WHISPER: AnnArbor.com Executive’s “Explanation” of Recent Layoffs From Site

A2Politico Notes: This is filed under “Scoops & Scores!!” because you read it here first.

The common definition of “omertà,” from the southern Italian dialect, is “code of silence.” To depart from omertà results in swift and sure retribution. Omertà applies not only to those who are directly involved in the three Italian mafias (La Cosa Nostra/Sicilian; N’Dragheta/Calabrian, Camorra/Neapolitan), but also those who might be indirectly involved, such as witnesses.

On Friday March 11, 2011, A2Politico posted a piece about the layoffs of newsroom workers and paid bloggers by the local news blog AnnArbor.com. I got a tip and followed it up. I got a tip that AnnArbor.com would lose Stefanie Murray, Amalie Nash and David Jesse to the Detroit Free Press, as well. I posted an entry about that staffing change at AnnArbor.com.

In December 2009 and December of 2010, I included AnnArbor.com in posts I wrote about the readerships and reaches of our local media. I wrote the December 2009 piece, in part, because AnnArbor.com’s Kontent King Tony Dearing, and his colleagues Matt Kraner and Laurel Champion gave “Marketplace” reporter Jennifer Guerra the brush-off when she asked them to comment on the record about how the site was faring. It was a similar story when a writer from the Ann Arbor Observer did a piece about the plight of the Ann Arbor News, and then-publisher Laurel Champion refused to comment. I wrote this in my December 2009 post:

Part of the AnnArbor.com business model is aimed at having Ann Arbor readers feel a sense of community, and feel ownership of the site. In fact CEO Matt Kraner was quoted as saying this prior to the July 2009 launch: “It is the perfect place to embark on a Web-focused news and information strategy,” Kraner said. “We will be working with Ann Arbor’s residents and advertisers to build a unique and innovative community news and information service.” However, for management to be closed-mouthed about whether or not the site’s readership is growing, and whether circulation of the twice weekly is holding steady, growing or declining, seems like circling the wagons to protect the product. Is the site/paper combo so fragile that Dearing, Kraner or Champion didn’t dare say a word about their company’s health to reporter Jennifer Guerrra?

As it turns out, that observation was prescient.

By December 2010, it became clear that there was some major spin/damage control going on at AnnArbor.com concerning the site’s readership, the paper’s circulation, and AnnArbor.com’s reach (reach is publisher-speak for market penetration—how many people in a market interact with the publication or news site). Between July 2009 and July 2010, the paper lost 10,000 print subscribers, or about 22 percent of its readership. That’s a body blow.

Meanwhile, Dearing and Kraner were telling national media different stories about the site’s reach. I wrote in December 2010:

AnnArbor.com’s online numbers have been difficult to pin down, as well. In December 2009, Tony Dearing told A2Politico that the web site hosted 170,000-200,000 weekly unique visitors and 630,000-650,000 unique monthly visitors. In July of 2010, Tony Dearing and CEO Matt Kraner told various journalists conflicting stories:

In an interview with media analyst Rick Edmonds, who writes the well-respected PoynterOnline, Tony Dearing was quoted as saying that AnnArbor.com “gets 50,000 unique visitors a day.”

According to a July 26, 2010 post to editorsweblog.org, compiled by the World Editors Forum, AnnArbor.com President and CEO Matt Kraner presented AnnArbor.com’s numbers thusly: Web traffic is steadily growing, Kraner told the Tribune, with 209,000 unique visitors per week.

Then, in that December 2010 piece I made this prediction:

Over the next 12-16 months, unless AnnArbor.com turns a reliable profit, it will be shuttered….

Will it turn a reliable profit?

