A TALE OF 2 MOVIES – THE INSIDER AND THE OUTSIDER

New L.A. Times publisher misunderstands ad-edit principles

Last week a Hollywood movie, The Insider, opened. It is the semi-fictional story of a tobacco industry whistle-blower and the television news producer who fought to get the whistle-blower on the air.

The movie could be called a morality play about the stresses and confrontations that occur when workers decide whether they have a greater loyalty to their jobs or to their principles.

The week before, another morality play spun out across town from Hollywood. This is the true story of a recently anointed newspaper publisher who, if not concocted, at least approved a scheme where the newspaper shared revenues from a special magazine section with the subject of that section, keeping the editorial department in the dark about the arrangement. If this story were a movie, it would be called The Outsider.

You know what I'm talking about: Los Angeles Times Publisher Kathryn Downing OK'd a deal to share profits from a special edition of the Los Angeles Times Magazine featuring a new local sports arena with the arena itself. The Times was and is a "founding partner" of the Staples Center, which gives the newspaper exclusive marketing rights in the arena – as well as use of a luxury suite. The cost to be a founding partner is $2.75 million to $3 million a year. Downing hoped to pay down some of that agreement by sharing the profits of the Staples Center special section with the Staples Center itself.

A local alternative paper, New Times (part of the nationwide chain of weeklies based in Phoenix), found out about the arrangement (interestingly, the writer buried the information way down in a long story about skirmishes between editorial and advertising) and shortly thereafter the national press pursued the story.

An editorial staff revolt then ensued, with a petition signed by 300 staffers demanding Downing apologize, which she did in a meeting with staff as well as in the newspaper's own columns the next day. Downing attributed the problem to her own misunderstanding of editorial principles.

"It was my fault," Downing told the Associated Press (the Times declined to be interviewed for this story). "I thought because of the line between the business and editorial sides there was no reason to disclose it."

This was all set against a backdrop of a fostering of cooperation between editorial and advertising by former Times publisher – and Times Mirror Co. chairman and chief executive – Mark Willes. Willes, of course, came to Times Mirror in 1995 after a successful career as a banker and corporate executive, and readily admitted he didn't know anything about newspapering. Further complicating matters, Downing – a lawyer by training – came to the Times from the legal and on-line publishing worlds, not from newspapers.

As the New Times writer said of Downing's and Willes' predecessors, "They may have been business-side boobs, but they also had printers' ink in their veins."

On Oct. 29, Downing sent out a "message from the publisher" saying that the paper was reviewing all existing agreements to ensure that there are no other revenue-sharing schemes, that all "non-routine" advertising projects will be reviewed before they are discussed with editorial, that written policies defining editorial independence will be developed, that "special awareness training" will be provided to business-side workers, that Downing will spend more time with journalists "to gain a better appreciation of their efforts," and that she will work more closely with Editor Michael Parks to prevent further conflicts of interest.

Oh, and they'll pay the Staples Center by check from now on.

The back story of The Insider is that the TV network was up for sale and didn't want to risk a lawsuit that might scotch the deal. The back story of The Outsider is that despite a well-intentioned effort to break down the walls between editorial and advertising, there was nobody on the destruction crew who knew anything about journalistic principles.

– David M. Cole

Inside ...

• Wall Street analysts find uniformly record earnings results 'boring'
• Journal Register reports record but other earnings not as cheery
• Cooperation with markets, stores cited as circulation gainers
• Washingtonpost.com to evolve into 'definitive' consumer resource
• Goss $225 million debt to be restructured; quick Chapter 11 exit
• Are our web sites too difficult?
• Persons

From NEWSINC., Nov. 8, 1999, Copyright © 1999, The Cole Group. All Rights Reserved.