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Tuesday, Mar 21, 2023

Paper’s Parent Pages Techies

The Los Angeles Times looks set to sharpen its focus on digital efforts now that owner Tribune Publishing has tapped a former technology executive to lead the struggling media company.

Justin Dearborn replaced Chief Executive Jack Griffin last week in a surprise shake-up. That followed Michael Ferro, founder of Internet startup Click Commerce, coming on board as Tribune’s largest shareholder and chairman.

The Times could now benefit from a “complete new direction” oriented around digital initiatives, said analyst Hamed Khorsand of BWS Financial Inc. in Woodland Hills.

“Tribune has to be more aggressive and they’re approaching that with a new CEO,” he said.

Dearborn, who had helmed Chicago medical imaging company Merge Healthcare, where Ferro was chairman until last year, said he would bring a tech-savvy mind-set to the Chicago legacy brand that runs the Times and various other newspapers.

“Tribune Publishing has a significant opportunity to leverage technology to increase the value of its content and distribution channels,” Dearborn said in a statement. “Although this is a different medium than my last technology company, it has the same challenge on how to create the highest value for our content.”

Ferro, a majority owner of Chicago Sun-Times parent Sun-Times Media Group since 2011, became Tribune’s largest shareholder earlier this month in a $44.4 million deal. He soon wrote on his LinkedIn profile: “Ferro is determined to usher the historic company into the digital age, focusing on big data and artificial intelligence technology.”

A Tribune spokeswoman said Ferro and Dearborn would not comment until an earnings release next month. A Times spokeswoman also said the paper would not immediately comment.

New strategies

The Times, Tribune’s biggest newspaper in terms of daily circulation and profits, has struggled for years to squeeze digital revenue from a traditionally print product.

Tribune’s stock as of last week traded at $7.32 a share. That’s a long fall from about $25 a share in 2014, when Tribune Media ended its four-year bankruptcy and bundled newspapers into Tribune Publishing, axing off the more profitable broadcast and digital assets. Austin Beutner became the Times publisher, and the L.A. civic booster launched marketing initiatives meant to attract readers and advertisers around California-focused coverage.

He was fired in September after just a year on the job, replaced by Baltimore Sun Publisher Timothy Ryan. Beutner said then that his strategies needed time to bear fruit. He declined to comment on the new Tribune leadership.

A Tribune buyout program last fall led to the departure of about 80 Times staffers, including columnists, foreign correspondents and senior editors, reportedly meant to save $10 million in costs. The paper is now slowly rebuilding its ranks, but is unlikely to fill all the vacant positions.

Although it is unclear what tech strategies Tribune might pursue at the Times, Santa Cruz-based media analyst Ken Doctor said they will only succeed if they can attract readers and advertisers.

“The question is how high-minded Silicon Valley talk will convert into the basic building blocks of business,” Doctor said.

Data analysis has been an essential tool for online-only publications such as Hollywood-based BuzzFeed Inc. The popular website known for cute kitten videos tracks what viewers want to see, then tailors content to satisfy audience demands.

But major newspapers such as the Times don’t have that flexibility, said Gabriel Kahn, who co-directs the media, economics and entrepreneurship program at USC’s Annenberg School for Communication and Journalism.

“Metro dailies can’t quite play in the same sandbox,” he said. “We expect the daily paper to be covering the city council, the mayor, the cops, the courts.”

Digital dilemma

Tribune reached 88,000 digital-only subscribers last year across all its publications. A spokeswoman said the company does not release specific metrics for the Times.

The New York Times, after implementing various digital strategies including a paywall, hit a worldwide record last summer in drawing more than a million digital-only subscribers. But even the venerable New York Times has struggled to launch digital products and change newsroom culture, Kahn said.

The Los Angeles Times will face the same battles, but without the Gray Lady’s cash cushion and management. And it will need to do so in publications and markets stretching across the country.

“ ‘TPUB’ is many different things,” said Kahn, referring to Tribune’s stock symbol. “It’s tough to find a strategy that helps Allentown and Los Angeles at the same time.”

Former Times Deputy Publisher Nicco Mele, who left after Beutner, told the Business Journal, “The largest challenges facing the Los Angeles Times are the challenges facing every single newspaper in America: persistent, significant declines in print revenue and a highly competitive digital landscape where free content is the norm.”

Ousted Chief Executive Griffin previously said Tribune’s broad portfolio allowed publications to share content, advertising and services and called the Times the company’s “jewel.”

Tribune rejected an offer last year from L.A. billionaire philanthropist Eli Broad to buy the Times along with Tribune’s newly acquired San Diego Union Tribune.

Still, there is some speculation that Tribune will eventually sell its California papers, perhaps after tacking on a few more.

Tribune recently bid to buy Freedom Communications out of bankruptcy, aided by Ferro’s cash infusion. That would give it the Orange County Register and the Riverside Press-Enterprise – and a desirable coverage zone across Southern California. The auction is set for March 16, with a sale hearing slated for March 21.

Ferro, 49, comes to Tribune after several years building up Chicago’s Wrapports, in which he is reportedly a lead investor. The private company owns the Sun-Times, Chicago Reader and several digital businesses. According to documents filed with the Securities and Exchange Commission, Ferro is stepping away from any involvement with the Sun-Times.

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