The Capistrano Insider

It's Official: Register Parent Company is BK

Freedom Communications, the parent company of The OC Register, which also publishes a couple of dozen community papers in OC, declared bankuptcy today. But that's a good thing, the company's CEO said.

From Reuters:

"Reaching this agreement with our lenders provides us with an orderly process to re-align our balance sheet with the realities of today's media environment," Freedom chief executive, Burl Osborne, said in a statement.

The bankruptcy likely ends the ownership of the Orange County Register by the family of R.C. Hoiles, who purchased the paper in 1935 and is known for his libertarian philosophy

Here's the entire report.

Report: OC Register Parent Company to Declare BK

The Wall Street Journal is reporting Freedom Communications, the parent company for the Orange County Register and Capistrano Valley News weekly here in town, is prepairing to file bankruptcy.

The story talks about the challenges of the newspaper industry, but note Freedom took on an equity partner to the tune of $460 million a few years back when some of the founding family members wanted to cash out. That's a big nut to pay.

From the story:

Freedom Communications Inc., the owner of the Orange County Register, is expected to declare bankruptcy this week, according to people familiar with the situation, the latest in a string of Chapter 11 filings in the battered newspaper business.

The company, majority owned for more than 70 years by the Hoiles family, has reached agreements with its lenders to restructure its debts, according to these people.

With annual revenue of about $700 million, Freedom owns the Register and more than 30 other daily papers and eight TV stations. Earnings before interest, taxes, depreciation and amortization -- a popular measurement for leveraged companies -- have declined about 75% over the past five years to about $50 million.

Freedom was founded in the 1930s by R. C. Hoiles, a former printer's apprentice who used his publications in part to spread his libertarian views. The Orange County Register continues the libertarian approach but, like other newspapers across the country, has had to confront the question of its survival.

Here's a link to the entire piece.

Ah, the Future of Journalism

I was invited to speak to the San Juan Rotary next week to discuss the future of small town newspapers and even journalism itself, I guess.

I cling to my belief that small papers, where costs are relatively low, can continue to strive. They're connected to their community, understand their community and it shows in the story selection, reporting and writing ... remember how long it took the OC Register to do a story on the passing of Tony Forster? And Dick O'Neill's death didn't make the cover of the Capistrano weekly ...

Hmm.

That said, I'm not terribly sure how technology will play a role. It's sure easier to start and run a paper these days than in days past. I can report with the Internet and e-email, take a cell phone with me out in the field ... when I started with the Register, we didn't have those things.

I can also write up my story and plug it into a layout program, then create a .pdf file to upload right to the printer. It's printed out directly on a metal plate there, and that goes right on the press. Essentially two people doing the job of several.

But the next generation is confusing ... We have our Web page, of course, and we have this blog. And a school blog. We also have the e-mail blast that goes out to a lot of people. Now, too, The Dispatch has a Facebook page, and even a Twitter account. We even have our Youtube site. Lots of communications tools.

I'm not sure how they're all going to fit together. I'm not sure anyone does, but we're all in the game, waiting for something to emerge.

And now someone is taking a bold step: Media News says no more free Internet content:

MediaNews execs: We'll no longer give away all our print content to web users

 

May 8, 2009

To: MediaNews Group Employees
From: Dean Singleton, Jody Lodovic
Re: Interactive Strategic Summit

Two weeks ago, 22 executives from across the company, including Publishers, Editors, and Interactive leaders, met to discuss MediaNews Group’s interactive strategy. While our websites attract a significant audience and drive considerable page views, we face three daunting challenges that needed to be addressed. First, we continue to do an injustice to our print subscribers and create perceptions that our content has no value by putting all of our print content online for free. Not only does this erode our print circulation, it devalues the core of our business - the great local journalism we (and only we) produce on a daily basis. Second, our interactive revenue growth has slowed because it has been too closely tied to our print classified business, which has suffered with the advent of Craigslist and other free online classified opportunities. Finally, we are not significantly extending the reach of our audience, as our online products too closely resemble the newspaper, and thus fail to meaningfully reach the next generation of readers.

