Palo Alto Daily News publishers ride into sunset

Dave Price and Jim Pavelich, co-publishers of the Palo Alto Daily News and its five sister daily newspapers, are stepping down from the company they started 10 years ago. Knight Ridder bought the Daily News in Feburary and the two publishers stayed on during the transition. KR also asked them to start free dailies in other U.S. cities. But in November, a group of shareholders demanded the sale of KR, which put all corporate expansion plans on hold for at least a year. As a result, Price and Pavelich decided to leave KR to move forward with their own newspaper projects outside the San Francisco Bay Area.

The Palo Alto Daily News has become a model for free daily newspapers. It was profitable nine months after it started. It created a format that numerous other free dailies have copied. It's penetration of the local advertising market was breathtaking, with issues that had 150-200 display ads per day. The paper's page counts ranged from 60 to 120 per day. And the paper pulled down as many awards as long-established daily competitors, including two consecutive statewide awards for editorial writing. Reports by the Certified Audit of Circulations showed the paper had a return rate of less than 2 percent. Staffers reported that people would walk several blocks to get their copy of "The Daily" each morning.