I don’t believe it can generate the kind of profit margin the old Ann Arbor News did at the height of its profitability, in the early 90s. It’s a combination of the fallacy that AnnArbor.com was something “new,” a grand invention, and that Advance Media executives mistakenly chose three people to run the business, none of whom had extensive experience in online digital media. As a result, their marketing and editorial methodology has been imprecise, and the company often comes off as run by the seat of its pants. There are some editorial bright spots (Tony Dearing’s well-reasoned…mostly…editorials, David Jesse’s education coverage, Nathan Bomey’s business coverage…usually), but not nearly enough bright spots. Unless AnnArbor.com begins charging for online content to compensate for lost subscriber revenues (and they can’t do that successfully, because loads of their content comes from wire services), they don’t have enough quality content to bring in the revenue they need to survive.

Ninety days later, AnnArbor.com lost David Jesse and two others when they jumped ship, then one week after that cut 14 staff members, and fired most of its paid blogging contributors, leaving it with a newsroom that is one-quarter the size of that of the Ann Arbor News just prior to its closure. Now, content production becomes more difficult and complicated.

I am the Publisher of a national higher education publishing group. We publish books, and an online news magazine that serves 159,000 college faculty. We went digital six years ago, and I got all of my gray hair in that year. We lost 30 percent of our print subscribers and several long-time advertisers who, in 2004-2005, didn’t understand digital publishing, or have a line item in their marketing budgets to include online advertising. My plan was to minimize advertising revenue and move to pay-for-view journalism. In 2004-2005 that was heretical. Today, that kind of thinking will get you $1 million dollar grant from the Knight Foundation.

I have a disquieting tendency to enjoy change, and to sometimes be slightly ahead of the curve. It’s a blessing and a curse. Be that as it may, it’s a diabolically hard time to be a publisher of anything. There is no shame in having a difficult time in this economy, or in this particular industry.

So why is the trio in charge of AnnArbor.com acting like capos of a local chapter of the N’Drangheta? A2Politico, Michigan Radio, and I’m sure in the following weeks other blogs and news outlets will write about the layoffs at AnnArbor.com. AnnArbor.com, however, did not cover the loss of Jesse, Murray or Nash, and did not report on the severe cuts made to its own newsroom staff. More disturbing still, in the comment section of a piece by AnnArbor.com’s Nathan Bomey posted concerning possible layoffs at Border’s, Tony Dearing posted this in response to a reader question about the layoffs:

“While personnel issues are an internal matter and we don’t discuss them publicly, I can confirm that we reorganized our newsroom this week to put our focus more squarely on local news coverage. As a new organization, we have tried a lot of things. Now that we are well into our second year, the community has told us very resoundingly that what it wants most from us is hard news coverage, particularly in the areas of government, education, police, courts, health, the environment, University of Michigan sports, and business. These areas of coverage account for all but a tiny percentage of our readership and revenue. Meanwhile, we also have put a lot of effort toward other things — including lifestyle topics like Passions and Pursuits, The Deuce, Homes and some areas of Entertainment coverage — that our community has shown much less interest in, and we are scaling back in those areas.

“We have made tremendous progress since we launched, and we continue to be very happy with the growth we’re seeing in audience and revenue. But from the beginning, we said that we would be shaped by what the community wants, and the community wants us to focus more sharply on local news reporting. We have repositioned ourselves to throw our energy and resources into our local news coverage and that is how we will operate moving forward as we continue to grow.”

There are multiple pleas from readers posted to various articles on the site prodding Dearing to provide an explanation concerning the layoffs and “reorganization.” Thus far, the answer from those in charge at AnnArbor.com has been continued omertà. In case you think this is normal, it’s not. It’s downright weird and a little creepy. From the CIA we would expect more transparency. From a news organization what can we reasonably expect?

Here is a sampling of columns/posts about newspapers that have within the past year or so covered the news of layoffs in their own organizations. The papers are big and small, and located in every corner of the United States. What these news pieces have in common, you’ll note, is a quote from the executive in charge and a clear explanation of why the layoffs were necessary:

With the recession continuing to take its toll on newspaper and advertising sales, The Record announced Thursday the layoff of 12 employees from its staff of about 295.

As a subsidiary of Dow Jones and News Corp., The Record does not separately disclose profit or loss figures, said Roger Coover, publisher and president.

