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Tuesday, October 25, 2011
Is this Sun-Times' final year?
Early last week, I heard of two more former Sun-Times Media colleagues losing their jobs. A third contacted me about it on Saturday.
Yes, we’re into the year’s fourth quarter — cuts always seem to happen toward the end of one quarter or the beginning of the next. I’m not saying that is really true, but in the round after round of layoffs that company saw over the past 10 years, one of the common threads of comments was, “I knew this was going to happen —it’s the end (or start) of the quarter.”
The reasoning always seemed to go that the company somehow had missed its revenue goal and was making up for it with employees. The logic had the ring of truth to it, and we rather accepted the reasoning because no one in the company would consider answering a question about how layoffs were timed. Or whether revenues were meeting goals (I’d have liked to know the numbers, anyway — it was pretty obvious during teach flurry of cuts and layoffs that the numbers generally stank).
Recalling all of that, however, reminded me of another timeline pertaining to the media company, and I wonder whether that has changed. If not, then this could be the final year of Sun-Times Media.
On March 31, 2009, swimming in a sea of red ink, the former Sun-Times News Group filed for federal bankruptcy protection. I do not need to dredge up the sordid details of the years leading up to that moment, nor do I need to recap the prosecution of Conrad Black and David Radler who many blamed for the demise of the company.
Ultimately, the company owed a lot of money and was bleeding ink. At this point, company officials were a little more candid about our dire straits. The company’s severance program, which offered two weeks of pay for every year worked, was gutted — cut first to two weeks, then eliminated altogether. There were other cost-cutting initiatives, furloughs, pay cuts, and fear. Lots of fear.
Yet some — I was one — held out hope that things would improve. I hoped a buyer would surface who would make changes and there would be hope again.
I was right. James Tyree rallied a group of investors who, after gaining key concessions from the various unions, purchased the company for a paltry sum — $5 million in cash and assuming $20 million of the fractured company’s remaining debt.
What we were told from the start was this investment group had a strict, three-year timeline for turning the company around. In the first year, the new company, Sun-Times Media, was expected to lose money, although there would be belt-tightening. The company expected to be in the black, if not making money by the end of the second year. In the third year, the company was expected to be profitable.
Sun-Times Media laid me off in December 2010, the final month of the year’s final quarter.
The former colleagues I mentioned earlier were let go just weeks into the fourth quarter of this year. Coincidentally, their unwilling departure from the company came not too long after Oct. 9, the second anniversary of Tyree’s acquisition of the company. The layoffs are far from auspicious — the implication is that expenses still exceed revenues.
I make the assumption the company is running on the original timeline. Tyree died unexpectedly in March, and the company’s chief executive, Jeremy Halbreich, indicated no changes were planned in the company’s strategy.
So the coming 12 months are supposed to be profitable for Sun-Times Media. I hope, but I am not optimistic.
I cannot help but draw some parallels between the Sun-Times, Chicago’s second paper, and the Rocky Mountain News, Denver’s second paper.
Both were tabloids competing against broadsheets, each had the city’s smaller share of readers. Both were scrappy papers known for good journalism. Both lost money for a long time.
For The Rocky, the clock ran out in February 2009, and some people I once worked with when I lived out West suddenly found themselves unemployed. Some found new work, others new careers. I’ve watched as some of my former Sun-Times Media colleagues, like myself, were thrust into an ugly job market. Many of us remain unemployed or underemployed. Too many had no choice but to find new careers.
Unlike The Rocky, however, Sun-Times Media continues to publish what is left of its fleet of weekly and daily newspapers.