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Tribune included in family newspaper group

NEW YORK (AP) – While many newspapers are cutting costs to keep investors happy,a small group of family-owned publishers is hoping to offer smaller papers like the Tahoe Daily Tribune an alternative to the pressures of public ownership.

Plans for the nine-member group, the Family Newspapers of America, have been in the works for nearly two years, but the March 16 announcement of its official formation earlier this month came at an intriguing time for the newspaper industry.

Large media and newspaper groups, hit by a slump in advertising and rising newsprint costs, have been trying to preserve profit levels by trimming expenses including, in some instances, reducing staff. Some newsrooms have resisted the measures and, in one instance, publisher Jay T. Harris of the San Jose Mercury News resigned to protest profit goals set by the paper’s corporate parent, the large newspaper group Knight Ridder.



Knight Ridder has revised its financial targets for the newspaper in

response to Harris’ concerns, and has pledged not to cut jobs there. But




the issue lives on at another Knight Ridder paper, the Akron Beacon

Journal, which faces staff cuts amid a worsening business environment.

The leaders of the family publishing group are pledging to share resources and say that cutbacks during hard times are the kind of changes they would hope to avoid for the newspapers they plan to acquire.

”The whole issue of profitability is radically different in our companies,”

said Richard K. Larson, a spokesman for the group and chairman of Swift Newspapers in Reno. ”We want to take a long-term

view.”

”As one of our members put it, public companies think in terms of quarters, and we think in terms of decades,” said George Wilson, CEO of Newspapers of New England in Concord, N.H. and another spokesman for the group.

”We are not critical of publicly held newspaper companies, but we think there is a difference.”

Wilson said the group would seek to offer competitive prices for family-owned newspapers that come up for sale, but with a promise to stick with

principles of strong coverage of local news, a long-term commitment to their community and staff and other tenets of independent ownership.

The group will focus on newspapers of about 25,000 to 75,000 circulation.

Industry executives and analysts say the group’s pitch could have a

certain appeal. George E. Randall, editor and publisher of The Frederick

News-Post in Frederick, Md., recently bought out his mother’s side of the

business, making him the fourth generation to keep control.

Randall said he would consider an offer from the group if his family ever

decided to sell, but he also cautioned that the management style of future

owners is just one consideration for a potential seller.

”I think it’s going to be a very interesting and worthwhile experiment,”

Randall said. ”They say they’re in newspapers for the long haul, and

that’s good.”

Often, families are driven to sell newspapers for similar reasons they

sell other private business – steep estate taxes, disagreements among

shareholders, or the lack of an heir.

John Troutt, a family publisher in Jonesboro, Ark., sold his family’s newspaper last fall because his sons were involved in different businesses. He said the decision to sell the paper, which had been in his family for 99 years, was driven mainly by economic reasons.

”We would have considered anybody at that time, but we would not have

left a lot of money on the table,” Troutt said. ”Honestly, I don’t think you can ever predict what any owner is going to do.”

John Morton, an independent newspaper consultant in Bethesda, Md., said the family group would be most likely to appeal to closely-held family

papers that can give strong consideration to the type of ownership of a

potential buyer.

But he also cautioned that the group was likely to face its own challenges

of making enough returns on its investments in order to service any debt

it takes on, as well as retaining its family ownership culture even as it

expands in size.

Wilson says the family principles are the whole reason for the group to

remain together. ”I would think the whole thing would fall apart on its

own if it abandons its founding principles,” Wilson said.

Economic forces such as higher production and newsprint costs have led to a consolidation of newspapers over the past decade as large group publishers such as Gannett Co. and Knight Ridder bought up smaller

properties.

Morton estimates that there are currently about 250 family owned papers in the United States, and another 50 or so family-run companies that own more than one newspaper, compared to 358 family newspapers and 75 family groups 10 years ago.

For their part, industry giants Gannett and Knight Ridder both welcomed

the formation of the group. ”Many members of the group are friends and we wish them well on their new endeavor,” Gannett chairman Douglas H.

McCorkindale said.

”If the existence of this new group helps people in some way to make a

difficult decision less complex, it will serve worthy purpose,” Knight

Ridder spokesman Polk Laffoon said.

In addition to Newspapers of New England, the other members of the family group include Swift Newspapers in Reno; the Times Publishing Co. of Erie, Pa.; The Scranton Times of Pennsylvania; Gazette Communications Inc. of Cedar Rapids, Iowa; Calkins Newspapers of Levittown, Pa.; American Republican of Waterbury, Conn.; The Spokesman-Review of Spokane, Wash., and The Eagle-Tribune company in North Andover, Mass.

Besides the Tribune, Swift papers in the Tahoe area include the Nevada Appeal, Sierra Sun, Tahoe World, Incline Village Bonanza and the Record-Courier.


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