“I am sad for my former colleagues, and I worry about the quality of the newspaper that I still read every day,” he writes. “I am also angry that hard-working journalists must bear the brunt of McClatchy’s debt and business decisions.”

Among the many Facebook comments he posts, surely from a reporter: “Who’ll save my ass now?”

——– Original Message ——–
Subject: Weekly meeting today…
Date: Tue, 7 Jun 2011 09:33:38 -0400
From: John Drescher <john.drescher@newsobserver.com>
To: allnews@nando.com

at 2 pm in the McDaniels conference room.

And, from The N&O’s Afternoon Update today, why copy editors are important:

(Emphasis ours.)

***

Managers at the The News & Observer in Raleigh told about 25 copy editors and page designers on Monday that their jobs were being transferred to a new production hub at the Charlotte Observer. The move is to start over the summer and be fully in effect by mid-September.

The Charlotte production center will produce The N&O and its 10 community papers, including The Chapel Hill News, The Cary News and The Herald in Smithfield. The Charlotte copy desk already prepares The Herald of nearby Rock Hill, S.C.

Look for McClatchy’s South Carolina papers, including The State in Columbia and the Sun News in Myrtle Beach, to eventually be added to the Charlotte production hub, though their managers are waging the same futile fight against it that The N&O’s management lost.

N&O employees will be able to move to positions in Charlotte and get a $5,000 relocation stipend plus one week’s pay per year worked with The N&O, up to 13 weeks.

Some Raleigh copy desk managers will lose their supervisory duties and take pay cuts as Charlotte takes over, and others at the top of their pay ranges may see their pay cut or frozen, a company memo says. Pay cuts are not to exceed 10 percent and would come at the end of the year.

Those who don’t want to move will get the standard severance package of two week’s pay per year worked up to 26 weeks and COBRA insurance assistance. All Charlotte copy desk employees are being offered buyouts with the same deal.

Many of the copy editors and designers now in Raleigh are veteran workers (because most of the young workers have been laid off already) with ties to the community and are not expected to move. This will allow McClatchy to hire new and younger designers and copy editors for less money or make do with fewer.

The move is another attempt to bail water instead of repairing the ship. McClatchy is incrementally merging the Charlotte and Raleigh papers, having already merged the Sports and Features  departments and the Capital bureau in Raleigh, but hasn’t shown what it will take to make the big, final, inevitable move.

Most positions are being physically moved toward Charlotte instead of to the state capital because the Charlotte office building inherited when McClatchy bought the paper from Knight Ridder is vastly superior to the dingy offices of The N&O in Raleigh. And because Charlotte managers continuously prevail in negotiations with N&O brass.

***

The Charlotte Observer follows The News & Observer and others last week with its announcement this week of 26 positions being cut, as the Lexington Herald-Leader announces the elimination of 15 jobs, the Associated Press says.

Charlotte will also freeze 25 vacant positions. Four positions will be lost from Charlotte’s newsroom.

Lexington’s lost jobs include four now vacant.

McClatchy newspapers announced the elimination of about 100 positions in Raleigh, Miami, Kansas City and Bellingham, Wash., last week following a first quarter report that showed a $1.96 million loss as ad revenue plunged 11 percent year-over-year.

Jobs will be eliminated through a combination of buyouts, layoffs and open positions left vacant. At The N&O, reportedly, a 50-year veteran of the Business office is among those being laid off.

The company is also closing two suburban papers in Kansas City and one in Missouri.

And, the company announced Tuesday that its employee stock purchase program is ending because of lack of participation. Fewer than 5 percent of eligible employees are buying stock, which is available at a discounted price through the program, Heather Fagundes, vice president, Human Resources, said in a memo to employees.

McClatchy stock closed at $2.83 Tuesday. It once sold for $77 and, at one point, for as little as 35 cents a share.

McClatchy announced last month that it  lost $1.96 million in the first quarter of the year on an 11 percent drop in advertising revenue.

Elsewhere, Challenger, Gray & Christmas said today that U.S. employers had announced plans to cut 12 percent fewer jobs in April than they had in March.

Media Jobs Daily reminds us that the publisher lost $2 million in the first quarter of 2010, too. And, as Rachel Kaufman writes: “Doesn’t look good.”

As the company’s slump deepens, the Associated Press says part of the problem is that seven of McClatchy’s newspapers are in California and Florida, two of the regions where the downturn in housing prices has been sharp. And, of course, the advertising shift from print to the Internet also continues to hurt.

The 1Q report actually shows that McClatchy’s digital ad revenues grew by  2.2 percent compared to the first of 2010, and were 20.1 percent of  the quarter’s total advertising revenues, up from 17.5 percent in the first three months of 2010.

