquisition. Here's how Hiller put it:

The urgency of our situation is heightened by the Zell/ESOP transaction. The future value of the company - and the ESOP - depends upon our cash flow results to pay down the debt and invest for growth. If anybody has any doubt about the need to change our business to stay successful, please let me know.

So Hiller & Co. are left trying to reinvent the wheel. It's not necessarily hopeless or undesirable. Even after all the cuts, the paper has been running pretty much as it always has - the same inflexible (and often inefficient) newsroom structure that many of us grew up believing was the only way to deliver information. Well, kiss it good-bye. It's over. At least it should be over.

Project Reinvent is well underway with its mission of re-conceiving the core print paper “from scratch”, true to our journalistic mission and focused sharply on what readers need and want from a print newspaper today. This cross-company team is looking at everything, including how we organize ourselves and the paper, local coverage, story selection, length, presentation, you name it. We’re getting their full report in the next 30 days and will take action right away.