However, he said, “With an extremely slow economy, with retailers going out of business, obviously our advertising revenue has declined some. It’s the same with readership in the sense that we have 10 percent of the households in foreclosure or already vacant. With 15 percent of the people unemployed, people are deciding, ‘I need to cut every corner that I can.’ “

The Montana Standard announced Monday it has laid off two full-time and four part-time employees due to a consolidation of circulation customer services and the flagging economy.

The Standard will be partnering with the Helena Independent Record, Casper Star Tribune in Wyoming, the Missoulian and the Billings Gazette to open a centralized circulation customer service call center in Billings.

Circulation calls for missed papers and starts and stops of paper subscriptions and general customer service needs will be handled at the call center. The transition will take place over the next couple of months.

The Standard will maintain it’s customer service department for more pressing customer issues on the first floor of the newspaper offices, 25 W. Granite.

The Standard, as have many other newspapers across the state, is also facing a downturn in national advertising. That is forcing some of the layoffs as well. This is the second round of layoffs at the Standard. In September, six employees were laid off due to consolidation of work offices and the economy.

“The centralized circulation call center will be a benefit to customers and our staff as well, so that we can focus on critical issues customers may have,” said Publisher Janet Taylor.

The Dispatch is reducing the size of its newsroom, laying off 45 people effective on April 3, management of the newspaper announced today.

“These are challenging times for many industries, including the newspaper industry,” said John F. Wolfe, publisher and CEO, who explained the changes to the staff.

“We avoided staff reductions as long as possible long after many other news organizations took such action.”

While the newspaper readership remains strong and stable, Wolfe said the economy and market forces have pushed advertising revenue steadily downward. And advertising revenue provides the majority of funds needed to pay salaries and buy paper and ink.

The Denver Newspaper Agency laid off 40 people today, a move that marks the beginning of a 200-person reduction to take place over the next several weeks, according to the DNA.

The reduction is partly an effort to resize the workforce after the closure of the Rocky Mountain News in February.

The DNA was formed in 2001 to run the business operations of the Rocky and The Denver Post after the companies agreed to a joint-operating agreement.

“These actions will help us shape a new business model that will allow us to adapt to new market realities,” said Gerald Grilly, DNA president and chief executive. “We are not just ink on paper anymore; we are true information providers across many platforms. The new shape of our industry demands that we work leaner and smarter to serve our customers.”

The Houston Chronicle is laying off approximately 12 percent of its employees in an effort to reduce costs amid unprecedented change in the newspaper industry, Chronicle Publisher and President Jack Sweeney announced Tuesday.

“As our newspaper continues to report the condition of the economy, we read about companies in all business categories adjusting their size to match current and projected revenues,” Sweeney wrote to Chronicle employees. “The Houston Chronicle must do the same in spite of your diligent efforts.”

Short URL: http://www.a2politico.com/?p=6413

18 Comments for “WHISPER: AnnArbor.com Executive’s “Explanation” of Recent Layoffs From Site”

  1. […] to Dearing’s obtuse stonewalling also come a day late and a dollar short. Dearing has a pattern of covering up for himself and for AnnArbor.com. The habitual “disingenuous behavior” Morgan complains about is standard operating […]

  2. great website! I only found you the other day but I loved reading this post. Keep up the great work.

  3. http://www.rbr.com/radio/radio_deals/ann-arbor-am-headed-for-new-owner.html?print?print

    Details from the Radio & Televsion Business website which mentions a down payment of cash and a promissory note.

  4. “The newspaper scam. It’s more than an online paper: It’s a pile of illiterate crap.”

    Jack Lessenberry

  5. […] AnnArbor.com WHISPER: AnnArbor.com Executive’s “Explanation” of Recent Layoffs From Site WHISPER: AnnArbor.com Executive’s “Explanation” of Recent Layoffs From Site Posted 1 day […]

  6. We’ll see if Lucy Ann Lance and company end up doing a morning show in the next few months, since they ‘rent’ time anyway (or so I’m guessing) on their current station and guessing Mrs. Thayrone has already been working on that.

