C o a l - necessary to send a reporter to cover the local college football games. But everyone seemed happy with the arrangement. The owners paid their country-club dues, employees paid their union dues, and no one complained that the price of monopoly, in Wilkes-Barre at least, was mediocrity. When the second generation of Times-Leader owners sold their monopoly to Capital Cities for a reported $10.5 million last May, they were being overtaken by another trend—this one toward chain ownership. Today, chains own 60 percent of the daily newspapers in the country and account for more than 70 percent of daily newspaper circulation. As monopoly was a more profitable way of doing business than competition, so chain ownership has proved to be an even more efficient system for wringing profit from newsprint. With the capital resources to provide the most modern technology, the muscle to wrestle labor unions, and a homogenous news product that, like fast food, is convenient and well packaged, newspaper chains make family ownership —even in monopoly towns—look like a primitive form of capitalism. Capital Cities is a newcomer to the newspaper business (it acquired its first daily in 1969) and a relatively small chain by current standards (it owns only six daily papers). But it is one of the fastest growing media corporations in the country. The graphs in its annual report, with their steeply ascending bars, tell the corporate story: in the past ten years, annual revenues have grown from $72 million to $306 million, and profits have climbed from $9 million to $43 million a year. In 1976, according to a report in Barron’s, its profit margin was the highest of any publicly owned newspaper group. The company was founded in 1954, when a group of investors, including Lowell Thomas, bought a near-bankrupt television station in Albany, New York. Today, Capital Cities owns six television stations (including outlets in Philadelphia, Houston, and Buffalo) thirteen radio stations, twelve trade publications (Women’s Wear Daily, Daily News Record, W, and nine other Fairchild papers) six medical magazines, and six daily newspapers. (The papers are The Kansas City Star and The Kansas City Times, purchased in 1977; the Fort Worth Star-Telegram; the News-Democrat in Belleville, Illinois; The Oakland Press in Pontiac, Michigan; and the Wilkes-Barre Times-Leader. A bid to buy the Hartford Courant for $70 million was rejected by that paper’s stockholders in November of 1978. Like most newspaper chains, Capital Cities rationalizes the loss of local autonomy by claiming that is superior resources and higher professional standards enable it to improve the quality of the papers it buys. “ Let’s face it,” says company president Daniel Burke, “most family-owned newspapers are quite bad. The idea that a family can run a good paper is about as statistically sound as the notion that the fourth or fifth generation of a royal family can still provide effective leadership.” The Wilkes-Barre Times-Leader, as viewed from corporate headquarters on Madison Avenue, was proof of Burke’s law. “ I saw a copy of the paper two days after we bought it,” says Richard Connor, “and I said, ‘That’s a lousy newsp a p e r .’ The reporting was not aggressive, their approach to display of news was outdated, and there was a lack of sophistication at every level.” If Capital Cities has the sophistication to publish a better paper in Wilkes-Barre, it hasn’t yet become evident. Before the strike began, the logo was enlarged, the format was changed from eight columns to six, photographs were used more frequently, and a new editor from Fairchild’s Footwear News stepped in. Despite these cosmetic changes, the quality of the paper was unaffected. Almost all front-page stories, both before and after the takeover, were Associated Press dispatches. Aggressive reporting remained in short supply for a city where indicted Congressman Daniel Flood is a folk hero and there is no shortage of homegrown scandal. After four months of Capital Cities ownership, the Times-Leader was essentially the same unsophisticated paper — a medium for funeral notices, bowling scores, and supermarket ads. One reason the new owners may have accomplished so little during this time was that they were preoccupied with developing a labor strategy. In their eyes, union featherbedding was the biggest obstacle to editorial and financial progress in Wilkes-Barre. Not only did existing work rules sap the company’s profits, Connor claims, but they encouraged unprofessional practices. Among these, he says, were nepotism and a blurring of lines between editorial and business functions, brought about by the practice of paying some reporters commissions for selling advertising on the side. “There isn’t another contract like this in the country ,” Connor exclaims, waving the little, fortyeight-page, beige booklet with the words “ Guild Contract” on its cover. He ticks off management’s grievances: unlimited sick leave, inflexible and costly overtime rules, the inability to hire or transfer employees without union approval, mandatory severance pay regardless of the cause for dismissal, and the financing of employees’ cars. By agreeing to the terms of the contract, Connor says, the old owners gave away control of their paper to the unions. Capital Cities wanted it back. “ Certain rights inure to the fundamental concept of entrepreneurial control,” the company stated somewhat infelicitously in a position paper released November 1, “ and we feel that recognition of this fact is necessary and proper.” Union leaders dispute Connor’s contention that the Wilkes-Barre contract is the best in the country and argue that similar work rules are in effect at many other newspapers. Some benefits, they agree, are excellent, but these were often obtained at the expense of wage increases. Under the expired contract, the minimum pay for reporters at the Times-Leader ranged from $241 to $369.75 a week. This is almost exactly in line with the average salaries of Guild reporters nationwide and far below the top minimum pay of $560.50 a week. While all newspaper owners dream of non-union shops, Capital Cities has made it a corporate policy to act out its fantasies. Most of the papers it has acquired — in Kansas City, Fort Worth, and Belleville — have no Guild chapters at all, and management is free to dictate conditions of employment as it sees fit. At The Oakland Press, where there had been a Guild chapter for many years, Capital Cities provoked Continued on next page MONDAYS open mike for musicians 8-12 half price • tap beer TUESDAYS open mike for poets WEDNESDAYS April 4 Ted Stack 14 Alan Wachs 18 Jill, cabaret singer THURSDAYS Ben Wa (fusion jazz) FRIDAYS and SATURDAYS April 6-7 Tracks 13-14 Cruise Control 20-21 To be announced 27-28 Ben Wa Playback Theater April 5-7, Thurs.-Sat., 8pm No Prisoners Company • Fishing for Laughs multi-media comedy show 228-1008 reservations 300 NW 10th 19
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