This interactive summit was meant to address these issues head-on; to build a strategic plan that places a value on our content, protects our core print business, extends the reach of our audience, and creates new revenue opportunities online. We cannot continue to give all of our content away for free; we must consider, create and deploy new products and sites that both decouple our interactive revenue from our classified business and offer a compelling new experience for a younger (non-newspaper buying) demographic. From this conference, we have built consensus on a three pronged approach to enhance our business moving forward:

* We will begin to move away from putting all of our newspaper content online for free. Instead, we will explore a variety of premium offerings that apply real value to our print content. We are not trying to invent new premium products, but instead tell our existing print readers that what they are buying has real value, and to our online audience (who don’t buy the print edition), that if you want access to all online content, you are going to have to register, and/or pay. If a non-subscriber wants the newspaper content in its entirety online, they will be directed to some sort of registration or pay vehicle (and if they are a print subscriber, they will have full access at no charge). To be clear, the brand value proposition to the consumer is that the newspaper is a product, whether in print or online, which must be paid for.

* We will begin differentiating our sites from the newspaper and focus on strategies designed to reach younger audiences and extend our reach. The websites, newspaper.com as we call them now, will become a different product. This new site, which we have been calling news.com, will be a regional news site that is actively managed to present breaking news. It will continue to draw a content from the newspaper (but probably in a more abbreviated form), but will also have user-generated content, community involvement and third party content. News.com will continue to serve our existing audience, which spends a lot of time on our sites, and drive significant traffic. They like and depend on our sites for their national and local news. We must not alienate them as we strive to expand our audience and attract younger people and non newspaper subscribers. Obviously, our sites must draw upon the content of the newspaper, but the presentation of that content will be different. News.com will be an entry page to new content offerings, local retail advertising opportunities and premium offerings.

* We will build a new local utility site (Local.com), which is an ecosystem of local information, resources, user content, shopping guides, and marketplaces. This site will be focused on a younger audience as well as other targeted audiences based on demographics which are attractive to our current and potential advertisers. We have the advantage of being the trusted source of for news and information in our communities and have a large base of traffic to feed into Local.com. Local.com will leverage existing newspaper content and existing traffic, and we will add new content (such as Entertainment/Lifestyle) to target a younger audience. Central to this local site will be an aggregation of city or community sites (in the YourHub model) and marketplaces. Local.com will be the ultimate site for people to find stuff, do stuff, and get stuff done in their local market.

We will initially focus on five or six niche vertical content channels to support targeted advertising opportunities (many of which have reverse publishing opportunities). We will build these out with a common template, for ease of execution and maintenance, and deploy across the company.

New tiered circulation pricing strategies will be considered as part of, and tied to, the above online strategies. Such pricing strategies will be designed to maximize revenue, improve overall profitability, add value to full priced, seven day delivery, subscriptions, and reinforce the value for online content.

In order to execute this vision, we have agreed that these new strategies will be done with a template approach, using a menu of common tools and vendors. We will take advantage of the size of MNG to leverage enterprise solutions and build off a common platform that allows for fast implementation and a companywide rollout.

We will form four taskforces (News, local, premium and technology) to drive these ideas to market. They will focus on content, sales, marketing, research and build a business plan. We will also form a technical taskforce to evaluate the needs of a new content management system.

We will keep you posted periodically as we develop these new products and as this strategy evolves. Our online business is a critical piece of the future growth of this company and is integral to growing and targeting new audiences. Our newspapers continue to attract the largest and most desirable audiences in our local markets, but we feel strongly that developing new and targeted audiences online will position us to deliver the most comprehensive and effective solutions for our advertisers.

Orange Coast Magazine Takes Notice of Capistrano

San Juan Capistrano is one of the best places in Orange County to live, at least according to the current issue of Orange Coast Magazine.

 “Orange County’s smartest places to live may be the five walkable and historical rail towns, which seem oddly futuristic in this volatile, ecoconscious era. They’ll seem even smarter in coming weeks as summer gas prices begin to rise,” the magazine says.

That puts Capistrano in line with Fullerton, Orange, Santa Ana and San Clemente as the top five spots. Fullerton scored a 92 on the Walkscore.com rating, while Orange was a 91. Santa Ana, San Clemente and Capistrano all came in at 88. The magazine cited the Mission, El Adobe and the Coach House as downtown gems, and calls out a number of downtown attractions as what makes the city special.

We know that. But click here to see more of what Orange Coast thinks.

Mickadeit on the New Shell Station in Town

OC Register columnist Frank Mickadeit -- I think the entire paper should be written like Frank's column and the Watchdog column -- wrote about the owners of the new Shell station in town.

He framed it as one man's success against Big Oil.

The station -- which has a carwash, flower shop, yogurt and food, oh, and gas -- is open now.

Here's Frank's column.