The Breakdown

Explaining Southern California's economy

More layoffs, cutbacks at Freedom's Register newspapers

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More cutbacks are coming for the Orange County Register and other newspapers owned by Freedom Communications.

Both OC Weekly and media observer Jim Romenesko report obtaining an internal memo from Freedom owners Aaron Kushner and Eric Spitz notifying employees of newsroom staff buyouts, a mandatory two-week furlough in June and July and a "restructuring" of the sales team.

The memo also indicates that the Long Beach Register will go from a standalone daily edition to a weekly edition with a daily insert in the Los Angeles Register.

The OC Register had already laid off 32 employees in January.

RELATED: OC Register says more than 30 employees and its editor are leaving

Kushner's company has pursued an aggressive strategy to expand across Southern California while emphasizing its print product in Orange County.

In the memo sent out Tuesday, Kushner and Spitz call the cutbacks a necessary step but defend the overall success of the company's strategy.

"Critics will try to say that we have failed," they write. "To the contrary, the failure would be if we did not try at all, or if in our measured success we did not adapt so that we could continue to invest in our growth."

RELATED: OC Register parent to expand into Palm Springs

The full text of the memo, as published by Romenesko, follows:

June 3, 2014 – When we came to the Register nearly two years ago, we were explicit in our mission to become a different kind of newspaper, one that builds community and grows itself. We were also clear that the fulfillment of our mission would be incredibly challenging and ultimately we hoped rewarding.

Over the last 22 months, we have made a bold investment in the future of newspapers and we are far from finished. We have expanded and created locally focused newspapers that cannot be matched in terms of their depth and quality. We have invested in staff, sections and community-building programs to deliver tangible value for our subscribers and advertisers.

We continue to expand the geography and depth of service to our communities, and in doing so hear daily reminders of how our newspapers enhance the quality of life for subscribers and help local businesses grow. We should be proud of that fact, and we should be proud of the energy we’ve invested into assuring the vitality of our newspapers.

When looking at our accomplishments, we have proven that we can:

• dramatically improve the quality of our newspapers and their impact for the community with journalism talent that is among the best in the nation
• launch major new papers in big geographies at an amazing caliber of product
• grow print advertising revenue and account base, not just digital, especially among local community-based businesses
• make print advertising really work across every category
• grow print circulation revenue even at double digit rates
• grow total revenue- many in the industry believe it’s a “given” that revenue will be permanently declining, and some have simply given up. We have shown that does not have to be our fate.

Most predicted the accomplishments noted above would be far-fetched if not impossible.

The level of investment made into the business and the enhancements to our portfolio have been dramatic. To continue to invest and grow over the long term, we have to align our cost structure with what we now know we can achieve in revenue growth. Doing so will not be easy and will impact all of us, but it is necessary to ensure a strong and healthy future for our newspapers.

To that end, Freedom is instituting the following measures:

• a company-wide, two-week furlough during the months of June and July (see related FAQ)
• voluntary severance packages within the newsroom
• restructuring of the sales team to ensure sustainable, cost-effective growth
• Long Beach Register transitioning from a standalone edition to daily section within the Los Angeles Register, and a standalone Sunday section delivered to 61,000 households and within subscriber copies of Los Angeles Register on Sundays (see related news release)

Department leaders will be meeting with you today to provide more information on these measures and how they specifically impact you.

Critics will try to say that we have failed. To the contrary, the failure would be if we did not try at all, or if in our measured success we did not adapt so that we could continue to invest in our growth.

Your commitment to pour everything we have into proving that newspapers have a vibrant and healthy future has not gone unnoticed. We are resilient and committed to winning. Thank you for your understanding, hard work and focus toward growing the Register, The Press-Enterprise, and our entire portfolio of newspapers, magazines and websites.

Sincerely,

-Aaron Kushner, CEO
- Eric Spitz, President

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