Staff Reporter

After roaring into the San Fernando Valley in the '80s and Ventura County in the early '90s, the Los Angeles Times is rethinking its strategy for those areas.

Executives from the paper recently announced several cost-saving measures intended to help boost the company's profit margins and structurally overhaul those editions. Staffs are expected to be significantly streamlined, and greater emphasis will be placed on the weekly Our Times community news supplements.

The tactical change for the Valley and Ventura suggests that those branches of the paper were not profitable enough to satisfy Publisher Mark Willes though Times executives insist that the makeover only reflects an eagerness to try new business models.

"We're taking a proactive approach, responding to our readers' interests regarding community news while constantly striving to be more efficient," said Kathryn Downing, the Times' president and chief executive. "The changes at the Valley and Ventura editions reflect only that we as a company are getting smarter."

For the Ventura and Valley regional operations, smarter apparently means smaller. Although plans will not be finalized until November, Times executives confirmed that a significant percentage of the editorial and production employees from both editions will either be reassigned within Times Mirror Co. or laid off.

The Orange County regional edition is unlikely to be affected at this time.

"We are working very hard to minimize layoffs," said Leo Wolinsky, the Times' managing editor for news. "Our employees are worried since we've been through a major round of layoffs before in 1995, but any pink-slip numbers would be premature."

While trimming expenses in the Valley and Ventura, the paper is investing in Times Community News, a Times Mirror subsidiary that publishes the weekly Our Times. The quality of these supplements has come under attack in some journalism circles because they tend to focus on "light" news and draw inexperienced reporters due to their low pay scales. But the Times intends to launch 10 new supplements over the next year. Five Our Times editions already are published, in such cities as Santa Monica and Thousand Oaks.

"Our readers say they want local news, but what exactly does that mean in Los Angeles?" Wolinsky said. "Does that mean the Valley, Van Nuys, or part of Van Nuys? Using the Our Times sections is a shift in our thinking, but it will help us expand the Times coverage and hopefully attract new readers."

Wolinsky emphasized that the Our Times editions will supplement the regional editions, not replace them.

"The proposed changes at the Times is a recognition that a community as diverse as L.A.'s can't be served by the existing metro model," said newspaper analyst John Morton. "The Times needs to go down more deeply into the community, to cover news from an even more local angle. That will be key in increasing readership and advertising."

The supplements are expected to draw in new advertisers. Based on the results of extensive polling, Downing believes that small stores will decide to advertise in a Times paper for the first time because a localized clientele can now be targeted.

By moving deeper into community coverage, the Times also is challenging Dean Singleton's increasing hold on L.A.'s community papers. Analysts have predicted that his Los Angeles Newspaper Group, which includes the Daily News, the Pasadena Star-News and the Long Beach Press-Telegram, will force the Times to fight for advertising dollars and readership.

Times executives were circumspect in describing their plans regarding the Los Angeles Newspaper Group, but Wolinsky did say that the Times does not view those papers as serious competitors in terms of editorial quality.

The changes come at a time when Times Mirror is showing declines from its 1997 performance, although it's still performing better than most newspaper companies. Circulation has grown, and advertising revenue has held relatively steady, a feat in the current newspaper climate.

For the second quarter ended June 30, the company reported net income of $49.2 million, compared with $66 million for the like period a year ago. Times Mirror stock has slid from a high of $65.80 in June to $53.50 as of late last week.

"The decline in stock value is consistent with general market trends and is not indicative of any problem at the Times," Morton said. "Wall Street is enamored with Willes and his cost-cutting. The market and shareholders responded favorably when he last cut costs in 1995, and it is likely that they will do so again."

For Willes, who had no newspaper experience before coming to the Times, the company's financial performance has not been good enough. He and his management team have announced a goal to increase circulation by 500,000 and ultimately by 1 million grow revenue by at least 5 percent a year, and realize double-digit earnings growth.

To help realize those earnings goals, Times executives announced other cost-cutting tactics for the entire paper. The newspaper is expected to shrink in width, saving millions of dollars in newsprint annually. A senior management team is also examining "layout management," suggesting that articles may be shortened to save newsprint. New subscription plans will be offered to entice new readers without heavy marketing investment.

Also, the Times will roll out a new regional edition. Executives would not say what area the paper will target, but company insiders believe it will be either the Riverside/San Bernardino area or the San Gabriel Valley.

Times executives freely admit that they are taking a gamble in restructuring the paper, but promise even more changes to come.

"Mark (Willes) intends to try new ideas until we find one that works economically," Wolinsky said. "We will fail sometimes, but we hope that we will still serve our readers with each change."

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