Tribune Co.: Work in Progress

On April 1, 2009, anyone who typed www.tribune.com into his favorite browser would have learned the big news surrounding The Accelerator. As the home page of the Chicago-based Tribune Company’s Web portal explained, The Accelerator was “a high-power, low-cost communications device” that would “make all media, including the Internet, obsolete by next year.” It used “nano-technology to aggregate the sum of all human knowledge” in order to deliver it “directly into your brain.” The project won the effusive praise of Tribune COO Randy Michaels, who credited staffers with putting in “long hours, many of them sober.” The Accelerator was also, of course, an April Fool’s Day prank.“Yes, I was involved in writing some of that silliness,” confesses Lee Abrams, the company’s chief innovations officer. In truth, however, The Accelerator was far, far more than an April Fool’s gag. It was emblematic of just how far the once supremely buttoned-up Tribune Company—which roosts within an 84-year-old Gothic-revival tower downtown—has come in the past year or so. Back in the day, for the Tribune to give anything as public as a home page over to a prank would have been about as likely as finding white-linen tablecloths at the Billy Goat Tavern.“[The Accelerator] was a joke, but it also was a symbol of the dramatic cultural changes that have happened, and are still happening, here at the company,” Abrams continues. “We really feel that to do the best work possible you have to create an environment where creativity and innovation aren’t an option; they are mandatory.”The Accelerator also happened to be a birthday card for the 55-year-old Abrams, who was brought in exactly a year before by Michaels to infuse the company with a major dose of creativity and fresh thinking, qualities that Abrams demonstrated repeatedly during his career as one of the media industry’s preeminent Renaissance men.Indeed, you might not know Lee Abrams by name, but chances are you know some of what he’s responsible for. Abrams’ work has included the redesign of Rolling Stone and he was involved in the creation of the MTV cable network. But his real claim to fame was in the radio business, where he is credited with inventing the modern radio format structure, including Album Rock, Classic Rock, Urban/Dance and New Age/Jazz.Abrams was also one of the colorful minds behind “Disco Demolition Night,” a stunt that took place on a hot July night in 1979. Fans of Chicago radio station WLUP were invited to a doubleheader at Comiskey Park, and told they could get in for 98 cents (98 is the station’s home on the FM dial) if they brought a disco record along. The idea was to pile all the hated vinyl into a crate in center field, then blow it up. Inebriated fans—and 90,000 people showed up to a ballpark that could hold only 52,000—stormed the field instead. By the time the police left and the fires were put out, 39 people had been arrested. The notorious event has found its place in marketing history as proof that some ideas can be too successful, but that all publicity is good.In 1993, Abrams was named by Newsweek as one of America’s “100 Cultural Elite.” Five years later, he took on another major challenge when he became the chief programming officer of then-nascent XM Satellite Radio. In fact, Abrams had accomplished so much in his professional life, there seemed few challenges that he hadn’t taken on.Then Michaels and Sam Zell came knocking.Though the two had never worked together, radio-veteran Michaels had been a longtime buddy of Abrams. In April 2007, following a boardroom revolt that had forced the Tribune Company to go private, Michaels and real-estate billionaire Zell put themselves in control of the operation. They also found themselves in a lot of trouble. Newspaper circulation and ad revenue were in a nationwide free fall as legions of readers were opting to get their news online. Media buyers and industry analysts were increasingly concluding that newsprint was about as enticing to Web-age readers as a game of Pong would be to an X-Box owner. Tribune’s problems were exacerbated by a $13 billion debt load created by Zell’s takeover—a debt that could scarcely be serviced by nosediving revenues.To complicate things even further, Abrams—the man Michaels tapped to fix everything—was not, this time around, the obvious fix-it man.“He had no experience in newspapers,” remembers Mark Fratrik, a vp at BIA Financial Network and an adjunct professor of communications at Johns Hopkins University. “But newspapers have been—and still are—in such a challenged state that they have to try to shake things up. And Lee does come from radio, which is incredibly entrepreneurial because there are so many competitors out there. Sometimes you need someone from outside to create a paradigm shift.”Change AgentOne year into Abrams’ tenure, it’s unclear whether there’s been any sort of paradigm shift at the Tribune Co. But Abrams has made his presence felt and, just like it was in the radio days, he has both fans and people who don’t want to listen.The company—which includes 10 daily newspapers, 23 broadcast TV stations, the WGN America cable network, the WGN-AM radio station and the Chicago Cubs baseball team—remains on the ropes financially. Unable to manage its crushing debt load, Tribune filed for Chapter 11 protection from its creditors in December 2008. According to the company’s latest filing with the Securities and Exchange Commission, which covered the first nine months of 2008 (a Tribune Co. spokesman says the company