City of San Diego's Only Daily - Sold!

CAVANAUGH: Our top story on Midday Edition, we've been hearing rumors and unconfirmed reports for a couple weeks now. Today, the Union Tribune made it official: A deal has been signed between San Diego City's only daily newspaper and a group headed by San Diego developer and entrepreneur, Doug Manchester. Joining me to talk about the background of this sale are my guest, KPBS investigative reporter, Amita Sharma. SHARMA: Thank you, Maureen CAVANAUGH: And KPBS senior news editor, Mark Sauer, formerly a reporter and editor with the Union Tribune for 27 years. SAUER: Good to be here CAVANAUGH: What do you think about the sale of the Union Tribune? Will local ownership be a good thing? 1-888-895-5727. Amita, what information has been released so far about this sale? SHARMA: Very little information has been released. We know that Platinum Equity has signed an agreement to sell the UT to MLIM, which is owned by Doug Manchester and run by John lynch. We didn't know what the purchase price was, we don't know what the editorial direction is going to be of the newspaper. There is a lot of worry, both at the paper and within the community of San Diego, as to whether it's going to be used as a personal mouthpiece for Doug Manchester. He's down as a conservative. He's supported a lot of Republican causes in San Diego and statewide. He gave $125,000 to the proposition eight effort, which was an effort to ban gay marriages in California. So there are some people who are worried that he may use it as a mouthpiece. CAVANAUGH: You spoke with the other person involved in this, the president of the limited company MLIM, his name is John lynch. He's a well known radio station owner in San Diego. What did he tell you about buying the UT? SHARMA: He said that both he and Doug Manchester are extremely excited about bringing the Union Tribune back into the hands of local owners upon it was sold to Platinum Equity, a Beverly hills based company, back in 2009, I believe. And now it's being brought back into the hands of local owners. And he said that we think it's a very viable business. They plan to boost the newspaper presence, boost the web presence. And he said that we want to be a cheerleader, a booster for all that is good in San Diego. What that means specifically, we don't know. Neither men have any experience running a newspaper. CAVANAUGH: I want to let our listeners know we are taking your calls if you'd like to tell us your opinion of the sale of the Union Tribune. 1-888-895-5727. Mark, recent years have been a time of great upheaval for the people over at the UT. Tell us about what's been going on. We've heard about a series, of course, of layoffs. What's it like to work there? SAUER: Well, Maureen, it certainly has. And this goes back several years, not just at this paper but at newspapers across the country. A great time of downsizing in that industry. And at the ut, a lot of us were offered buyouts. I took one at the end of 2007. A lot of folks were laid off who didn't want to be and wanted to continue working there. It's been walking on eggshells every day to come to work there. And I was talking to some of my colleagues this morning at the announcement of this, and the senior management staff had a news room meeting this morning and asked naturally about layoff, and said, no, are in the foreseeable future there won't be layoffs. But the foreseeable future isn't very long at the utthese days. They're going to keep Ed moss at publisher, Jed light at editor. Who knows what the future holds? One of my long-time colleagues said that's been the norm coming in here on eggshells and wondering if layoffs are going to be the case. And newspapers were head of the curve on that. But anybody employed in America these day, unless you're a member of the 1%, goes to work every day with uncertainty sitting on their shoulders. So it's -- who knows? Platinum is plasticable now. They were told that today. They don't anticipate layoffs. CAVANAUGH: Let me let you address some of the concerns that Amita raised, that people are saying, well, there won't be -- what about the editorial policy of the paper? What about the reporting of the paper? Is that going to be affected by the owners' political views and what has been your experience at the UT about that? SAUER: That's a really interesting question. I think the perception has been that the UT, especially into the Copleys, up to the mid-70s when Jim Copley was still the publisher and ownership of the Union Tribune, he died in his early 50s of leukemia, at the time. And there was a history there, and with a lot of American newspaper, of buy ink by the truck load, and you have a very powerful voice in the community. That's true with the Hearst papers, the McCor-Micks in Chicago. It wasn't unique to San Diego. I think a lot of that changed with the upheaval of the antiwar movement in the late 60s, certainly with Watergate, a real professionalism came to newspapers. And there was a firewall between the editorial page, which the publisher certainly controlled,s and the straight objective news reporting. A lot of these impressions and myths about papers die hard. In the old days, herb Klein, and Jerry Warren ran the Union Tribune after the merger, and they were in the Nixon White House. So those perceptions were certainly still there. Of who knows what'll happen here? The editorial page, I would expect, would get more conservative CAVANAUGH: We have a caller on the line. And we are taking your calls at 1-888-895-5727. Sunny is calling us from San Diego. Hi, sunny: NEW SPEAKER: Your scener did ask me, was I going to give them a chance. Initially I said no. I will take a look at it, but my primary response was that I would cancel my subscription to the UT. CAVANAUGH: Why is that? NEW SPEAKER: It's because the UT already is a right-leaning newspaper. And I would expect my local newspaper to be completely nonpartisan. Just do some reporting, and Mr. Manchester and Mr. Lynch have already expressed their opinions about -- they're talking about the good of San Diego? Well, you know, there's a right and a left. And we both have a voice, and I'm willing to listen to both sides. But the killer for me was the Manchester donation of $125,000, which he's fully entitled to do. Upon, to prop eight CAVANAUGH: Thank you for the call. I wonder if you could give us more background to Doug Manchester. We've heard about his political leanings. But he is also known as a developer, of course, in San Diego. What has he developed? SHARMA: That's right. He is one of San Diego's biggest private developers. He's been in the hotel business. He used to own the San Diego Marriott Hotel, and the Manchester grand Hyatt. He still owns the grand Del Mar. Manchester financial says he's been in the telecommunications business, he's been in the broadcasting business. It