Lee to manage BH papers

Could you expand on that?

 

How quick until they start laying people off?

 

To me, this is Berkshire-Hathway paying some money for Lee to consult. They are paying $5 mill a year (drop in the bucket money for that company) to see how they do their digital stuff. Then, BH takes that, starts buying off Lee papers because Lee has a ton of debt. I feel like Berkshire-Hathaway is baiting Lee right now and Mary Junck took the money and ran. Warren Buffet is too smart for this. He knows Lee's business plan and it's not good. Seems like good news for Lee now ... but in the future, I feel like BH has baited them and it's their hand to deal because Lee can't lay people off with this and BH still has editorial control. "strategic decisions will be agreed upon jointly." "BH will retain editorial control." ... or maybe I am just holding out hope that Lee isn't taking over with it's just awful policies because Mary Junck is awful.

 

I don't think Buffett is interested in acquiring more papers. He is pretty down on them and doesn't mention them in his annual letter. This is what Fortune wrote a year and a half ago:

 

My guess is Lee will run BH Media for a year or two, and then Buffett will sell the properties to Lee. Buffett isn't investing any more money into an industry with no growth possibilities.

BH Media has rarely gotten involved with its properties as far as editorial control. I worked for BH Media for 18 months as an editor, and the only time I heard from the corporate office in any fashion was when web numbers were up or down. They really left their properties alone, on the editorial side. Any meddling came from publishers (although, in my case, I worked for two publishers who generally left me alone to do my job).

BH Media, and I imagine Lee, care about the money. That's what they focus on.

 

Also worth noting: I doubt you'll see a lot of cuts on the editorial side. Most of BH Media's papers are former Media General properties that were gutted, and BH Media slashed more jobs within the last year or two. Maybe some of the bigger papers -- Greensboro, Winston, Richmond -- lose a position or two, but most of the small papers are barebones operations with small sports staffs, or in the case of Danville, Va., no sports staff.

 

As burnswhenIpee noted, Lee has done many of the same nasty, repugnant cost-cutting moves as other large newspaper chains: slashing employees, sending layout and design to a handful of hubs, common pages in several different neighboring publications (the Lee Montana papers are notorious for this).

Hopefully for anyone at the BH papers, these types of moves already have been done.

 

I thought I read that after the latest cuts Greensboro was down to an editorial staff of around a dozen. Is that true? Is Danville going to hire someone or has the sports department definitively been abolished?

 

Slashing has happened. Layout and design for some papers has gone to hubs in some places but definitely not all. We still do our layout in Tulsa, and we handle Waco's. College Station still does their own. I believe Richmond still does its own. Omaha definitely does its own. Common pages happens some but not a lot (I think; not super-familiar with our east coast properties).

 

The Waco paper isn't designed in Waco?

 

Nope. We've been designing it here in Tulsa for a year or so now.

 

Per Romenesko - Lee executive compensation up 28 percent while net income down 21 percent.