BANG-EB: THE GUILD UPDATE

News of the MediaNews bankruptcy

04 Feb 2010

California Media Workers Guild

IN THIS EDITION:

* Bankruptcy update
* Consolidation with the Chronicle?
* Using your vacation time
* Can the iPad save journalism?
* Industry news


Bankruptcy update

The MediaNews bankruptcy marches ahead.

So far, proceedings in Delaware bankruptcy court seem to agree with the idea that Chapter 11 proceedings will be limited to MNG's holding company, Affiliated Media Inc., and will not affect employees or union contracts.

David R. Hock of Cohen, Weiss and Simon represented The Newspaper Guild/Communications Workers of America locals at the first day hearing on Jan. 26. It appears the pre-packaged bankruptcy will come to a swift conclusion, heading for confirmation without objection on March 4.

The U.S. Trustee is not inclined to convene a creditors' committee. Local counsel of record will keep us updated on any court filings.

What the bankruptcy documents have shown so far:

* Hearst loses its $300-$400 million investment in MNG, but will get warrants that someday could be converted to stock.

* MediaNews President Jody Lodovic and Chairman and CEO Dean Singleton will continue to control the company post-bankruptcy.

* Under the reorganization plan, Singleton gets $634,000 in annual salary, an annual bonus of up to $500,000, and another $360,000 in salary from the Denver Post Corp. (Read AP's story here: http://abcnews.go.com/Business/wireStory?id=9643608)

* Lodovic gets $1 million in annual salary and an annual bonus of up to $500,000. He already got $500,000 in bonuses for leading the reorganization, and stands to get an extra $250,000 bonus when the bankruptcy is official.

Guild attorneys will continue to monitor the proceedings, including scouring all Local agreements and pension plans for any mention of Affiliated Media.

The full text of the bankruptcy disclosure statement can be read here: http://price-news.com/disclosure-statement7.pdf

Consolidation with the Chronicle?

At this point, a main concern for all of us should be whether this bankruptcy will pave the way for even more consolidation -- including a potential merger of the Bay Area News Group with the San Francisco Chronicle.

Singleton has been open about his desire to pursue more aggressive consolidation post-bankruptcy, telling the Washington Post that to imagine where such mergers might occur, "You can look at the map."

As blogger Alan Mutter notes, "The long-running losses at the Chronicle, plus the MediaNews bankruptcy, may be sufficient to persuade regulators that an antitrust waiver is necessary to sustain journalism in Northern California."  (Read the rest here: http://newsosaur.blogspot.com/2010/01/next-for-medianews-rolling-up-ailing.html)

Over the past few years, both the Chronicle and the Bay Area News Group have suffered huge cuts to staffing, benefits, and our news hole. Guild members at all our region's newspapers have endured significant personal sacrifice to help keep our companies afloat.

We understand the financial realities of our industry. Our bargaining units have always sought to act as partners rather than adversaries. When our companies succeed, we all benefit.

But when we see our owners making grave mistakes, we must stand in their way. If cheapening and worsening of our product continues, our readers and advertisers will lose their last shreds of faith in our ability to serve the public, and provide accurate, comprehensive and timely information.

Corporate owners routinely push for mergers and less competition. That's never been in the best interest of workers or the community; it's illegal in many cases.

The Guild will fight any attempt to eliminate newsroom jobs, or entire newsrooms. We need a real, long-term business plan that values quality jobs and quality journalism. Cuts and consolidation alone cannot save the news business.

One last thought on the MNG bankruptcy, and local vs. corporate ownership, from the Seattle Times:

"Newspapers need to be in the hands of people who care about them. Those are almost always investors with a strong local connection. The San Jose Mercury News ought to be owned by people from San Jose — not by a company in Denver owned by another company in Denver owned by a bank in Charlotte, N.C."

Read the rest here: http://seattletimes.nwsource.com/html/editorialsopinion/2010889537_edit26singleton.html

Using your vacation time

Newsroom employees were recently asked to tell their supervisors when they plan to take vacation time this year, for accounting purposes. The company said its "expectation" is that all workers take the amount of vacation they accrue each year.

The Guild understands the company’s need for this information and their desire to reduce the amount of accrued vacation on the books. In fact, during the last contract negotiations, the Guild offered to discuss a system like the San Francisco Chronicle’s, where employees schedule their vacation at the beginning of the year with the intent of using all their yearly accrual. The company declined.

The Guild still encourages employees who have planned vacations to inform their supervisors and schedule their time off early. However, we also want to remind workers that there is no requirement to take this time off. According to our contract, "Employees may accrue up to a maximum of 1.75 times one year’s vacation benefit." For example, if you currently earn 15 vacation days a year, you may accrue up to 26.25 days (or 210 hours). Once you reach the maximum accrual, you won't earn more vacation until you use some of it up.

The company has said employees will not be held to the approximate vacation plans they indicate now. However, if you feel uncomfortable scheduling vacation you aren't sure, or don’t think, you will actually be taking, you have every right not to schedule it and simply accrue the hours.

With the Guild also hearing complaints that members have not been able to schedule vacation when they wanted to because of staffing levels, knowing about these rights is especially important.

If you have trouble with this, please contact your shop steward or other Guild leader.

Can the iPad save journalism?

Pundits varied last week on whether Apple's new release will help our industry, but one thing is clear: It makes no sense to simply translate old-school print content onto any new device.

Yes, MediaNews' bankruptcy woes are a huge distraction, but it would be a big mistake not to keep looking forward, and keep up with new technology.

We say: There's no better time than now. We're creating a short-term task force to research the iPad and other e-readers, to discuss how they might change our products, and to recommend specific training that will help journalists make the most of these devices.

State training funds will be available through July; it only makes sense to move aggressively and take advantage of them, despite the gloom and doom of our industry.

Ready to volunteer? Or just want to share ideas? E-mail Sara Steffens at modernsara@gmail.com.

Industry news

The nonprofit Bay Area News Project has hired its top leaders: Editor-in-chief Jonathan Weber and CEO Lisa Frazier.

Weber is perhaps best known in the Bay Area as the founder of The Industry Standard, a dot-com era magazine. After that company filed for Chapter 11 bankruptcy, Weber moved to Montana and founded New West, which covers the Rocky Mountain region through its Web site, NewWest.Net.

Frazier, a partner at consulting firm McKinsey & Co., began helping structure the Bay Area News Project last spring.

Weber plans to hire 15 journalists by the end of the year, and double that number in the next two to three years. He told the Guild he is casting a broad net for talent and hopes to post job descriptions soon.

While interns likely will play some role in the News Project, “It's definitely not the case that we envision Berkeley students being a substitute for professional journalists,” Weber said.

“We intend to be very open as an organization, and we intend to pursue a wide range of collaborations, with high-quality and competitively compensated, professional journalism staff at the core,” he added.

The group also announced it has reached an agreement to supply news for the Bay Area section of the New York Times, and that founding partner KQED will not serve on the board of the Bay Area News Project.

Read more here: www.mediaworkers.org/index.php?ID=7188