Overall revenues for the quarter were $303.7 million, down 9.5 percent from 1Q 2010. Advertising revenues were $225.1 million, and circulation revenues were $66.2 million, falling 5 percent.

“The slowing in advertising revenue that we previously reported for January continued through the first quarter,” CEO Gary Pruitt explained. “National advertising continued to be one of the largest areas of decline, falling by 29.3 percent in the first quarter of 2011 compared to 2010. In addition, the shifting of the Easter holiday to a later date in April 2011 compared to 2010 had a negative impact on retail advertising in March. As a result, advertising in March was down 12.7 percent, pulling down the overall ad revenues in the quarter to an 11 percent decline.”

Here’s a good idea from Pruitt, who took home $3.71 million last year, including a $1.85 million bonus: “In response to this year’s weak start in advertising, we have increased our ad sales efforts companywide … .”

On the other hand, he also says much of the lost revenue is not coming back. “I would say that we need to recognize that a big piece of that [a structural shift to digital marketing] is structural and permanent, and therefore we need to make sure that our expense structure is reflecting that and is permanently reduced as well.”

McClatchy eliminated nearly 540 full-time jobs in the first quarter of 2011, a nearly 9 percent reduction from the same time last year, the Associated Press said. The company has also consolidated computer systems and printing among newspapers and hired contractors in place of staff.

The newspaper publisher’s “major managed services contract” is with Atex,  an integrated content management and advertising solutions firm headquartered in Reading, Berkshire, in the United Kingdom.

The News & Observer in Raleigh, N.C., will be the first of McClatchy’s 30 daily newspapers to use the hosted software in a project to be completed this fall, News & Tech said.

McClatchy staffers will eventually manage all order entry, financial accounting, customer relationship management, ad layout and classified pagination from a single database.

Adoption of the new system is to standardize advertising workflows and establish common processes across newspapers and other publications to reduce operating costs, streamline advertising processes, and enhance revenue potential with targeted print and digital ad packages, the companies say in a news release.

The  McClatchy system will be hosted at an Atex SAS-70 approved data center to lower costs and consolidate IT infrastructure, the release says.

McClatchy could collect as much as 50 percent  from deals it sells and distributes through the in-house program, compared to 15 percent it reportedly gets from Groupon.

Groupon negotiates discounts with local businesses and offers coupons to subscribers through daily email. The benefit to local businesses increases as subscribers post the deals to social media sites.

McClatchy’s move follows others publishers that have tried their hand at their own Groupon-like programs.

Christian Hendricks, McClatchy’s VP-interactive media, says the publisher is taking what it learned from Groupon and applying it internally. “There’s no reason we can’t continue our relationship [with Groupon]; the agreement allows us to do both,” Hendricks said. “We will be in the same business.”

McClatchy, which publishes 30 daily newspapers, joined Groupon in July and offers it in 21 markets, including nine added in the last two weeks.

In just two weeks, more than 15,000 subscribers have agreed to pay $2.50 a month for the publication. It had been a free insert in the newspaper and will still be available for free in newsstand copies of the Star-Telegram.

The Star-Telegram developed the publication with FYI Television, a Grand Prairie, Texas-based TV listings company.

Other McClatchy papers have changed their TV guide inserts to subscription-based models with less success, including the company’s North and South Carolina papers, which offer subscriptions to ON-TV Magazine, a product of NTVB Media.

Kevin Roach, the AP’s director of U.S. broadcast news, conducted the study and would not give Beet.TV numbers, but said newspapers’ video operations are often the first to be cut when savings are ordered from above.

But the Miami Herald is one paper doing a lot with video, and Beet.TV links to a Poynter report that explains how the McClatchy newspaper is succeeding where others have given up.

“Last year, MiamiHerald.com saw about a 25 percent growth in video traffic, making it the second-biggest traffic driver behind articles,” the Poynter report says.

The Herald has learned that, as Roach suggest, breaking news works best and that videos they were posting of editorial board meetings and of news makers speaking out on specific topics don’t get a lot of viewers.

The Herald and its Spanish-language El Nuevo Herald have two full-time news videographers and two photographers who spend part of their time on video, and they’ve joined with local TV stations to share content and cross-promote material, Poynter says.

The Herald and El Nuevo Herald also collaborated with WPBT2, one of South Florida’s PBS affiliates, to produce an hour-long documentary about last year’s earthquake in Haiti.

The Miami paper’s video group produces about 40 percent of what’s on the site and the rest comes from outside vendors, such as CineSport and The AP.