Broadly wrong to go non-profit

By William E. (Bill) Garber

This from the Hollywood Reporter–It looks like money man Eli Broad (of KB Homes fame and a Michigan State University grad who qualified for in-state tuition by reason of birth) and Austin Beutner (not the B in KB homes but an investment banker and former deputy LA mayor) would like to acquire the LA Times and turn it into a nonprofit.  Click Here for article.

I would have expected businessmen to be thinking how to make a profit, but nooooo! Broad and Beutner apparently aren’t interested in a business, only a platform it looks like, and they apparently want to be sure they can deduct every penny they invest, perhaps right from the first one.

Citizen Cain would be vomiting. (If you have ever visited San Simeon, the amazing castle built by William Randolph Hearst, aka Citizen Cain, one thing is totally clear. While the State of California was gifted this historic property, it not only would not, but it could not have built it. And it is today as dead as it could possibly be. Nothing left but an architectural Rorschach test for an endless stream of visitors.)

Non-profit newspaper is an oxymoron.

Ben Franklin is averting his eyes from the grave.

While these two may financially sink a great LA newspaper, 20% of community newspapers licensing Interlink software and services grew their circulation last year, with virtually no help at all from outside their home town. We at Interlink are now focusing on how to help them and the other 80% aspiring to be like them to improve their profits and their equity by deepening market penetration.

Conversations are sure to follow.

Publisher:  Jack. Your ads mean a great deal to our community and to our newspaper, and I surely trust to your business as well! How are things?

Jack the advertiser:  Not too bad, actually. And you?

Publisher:  Things are going well for the newspaper these days, too. And that is something of a problem for us and obviously an opportunity for you. Our circulation is up by 10% in the last year, in fact the last several months. As you can imagine, when the circulation is up, our expenses are up. Not only are we printing more copies, our postage is up on all of our papers. Fortunately we are going to be able to keep things in hand by raising our ad rates only 5% next month.

Jack the advertiser:  Higher ad rates always gives advertisers pause. I can see how a bigger audience can help us. But I sure would like to keep within my budget for the year.

Publisher:  Let’s see if we can get through the rest of the year with changing the ad sizes now and then, and sharpening the targeting to increase revenue from the larger audience. Together we can both do better this year still, and set ourselves up for an even better year in 2014.

So, maybe it is time to say good bye to the LA Times … and hello to a bigger, more profitable paper in the town where you live and publish.

That’s the way it is supposed to be!