The News, dailies get Buffett vote of confidence - The Buffalo News

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The News, dailies get Buffett vote of confidence

Those who closely follow the fortunes of the newspaper business might have had a little trouble reading the tea leaves Thursday.

In New Orleans, the Pulitzer Prize-winning paper, the Times-Picayune, announced that it would no longer publish every day as a printed newspaper. It will continue its daily news website but print the newspaper only three days a week. It will further cut its already diminished newsroom staff. Three Alabama dailies, owned by the same company, will scale back to three days a week, too.

But in Buffalo, Omaha and 26 other communities with daily newspapers, the news was considerably better.

A letter from the world's best-known investor, Warren Buffett, was made public, describing the reasons he thinks newspapers can make it in the digital world.

In a move that has surprised those who believe newspapers are in an unending death spiral, Buffett's Berkshire Hathaway is buying 63 newspapers in the U.S., including 26 dailies, in a $142 million deal.

His letter addressed the publishers and editors of those newspapers, as well as those he already owns -- The Buffalo News and the Omaha World-Herald. (He bought The News in 1977; the World-Herald last December.)

You can read the full letter on Page A2 with the continuation of this column, but here are some of the highlights:

* Local newspapers can thrive if they "reign supreme" in local news. Buffett wrote: "I believe newspapers that intensively cover their communities will have a good future. It's your job to make your paper indispensable to anyone who cares about what is going on in your city or town."

* Newspaper companies must "rethink the industry's initial response to the Internet." Offering news for free on the Web while charging for it in print is "an unsustainable model." Some "blend of digital and print" is necessary to attract both the audience and revenue needed.

* Berkshire will keep buying papers, focusing on small and midsized papers in long-established communities. "We favor towns and cities with a strong sense of community."

* Buffett will continue his hands-off practice in terms of the paper's public policy issues. "I have strong political views, but Berkshire owns the paper -- I don't. And Berkshire will always be non-political."

* The papers will not see deep cuts in their "news hole" -- the amount of space and newsprint allotted for editorial content. "A newspaper that reduces its coverage of the news important to its community is certain to reduce its readership as well."

* In general, newspapers will continue to struggle. "Circulation nationally will continue to decline and in some cases plunge." But papers without daily newspaper competition that are the primary source of news and information and that are in cities with a strong identity can survive.

Buffett describes himself as a newspaper addict who reads five papers a day and grew up reading and delivering papers.

"I've loved newspapers all of my life -- and always will," he wrote.

It's all good news for the cities and towns where Buffett owns the papers. It also sounds like something of a turnaround for Buffett, who told stockholders in 2009: "For most newspapers in the United States, we would not buy them at any price."

But it's probably not an actual contradiction; after all, he's not buying "most newspapers." He's buying a particular kind of paper -- smaller, more entrenched in its community and with no daily print competition.

The Buffalo News will not be folded into Berkshire's newly formed media group but will continue to function as a separate entity, with Publisher Stanford Lipsey, an Omaha native, reporting directly to Buffett, his longtime friend and business colleague.

As part of an email exchange Thursday, Buffett told me, "The Buffalo News has a special place in my heart, and I would not want anybody positioned between me and its publisher and editor."

As editor, I've appreciated the kind of owner Buffett is -- supportive but never intrusive.

Much of what he's talking about in his letter rings true here.

We have emphasized local content -- redeploying our reporting resources to cover communities more deeply and expanding coverage of local business, arts and sports. These days, it's difficult for a non-local story to earn its way onto our front page, given our strong focus on regional news.

In keeping with Buffett's philosophy, The News has not seen its news hole decimated despite efforts to reduce expenses. (We have trimmed staff throughout the company, but newsroom reductions have been comparatively moderate and have been the result of voluntary buyouts -- not forced layoffs.)

And I can say from firsthand experience that Buffett has never told our editorial board whom to endorse or made any suggestions about public policy issues.

Meanwhile, we're exploring paid subscriptions for our news content on the web and other digital platforms.

Newspaper people at those 26 dailies around the country who are about to become part of the Berkshire media group should be pleased. It's a good day for the readers in those communities, too.

In the troubled world of newspapers, they -- and we -- are among the lucky ones.

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