will not file any more public-earnings reports while in bankruptcy proceedings), overall revenue was off 7.9 percent, to $3.1 billion, on publishing revenue that had fallen 11.6 percent, to $2.1 billion, and broadcast and entertainment proceeds that were flat, at about $1.1 billion.Under storm clouds as ominous as those, Abrams was easily Tribune’s most critical hire of 2008, and he remains under intense pressure to turn things around—and fast.Indeed, he’s been trying. Logically enough, his inaugural efforts focused on the newspaper side of the business. Shortly after coming on board, Abrams set out on a marathon of meetings with top executives in the company’s management, editorial and publishing spheres to help remake Tribune’s roster of major dailies, including the Hartford Courant, the nation’s oldest continuously published newspaper; the Orlando Sentinel; the Chicago Tribune; and the Baltimore Sun. The flagship Chicago Tribune, an august paper that for generations looked across the Chicago River at the more proletarian Chicago Sun-Times, got a humbler set of clothes to put on. The regular broadsheet—which currently remains the company’s vehicle of choice for home delivery—spawned a tabloid version of itself for newsstand and kiosk distribution. While Abrams is quick to point out that the tabloid version “has the exact-same content as the broadsheet, it’s just packaged in a better way for commuters,” that level of evolution (or devolution, depending on your point of view) clearly was not for everyone in the Tribune Company family. The Los Angeles Times, for instance, received a redesign that was more understated—in large part due to pushback from West Coast editors who, Abrams says, “wanted to do their redesign in a more incremental way.” Changes include subtle addition of color and more call-outs to the paper’s Web content.Some of what’s gone on at the Tribune under Abrams’ tenure has generated considerable controversy both inside and outside the newsroom—a place where 53 reporters lost their jobs on April 23 as part of a reorganization effort. In an interview last October with the now-defunct Condé Nast Portfolio, Abrams said, “There was a big myth that you could not have these [newsroom] cuts … and still produce a quality paper, and that’s just nonsense.” Abrams also related that the Tribune had introduced what he termed “boot camps” for reporters, the purpose being to “liberate everybody from everything they ever learned” about the newspaper business. And those who didn’t much feel like being liberated? “They’re gone,” Abrams declared.Though it may not have been a contemplated part of Abrams’ liberation philosophy, what was later termed a “brief market research project” made news this past May when a protest e-mail signed by 55 Tribune reporters found its way to the Associated Press. The staffers were up in arms over rumors that the paper’s marketing department had sought subscribers’ opinions on various stories before those stories were published—a practice that violates one of journalism’s most integral principles. Later, Tribune editor Gerould Kern issued a statement saying that the reader-reaction project had been “discontinued.”Purists were not amused. One of them was Edward Ericson, a blogger for the Baltimore City Paper, who subsequently pointed out that the gaffe at the Tribune bore an unsettling resemblance to the consultant-generated playlists and similar Abrams changes that critics say homogenized the radio business. “Abrams,” Ericson wrote, was “mutating” the Tribune into a “marketing-driven analogue.”Meanwhile, Abrams has also turned his attention to the TV side of the Tribune empire. In March,the company announced it would consolidate the operations of the Hartford Courant and the Tribune’s two area TV stations, Fox affiliate WTIC-TV and The CW affiliate WTXX. According to the company’s plan, the stations will broadcast from a newsroom, which will begin construction this summer within the Courant’s offices.In early April, Tribune announced a significant rebranding of WGN America, the company’s cable channel. The changes look to position WGN America, formerly Superstation WGN, as a broad entertainment destination for all parts of America, not just the Chicagoland area as was the case in the past. New programming, much of which launched in mid-April, includes WWE Superstars, with the biggest and scariest grapplers from the world of Raw, Smackdown and ECW; Around the World for Free, which features Alex Boylan from The Amazing Race as he spans the globe without a penny in his pocket; and Cultivating Life, a DIY show hosted by Sean Conway.One of the makeover’s more interesting elements is something that harkens back to Abrams’ broadcasting days. As part of the changes, which also include a new retro logo, WGN America is introducing a “sonic logo,” a series of tones that are meant to form a linkage in the viewer’s cerebral cortex that is not unlike NBC’s three-note signature chime.The Popular VotePerhaps not surprisingly, Abrams’ reception within Tribune seems to range from cautious approval to an uneasy ambivalence. Not that anyone hired to shake up an organization can hope for much better. But Abrams insists he’s not the guy in the dark hat. “My function is not to come in and order people to make changes,” he explains. “My role is more about creating an atmosphere that drives innovation, one in which people at this company are asked to brutally examine the way we are doing things and whether we could be doing them better.”Of course, most human beings do not enjoy being “brutally examined.” And even Abrams himself will admit that not everyone bought into his vision, expressed upon taking the Tribune gig, that the company soon would become “an oasis of creativity.”