Philadelphia Story

By ADAM REILLY  |  October 1, 2009

But others are less forgiving. "At the time they bought the company, everyone's back-of-the-envelope figures showed it would be extremely difficult for them to make their debt payments," says Jeff Brown, a former Inquirer business reporter and columnist who now writes a finance column for msnbc.com. "Even if there had been no recession, it wasn't likely the papers could produce enough cash to pay for the needed improvements to the online operation, let alone maintain a staff that had already been drastically cut."

The Globe's suitors are looking at a much smaller price tag: both the Taylor group and its competitor, California-based Platinum Equity Partners, have reportedly bid about $35 million for the paper, and offered to assume $59 million in pension liabilities. But with the Globe still struggling to turn a profit, even those numbers could end up looking foolhardy in a few years — especially if they're backed by excessive debt.

Don't overestimate the value of new blood According to Ken Doctor, author of the media-analysis blog contentbridges.com, Tierney erred in thinking that his local roots and salesmanship could succeed where Knight Ridder had failed. "Give him credit for his zeal and passion," says Doctor. "He said, 'I'm a Philadelphia guy, I know the value of these papers, and I'm going to tell people they should buy in it and advertise in it because we're Philadelphia institutions.' But if that got any results before the recession set in, they were tepid."

Brown echoes this point: Tierney and his backers, he says, "believed there was a vein of advertising that the previous owners had missed. Knight Ridder was a poorly run company, but it was certainly on a constant hunt for revenue. There was no hidden pot of gold."

Avoid foolish promises Early in his tenure as PN CEO, Tierney vowed that there'd be no more layoffs at the Inquirer and Daily News — a promise, former Rocky Mountain News publisher and editor John Temple subsequently wrote, that "made [Tierney] look naive from the start." The first layoffs of the Tierney era came roughly half a year later.

Inquirer columnist Monica Yant Kinney tells the Phoenix that the lesson is simple: "Be careful what kind of promises you make in a room full of people taking notes. If you tell us one thing, then do another, we're going to be suspicious of the next thing you tell us."

Share your employees' pain As PN edged toward bankruptcy late last year, management convinced union employees to forgo a scheduled $25-per-week raise. A few weeks later, Tierney received a $350,000 bonus; two other executives nabbed $300,000 total. (Tierney also got a 38 percent raise, which he's said he'll return.)As the Phoenix goes to press, PN is trying to wrest new concessions from the Newspaper Guild of Greater Philadelphia — and the guild is balking at management's proposals. This might have happened anyway. But Tierney's avarice made any call for sacrifice an even tougher sell.

Prioritize the Web Tierney's hiring of veteran newspaperman Bill Marimow to edit the Inquirer still earns plaudits from the paper's staff (Yant Kinney calls him a "first-rate journalist and boss"). But philly.com remains a deeply mediocre beast, visually clunky and not quite reflective of either daily's sensibility.

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