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January 2000

The Year of
Stalemate and Sitzkrieg
Managing News and Threatening Attorneys

Dispatches from the Front by Burl Burlingame
1/5/00 It's a measure of the distrust that Gannett has created among consumers that when the SaveStarBulletin site disappeared during the Christmas holiday, dozens -- if not hundreds -- of readers immediately assumed that the media giant had somehow shut it down. The fact was, the server where SaveStarBulletin resided was thoroughly hacked by unknown outsiders. I don't know who knocked it down, but we got it back up.
1/6/00 Many of the excessive number of security guards hired to hang around the newsroom were let go. Apparently, most were told that the gig wasn't a temp position.
1/7/00 Reporter Ian Lind actually made a count of newstands in a neighborhood, discovering that Advertiser racks were double the number of Star-Bulletin racks, despite supposed equal treatment by Gannett's Hawaii Newspaper Agency.
1/8/00 Uh oh. The SOS site noted that legal victories won by SOS had been routinely buried in Star-Bulletin's print coverage -- not surprising since we're owned by Liberty, the plaintiff. Pointing this out made some of the staff extremely angry. Yikes! The Guild had been the primary instrument in saving the newspaper so far, but that was underappreciated or misunderstood by the staff, probably because the Guild was busy actually doing something rather than publicizing itself. But the reaction showed that the Guild wasn't doing enough to make it's contribution known, even to our own staff. At any rate, it showed that tempers are easily frayed under the circumstances, and that the anger is misdirected -- it should be aimed at Gannett rather than ourselves. The SOS site was due for a retool anyway. Its initial purpose as an anti-Gannett propaganda tool was giving way to a journal that viewed Gannett actions with skepticism.
1/9/00 In order to avoid being deposed under oath, Gannett and Liberty executives and lawyers agreed to withdraw their motion demanding that the SOS suit be dismissed. It meant that the suit can go forward, which is good news, but also that it will occur some time in the future, with all sorts of potential obstacles between now and then. It's annoying not to get these guys on the stand right away, before their memories fade and their files vanish.
1/10/00 A major client, bullied by Gannett into seeking advertising options elsewhere, left a 20-year relationship with the Hawaii Newspaper Agency, taking nearly half a miliion dollars annual revenue.
1/11/00 The SF Bay Guardian cited Honolulu as a model for community support for newspapers under corporate assault: "For at least the next few months, and possibly for much longer, Hawaii will have competing daily papers. And the only reason there's not already a newspaper monopoly is that the attorney general and the unions were willing to sue."
1/12/00 Liberty-owned severs news links to the Save Our Star-Bulletin site. It's petty but not unexpected, particularly given the flap earlier in the week.
1/13/00 In a newspaper headlining CLONED MONKEYS SOON TO COME, the Star-Bulletin noted that Gannett and Liberty were asking to have suits against them dropped, claiming they were moot since the original agreement to kill the paper had lapsed. This may not preclude, however, a future, secret arrangement between the media giant and the media midget to kill the paper, this time without warning. Details, details...
1/18/00 As the Queen Mum says, we were not amused by a Washington Post story about business as usual at Gannett papers. It seemed that at the Boise, Idaho, outlet, Gannett execs didn't see anything wrong with allowing local businesses proof-read stories about them. The paper's business editor, appalled, resigned after just a month on the job. It's just "good journalism!" spun the paper's lawyers. Yikes. I don't think I'd rely on lawyers, paricularly Gannett lawyers, to define journalism for me.
1/21/00 Both Gannett and Liberty filed complaints and lawsuits in attempts to bully the state of Hawaii into a bargaining position. It was a curious development. Whilst claiming on one hand that the state's complaint is moot because there is no longer a conspiracy to murder the Star-Bulletin, they also demanded a free hand to pursue the conspiracy in the future. Liberty also sued the State Attorney General personally, claiming losses in lawyer fees -- even though Gannett had been covering Liberty's legal expenses.
1/22/00 More information from Gannett/Liberty's legal counterattacks came out, and were devilishly fascinating in the details. Gannett vice-president Larry Gasho, for example, testified that producing the Star-Bulletin costs $10.67 million every year. The cost over the remaining terms of the JOA would be something like $130 miliion, which Gannett characterized as a "loss." The rest of the world would likely think of it as an "expense." After all, the only reason that Gannett was making money at all in the Honolulu marbket was because they controlled both news cycles advertising revenues. To claim that revenue would remain constant whilst getting rid of half the product take some creative math. But then, it's all about denying customers a choice, isn't it?
1/23/00 More details. Liberty paid $10 million to purchase the Star-Bulletin in 1993 and created Liberty Newspapers Limited Partnership to manage it, of which Rupert Phillips personally owned 31.25 percent. His secretive, shadow partners were given cash payments early in 1999 by divvying up $5 million they borrowed against the investment. This raised their outstanding debt to $11,625,000 as of October 1999, the day theStar-Bulletin was supposed to die. This raised interesting questions, particularly since Phillips claimed he was forced into killing the paper by his partners, and that the market didn't support the product. Would they have taken out such a large loan against the investment -- one they claimed was a loser -- if there were no assurance of a quick payoff?
1/25/00 The Justice Department's insistance that the San Francisco Examiner sale contain significant physical assets was viewed with a great deal of interest. After all, Rupert's $10 million in 1993 supposedly bought nothing but the paper's name and a promise to receive yearly payments until 2012. Gannett hung on to ALL the physical assets, including the Star-Bulletin's copyrighted archives and photo collection. Who in his right mind would pay that kind of money to buy a paper without a library? Unless, of course, there was a tacit agreement at the time to kill the paper at their convenience. Physical assets would have made things messy.
1/26/00 The new edition of the Guild Reporter contained excerpts from Ian Lind's daily digest of Star-Bulletin. That's pretty cool. It's also an acknowledgement that this issue is of nation-wide import. It's the first time that Gannett has been publicly dogged for their misdeeds, thanks to the Internet.
1/28/00 When Save Our Star-Bulletin presented evidence that the Gannett-run Hawaii Newspaper Agency was conspiring to scuttle Star-Bulletin circulation figures, HNA president Michael Fisch lost his cool. Annoyed that the Hawaii Newspaper Guild was aiding SOS members in saving the newspaper, Fisch squealed, "If (Guild director Wayne) Cahill is interested in preserving the profitability of the Star-Bulletin, then he, as well as the other union leaders, can work with the newspaper in a more cooperative, pro-active (way) to improve the productivity of the Hawaii Newspaper Agency!" He then scuttled away in his imported car to dine at a private club.
1/30/00 As we headed into the end of the ABC audit period, the Advertiser frantically attempted to artificially boost their circulation figures. These are the guys, after all, who used to claim 10,000 papers distributed free to schools as paid circulation. When they were caught at it, the free papers to educate kids vanished.
NEXT! February 2000
It's the Racks, Jack!

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