“When I first came on board we weren’t looking to make The Tribune Company into a radio company, but we were trying to inject some of that entrepreneurship,” he says. “I understand that not everyone likes change and evolution. But if change is well conceived and executed, people shouldn’t fear it. I found that about 70 percent of the people inside this company embraced the type of change I was talking about pretty much from the start. Another 20 percent were confused by it but eventually got on board. And another 10 percent, I’d say, were totally turned off by it and didn’t want to have any part of it.”Abrams can apportion things as he sees fit, but according to one source at least, Abrams has espoused more of a with-me-or-against-me mentality, with not a whole lot of room left in the middle.“You have to understand that he was brought in as an agent of change,” says one former executive for the Tribune Company, who wished to remain anonymous. “Sam [Zell] really wanted to turn our culture on its ear. So he and Randy [Michaels] brought in Lee. I don’t think anyone ever questioned Lee’s ability to think outside the box, but you could question whether he was the right guy to bring in.“You wanted to listen to this guy because he had the ear of the top brass. But if you were in some of those meetings and you didn’t buy into his vision, it became pretty clear that you weren’t really going to be part of the program.”This executive, however, does credit Abrams for employing a somewhat laid-back management style that was rarely, if ever, negative. “You never felt like he was cramming something you didn’t want down your throat,” the executive says. “He would sit back for most of the meetings and then comment on what he liked. He was very positive and, once a project got to a certain point, Lee became a real cheerleader for it.”Advertiser ResponseIf Abrams’ changes have met with a mixed reception within the company, the response from outside—specifically, the advertiser community—seems more uniformly positive. Kevin Gallagher, the executive vp and local activation director at Starcom USA in Chicago, said in early April that he and his team were working on a deal for one of the shop’s advertisers that would involve multiple elements within the Tribune Company. While the concept of the multi-platform deal is not new, he says, Tribune’s ability—and desire—to deliver these types of programs have changed in roughly the same amount of time that Abrams has been with the company.“The notion of cross-asset selling has been around for a number of years and a lot of companies have been trying to do that, but the internal silos still existed,” says Gallagher, who declined to disclose which client was involved in the multi-platform deal. “But the fluidity we’re seeing lately with the Tribune seems to indicate that is starting to change. What we’re seeing from them is far more dead-on than at any time in the past, and we’re getting the sense that these deals are being facilitated far more efficiently within the Tribune Company.”And, according to Abrams, advertisers should expect to see more of the same in the future.“Like newspapers, TV stations tend to rely on a playbook that was written in 1988,” he says. “We have all these great assets out there, and I think we really have to look at how TV and print can be brought together in new ways so that it makes sense from a content standpoint as well as a financial standpoint.”Despite those lofty goals, however, some, like Robin Steinberg, senior vp and director of print investment and activation at MediaVest, suggest that the jury still may be out on Abrams. While she contends he has yet to have “a huge impact” on Tribune that outsiders can observe, she goes on to say that Abrams “obviously is very innovation driven, and I have to give someone credit for thinking that way.”“Newspaper people are very tradition-minded,” she adds. “Tribune, like every [other company] in the newspaper industry, is going through a rough time right now. And they’re trying to figure out the best way to reach the consumer.”Abrams, Steinberg concludes, “really is trying to evolve [Tribune’s] business. I’m not sure he’s totally connecting with everyone yet. But the guy could ruffle some feathers. And that isn’t always a bad thing.”Where Did All the Readers Go?Tribune Company’s spring hasn’t gotten off to the best start imaginable. In addition to widespread layoffs that recently claimed more than 60 staffers at its Baltimore Sun, a kerfuffle at the Chicago Tribune over running unfinished editorial past advertisers to gauge their responses and a brouhaha at the Los Angeles Times about front-page ads that looked a heck of a lot like editorial, Tribune got some unwanted news on April 27 when the Audit Bureau of Circulations released its latest FAS-FAX report. While non-Tribune newspapers also fared poorly, the declines at the company’s dailies, many of which unveiled redesigns during the FAS-FAX reporting period, were not heartening.Newspaper Daily Circulation % ChangeLos Angeles Times 703,181 -6.55Chicago Tribune 501,202 -7.4Orlando Sentinel 206,205 -9.4Baltimore Sun 210,098 -9.6South Florida Sun-Sentinel 195,522 -10.4Hartford Courant (weekday) 155,540 -7.5

Performance Marketing

Tribune Co.: Work in Progress

Richard Brunelli

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Richard Brunelli