  7. Pat, I’m a radio junkie and station values nationwide have fallen into the toilet the last two years. Something about, no one listens to the radio and are being amused with other toys, like iPods, cell phones, video, the net, la la la. The last time this startion sold, it went for $1.5 Million a few years back, and the current owner got it as a buy out for a radio group he previous was president of. It sold to Thayrone and wife for $1 Million. Guessing either they came up with a percentage (25%) and the owner is financing the remainder on a land contract or some local bank did it to keep the hate radio flowing. Guessing you haven’t listened to Mr. Thayrone’s show lately. BUT having said that,kudos for his hard work and making this happen–bringing WAAM back to local ownership. That, in the long run, is a great thing. Good news, bad news. But from all I read on radio, this was probably WAY overpriced in comparison to reality values. But I wish them luck.

  8. @Alan, some of the readers here might enjoy right wing media crap. Some of the readers might enjoy left wing media crap. I want to know where Thayrone and his wife got $1 million bucks and which local bank financed this deal.

  9. Scoop:

    “• Coolarity A2, LLC is purchasing talk WAAM AM 1600 Ann Arbor from Ann Arbor First Ventures LP for $1,050,000 pending FCC approval and closing. The sale will put the station in the hands of an independent local owner for the first time since 2003 when Lloyd Johnson sold the station to First Broadcasting Partners.

    The new owner is the current station general manager Linda Hughes, who in a statement commented, “Ownership of WAAM is an exciting next step for me personally and for the station. I am proud of the show lineup and features we’ve been able to bring to WAAM and I am thrilled about the future possibilities for WAAM to better serve our local communities and local advertisers.”

    Hughes is married to Thayrone, host of WAAM’s afternoon show “On The Edge With Thayrone”.


    Great more half ass, right wing media crap pouring over the airwaves locally.

  10. @A2Politico I think the comment was *moved* between posts without any indication that it had been done.

  11. @Ed & TD: Thanks for the heads up. Dearing’s comments were not there when I looked multiple times this morning. The other oddity is that his comment was never the first in the line of comments. There were several before it, his, then, Ruth Kraut’s comment. Maybe there was a software glitch. Maybe they put it back. I’m glad it’s there now. I’m sorry it’s not a full blown explanation.

  12. I found it very curious that the only explanation of A2.com “reorg” was in response to comments on the Borders layoff story. For a news organization, who demands transparency, and purports to be “part of the community,” this is odd behavior. I believe readers should be provided with the truth, no matter how unpleasant it may be. We’re all in this together. We’re all grown ups, and we all need credible news organizations. My 2c.

  13. I understand AnnArbor.com might be hesitant to disclose too much about their current situation, especially if it is somewhat tenuous. At the same time, they are missing a really good opportunity to control, or at least frame the discussion of the layoffs. Not mentioning the layoffs and the loss of 3 reporters to the Freep seems dodgy in the end, like they are hoping nobody will notice.

  14. Thanks for this coverage. I was pleasantly surprised for a while with AnnArbor.com’s advent and a number of changes they made, including bringing on Ed Vielmetti. It got confusing after a while but it is still the only actual daily news medium that we have in Ann Arbor. The Observer has some good stories but the timeframe is too long for immediate coverage of events, the Chronicle has excellent coverage of some things (I’m sooo glad for their government coverage) but is also not set up for rapid response to moving events. As you point out, the loss of reporting staff is a major concern. What does it mean that our community can’t support a real news”paper”?

  15. FYI – TD’s comments are there. Thank you for covering this.

  16. Pat, everyone here is way too polite:

    “The newspaper scam
    It’s more than an online paper: It’s a pile of illiterate crap.”

    Jack Lessenberry


  17. Patricia,

    This would be a fantastic story, if it were true; yet, when I look at the page


    right now, I see the comment in question and it hasn’t been removed or deleted.

    It’s possible that you may have confused a momentary software glitch with something more important.

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