Berkshire Hathaway newspaper chief sees long future for newspapers

 

By Alan Miller

Associated Press Media Editors

The leader of Warren Buffett's newspaper group told newspaper editors today that he sees a long future for newspapers, especially if they are thoughtful and creative in adjusting to changes in the media landscape.

 

"We will do very well in this business if we make good decisions, not just cut," said Terry Kroeger, chief executive officer of Berkshire Hathaway Media Group and publisher of the Omaha World-Herald. He spoke during the Associated Press Media Editors conference in Indianapolis.

 

He said recent reports that BH Media is interested in some Tribune properties is accurate and old news. While BH Media is interested, he said, he is not in any talks with anyone at Tribune about its papers.

 

He said Buffett, chairman of Berkshire Hathaway, is interested in continuing to buy papers in mid-size and small markets. A paper with a circulation of "30,000 to 100,000 is our sweet spot," he said. And he said Buffett is looking for a return on investment of about 10 percent.

 

He said that short-term financial difficulties at any of its properties won't lead to a sale or closure, but that the company won't buy or keep a paper that has long-term losses for which there appears no end. An example, he said, was in Manassas, Va., where the paper was losing money when BH Media acquired Media General papers.

 

"We sent in our best thinkers and couldn't come up with a way to save it, so we closed it," he said. "It had sustained losses we couldn't overcome."

 

Kroeger said his philosophy of newspapering is to develop trust between publishers and editors and allow editors to do good journalism without interference. Editors build trust, he said, by holding fast to core journalistic values of accuracy and fairness.

 

He said consolidated copy and design desks – including advertising design – "make him nervous" and he prefers to see those functions done locally at each newspaper to reduce the chance for errors by someone editing a story for a paper and audience that could be a state away.

 

"Media General papers had those when we bought them, and we have fewer of them now," Kroeger said.

 

Too many nuances can be lost in the miles between newspapers and consolidated desks, he said. And he said repeatedly that while BH Media editors meet occasionally to share ideas, news markets and consumers are so different that Kroeger says it is vital to allow local autonomy in decisions about coverage and display.

 

And local advertising is too important to turn over to someone in another state or overseas. When it comes to print versus digital advertising value, Kroeger said that "print is very critical to our business. Our advertisers will tell you that print is their most effective form of advertising."

 

BH Media paper websites are now using metered paywalls "or will be."

 

He said the newspaper industry blundered by giving away valuable content for years and now is trying to recover, and metered paywalls carry less risk than some other models of alienating readers.

 

"The last thing we want is for people to think we're an exclusive club they can't get into," he said. "We want them to come in and look around, and hopefully they like us and want to stay."