also says that he owns -- that Manchester financial group owns about $2 billion in financial assets. But does he have any newspaper or journalism experience? No. He does not. SAUER: And the folks in the news room, of course, will point out that plat mum equity from Beverly hills didn't either. They buy business, turn them, and turn them profitably. So there's been a report, and again, a private company, we don't know, but there's been an early report today that the sale price may have been as much as 110 million of the that's a fraction of, in the heyday 15 years ago, when the Copley conglomerate was here, be the national Copley news service, etc, Washington bureaus were worth may be as much as a billion dollars. If the the reports that we hear that platinum bought them for 35 to 50 million, which is what some of the folks in the news ram have heard, then maybe in a down economy, you're looking at a business that turn today around from 2 to 3 times basically through downsizing. Obviously, there's a real estate element to this whole transaction, and very valuable real estate here and possibly in La Jolla that the Copleys sit on. With a private again, it's hard to know what'll happen. You've got this 5-story building in mission valley, and a $42 million paid for in cash printing press there, which obviously they'll need to continue publishing the newspaper. So the question is, they're only using half that building their. Perhaps they do something else with the building, perhaps they move the news staff and advertising staff to two floors of another property, maybe, perhaps Manchester owns downtown. There's all sorts of speculation right now. CAVANAUGH: Randy is calling us from mission bay. Good afternoon, welcome to the show. NEW SPEAKER: Hi. I wanted to make the comment that having visited the Manchester grand Hyatt, when you look at the array of character that is proudly displayed there, Donald Rumsfeld, thattilk, it would indicate to me that opposed to the Copleys, I'm in my mid-50s. You used to throw the San Diego union on people's porches, and at least the Copley's people -- CAVANAUGH: I think we're losing you, Randy. Thank you for the call. Your cellphone is breaking up. So again, Amita, this concern that the new owners, Doug Manchester's political leanings may influence the paper. SHARMA: Well, the caller's point is well made. I've been to the Hyatt hotel, I went to the top floor 4 or 5 years ago, and Manchester's photograph with big, big names and the Republican party are prominently displayed all over the place. That being said, yes, there's lots of speculation about what he might want a paper for. But then the other question is, well, why would you want to throw away the UT's credibility, right? If you don't have -- if people are canceling their subscriptions in droves, what power do you really have? So are they going to walk a fine line? Will they keep some balance? I think they're going to have to SAUER: I would say during my years there with the Copley, and again, I came after Jim Copley had passed away, but under Helen Copley then later her son David, there was no overt direction as an editor and reporter in that news room. They didn't come in and say we're going to go after this person or downplay this candidate. There were certainly stories of that in the old days and campaigns in the '60s and the Humphrey/Nixon campaign in 68, for example. But it was more the firewall, the editorial page, you understand that you have a conservative owner, and they're going to do what they will, and the columnists and the editorials they choose. But in the news room, there really was a firewall. And we cover the news the way the professional editorial folks saw as we should cover it. And I don't know. It's very difficult to know if that'll continue. I would think it might. &%F0 CAVANAUGH: Jean is calling us from San Diego. Welcome to the program. NEW SPEAKER: Thank you. I was working in my yard and I happened to hear the topic. And I thought it would be of interest to listen. And I guess my concern is that the whole impact of the story it seems to be that you're concerned about Manchester having a political point of view and how that might bleed into the paper. And I would just say that I can't imagine there are any newspapers across the country that aren't owned by people that have strong political views. I'm not sure why that should be such a problem CAVANAUGH: Well, I think as mark pointed out, there's been this evolution in the news business from a time when there was a lot of yellow journalism, and owners basically said which direction the paper was going to be, conservative or liberal. And now there's been this time line of really sort of neutral news or as much as humanly possible, now the speculation is that we might be going in the other direction. Might be. That's all we're talking about. Might be SAUER: It's all speculation now. And we don't know what'll happen till the folks take over. It's a private company as we've noted. It's interesting as the the caller notes though that, yes, you really risk offending the brand and the name and the strong circulation in readership. They noted in that meeting this morning in the news room, that the October figures year to year are up on circulation. They've still got a pass-through rate, the number of folks 3.5 times read the morning paper. Upon it's still a powerful media company here CAVANAUGH: Let me ask you, because this has to be my final question, we're out of time, but we've been hearing for years now, mark, that print is dead. Newspapers are dead. And here we have a turnover, we're speculating that maybe 100 million plus has been paid for for this newspaper. But Platinum Equity turned this newspaper around pretty well. You think there's life left in the old girl? SAUER: There is, and they did it through cutting a lot of staff, they did it through setting a 2-tier wage system with younger and inexperienced reporters making significantly less than more experienced journalists. So there is all of that. Upon are they doing the ambitious series, are the investigations, the long pieces, the Sunday-takeouts when we had almost 400 folks in that news room? No, they've got maybe 30% of that now. And it's just thin compared to the old ice. But they still do fine working still have a huge news staff compared to most other news organizations in this town. And it's still worthwhile. Of course, I'm an old newspaper reader. And a lot of folks who have been around a long time are newspaper readers. And until we're gone, newspapers will be with us SHARMA: And they brought the newspaper back into the black. CAVANAUGH: Exactly right. Well, we're going to be hearing a lot more on this story. I want to thank KPBS investigative reporter, Amita Sharma, KPBS senior editor, Mark Sauer. Thank you both very much. SAUER: You bet. SHARMA: Thank you.