Thursday, January 29, 2009

Anschutz to close Baltimore Examiner

Conservative billionaire Phil Anschutz (at left) has decided to close his Baltimore Examiner but keep open his other free dailies in San Francisco and Washington. All three are said to be losing money, but Baltimore was losing the most. About 90 people will be fired. The paper's final edition will come out Sunday, February 15.

When he opened the Baltimore Examiner in 2006, Anschutz's managers were convinced that they could build some synergy between it and the company's Washington newspaper. While 50 miles apart, they said the two could share the same printing plant while major advertisers could be convinced to spend money in both papers.

What they didn't understand is that Baltimore and Washington are culturally two very different cities. Washington, dominated by white-collar government workers and defense-industry types, has little in common with blue-collar Baltimore.

Moreover, it is widely assumed that Anschutz, who is active in Republican politics and fundamentalist Christian causes, sees his Washington Examiner as a way to influence policy in the nation's capital. On the other hand, Baltimore was expendable.

The closure of the Baltimore Examiner also shows Anschutz's pockets are not as deep as many had assumed due to his No. 36 ranking on Forbes' list of richest Americans. While 2008 was a bad year for most investors, things were far worse for Anschutz. For instance, he's a major shareholder in the Union Pacific Railroad, which lost 62% of its stock value in 2008 — about twice the percentage the Dow Jones Industrial Average lost during the same period. His stock in Regal Entertainment Group didn't do much better, dropping 43% of its value.

His attempt to establish presence in Hollywood also collapsed last year. The Los Angeles Times reported that Disney bailed out on the "Chronicles of Narnia" franchise that the studio had co-financed and co-produced with Anschutz's Walden Media because Anschutz got too greedy after the astounding success of the first Narnia film, "The Lion, the Witch and the Wardrobe."

As Anschutz's problems in Hollywood and Wall Street were escalating, he quietly put the Baltimore Examiner up for sale.

"Initially, we were optimistic that a qualified buyer could be found because of the strong assets of the newspaper, ranging from a hard working and professional group of employees to a local-centric focus that readers appreciated," Ryan McKibben, CEO of Anschutz's newspaper company Clarity Media, said in a letter to employees obtained by the Baltimore Sun. "We also felt that a buyer would be attracted to the market because the Baltimore Sun faced significant financial challenges. Over the course of three months, we worked with several potential local and national groups in the hopes of effecting a sale. But in the end, the economic dynamics that have ravaged the print media industry also prevented a sale of the Baltimore Examiner."

McKibben, in a different letter sent today to Examiner employees in Washington and San Francisco, said the company planned to keep those papers open and intends to invest in their websites.

"Specifically, we’ve invested in the future of the San Francisco Examiner by making substantial upgrades to your website — including a new design and vastly improved functionality that will be launched at the end of March 2009," McKibben wrote in a letter obtained by the San Francisco Press Club.

The web may be the Examiner's future. It has established a group of unpaid correspondents called "examiners" who are posting stories and columns on Examiner sites set up for every major city in the U.S. McKibben's statement suggests the company's focus going forward is on the Internet.