Ex-Gannett publisher: ‘bottom line didn’t work’

A reader challenges my view, in a comment here, that Gannett papers subject to sale in a restructuring are “vulnerable.” Look at what’s happened at the Observer-Dispatch in Utica, N.Y., the reader says, since GCI sold it to GateHouse Media less than a year ago.

In a column last fall, Publisher Donna Donovan said the paper was prospering anew, after returning key customer-service jobs to Utica that Gannett had consolidated at distant call centers.

“To get to the bottom line — the bottom line didn’t work,” Donovan wrote. “It was costing us more to out-source these operations, and others, than to run them ourselves. Plus, we knew in our hearts that our customer service would improve, our classified ad sales would grow, and a whole host of other parts of our operation would be better run if they were here. And now they are.”

(Confidential to Corporate: The Observer-Dispatch is still listed as a Gannett newspaper, on this official company page.)

Anyone else have examples of how the new call centers are performing? Use this link to e-mail feedback; see Tipsters Anonymous Policy in the sidebar, upper right. Or leave a note in the comments section, below.

[Image: this morning’s Observer-Dispatch, Newseum]

9 Responses to “Ex-Gannett publisher: ‘bottom line didn’t work’”

  1. Anonymous Says:

    Do you have financials to back up “prospering anew?” Have you looked at the Gatehouse financials and stock?

  2. Anonymous Says:

    The financials and stock for Gatehouse don’t reflect what’s happening at their newspapers. Circulation is up in most markets, as are unique visitors and page views for their online sites.

    Gatehouse has told Wall Street to take a leap because it is reinvesting in its resources and people, thus the financials and stock price might not look too rosy.

    Gatehouse is in it for the long term, not trying to cut its way to prosperity.

  3. crip1965 Says:

    Hmm. Is “Anonymous” a sock puppet for a Gatehouse employee? Unique visitors and page visits don’t directly translate into higher revenues, as with the exception of the Wall Street Journal, no newspaper has figured out how to generate significant revenue online.
    As to “reinvesting in resources and people,” Gatehouse continues to cut staff nationally, but especially in Illinois, at the largest newspaper the company owns, the Peoria Journal Star, and the State Journal-Register in Springfield, the state capital. As far as “investing in resources,” if that means cutting newsroom resources and services, by all means, Gatehouse is “investing” and not frantically trying to pay off the enormous debt it incurred during its orgy of acquisition in the late 90s and early 00s, which continues somewhat today. If everything was so rosy at the individual newspapers it most certainly would be reflected in its stock price. Gatehouse is in it for the long term only as much in that after it wrecks the place by cutting news services to the bone and squeezes every last drop of revenue above a certain outrageously high rate of return for a newspaper it will be sold. Check out the Gatehouse entries at http://www.peoriapundit.com for bonafide verifiable sources, “Anonymous.”

  4. Rottenchester Says:

    I run a blog covering a congressional district (NY-29) served by Gannett and Gatehouse papers. As a consumer, I see more (and better) local reporting in the Gatehouse papers. Considering that the circulation of the main Gannett paper (the D&C) is 10X that of the Gatehouse papers, it’s remarkable how much worse the Gannett political reporting is.

    Also, on the Internet Gatehouse is slowly moving them to their standard CMS, which is better than the hodgepodge that those papers used to use.

    From what I see, Gatehouse seems to be able to acquire local papers and improve the parts that are hard for local papers (e.g., web presence) while leaving editorial pretty much alone.

  5. Anonymous Says:

    Better journalism from Gatehouse? You have got to be kidding me. Their newsrooms are being slashed faster than anything you’ll see at Gannett. CEO Mike Reed is doing the same thing he did to CNHI papers when he was their CFO – squeezing every dime out to raise the profits to obscene levels. I’d be interested to read how journalists from Gatehouse papers view their futures.

  6. Anonymous Says:

    Let’s focus on this one example of Utica, N.Y. The publisher, who was — best I can tell — a lifelong Gannett manager, watched her paper get gutted by Gannett as it consolidated operations into Binghamton (and India, and its “Center for Excellence” and its “Regional Toning Center”). When Gannett realized Utica was too far from its consolidated press facility in Binghamton, Utica was “vulnerable” (as Jim might say) and subsequently sold to GateHouse.

    Only the people in Utica can speak to newsroom layoffs in the past year, but under Gannett, the newsroom was shrunk significantly. What we do see, without talking in abstracts, is tangible evidence that GateHouse is investing in all aspects of Utica’s operations, at least if we’re to believe the ex-Gannett publisher’s annual “State of the O-D” column, which she wrote just a month ago. There’s more to the health of a newspaper than simply its newsroom FTEs.

    Jim, there’s a lot of misinformation about GateHouse here. I’d be interested if you’d reach out to this publisher and see if she’s willing to set the record straight about just what happens to a formerly-gutted-by-Gannett newspaper once it’s been purchased by GateHouse. It might give us new insight into what’s happening behind the scenes at Gannett.

  7. Rottenchester Says:

    Anonymous: “Better journalism” is a relative judgment, but, yes, it is better. For example, the small-town papers have 10-20 year veteran journalists who have a sense of history that helps them put stories in context. The Gannett paper (D&C) has gutted its newsroom while focusing on its Internet properties. It’s not that the Gatehouse papers are such shining examples, it’s that they are better than the diminished Gannett product around here.

  8. Jim Hopkins Says:

    A reader commented, above: “I’d be interested if you’d reach out to this publisher and see if she’s willing to set the record straight about just what happens to a formerly-gutted-by-Gannett newspaper once it’s been purchased by GateHouse. It might give us new insight into what’s happening behind the scenes at Gannett.”

    Good idea! I’ve sent the publisher, Donna Donovan, an e-mail, asking her to chime in.

  9. Anonymous Says:

    They tried to position the call center jobs as sales jobs, with commissions for upgrading service, collecting payments, etc. The problem is, folks looking looking for commissions are not that interested in the routine, commission-free, customer calls, and the customers know it. Just ask your telephone operator or the circ director’s secretary how many calls they get from people who couldn’t navigate the voice response system or were treated badly when they did get to a person.

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