January 2, 2013

New publisher betting heavily on paper

Aaron Kushner even plans to charge the same price for his newspaper's online version as the print edition.

The Associated Press

Aaron Kushner
click image to enlarge

Aaron Kushner, shown in his office at The Orange County Register in Santa Ana, Calif., says “We’re a little crazy in that we really do believe that we can grow this particular newspaper.”

The Associated Press

click image to enlarge

Photos of some of the newly hired reporters at the Orange County Register line the newsroom wall. About 75 new journalists have been added with more on the way.

The Associated Press

SANTA ANA, Calif. -- New and expanded sections to cover business, automobiles and food. A nearly five-fold increase in community news pages and more investigative reporting. Even daily color comics.

It feels like a throwback to an earlier era at the Orange County Register, where a first-time newspaper owner is defying conventional wisdom by spending heavily to expand the printed edition and playing down digital formats.

Aaron Kushner added about 75 journalists and, with 25 more coming, will have expanded the newsroom by half since his investment group bought the nation's 20th-largest newspaper by circulation in July.

Changes also include thicker pages with triple the number of colors to produce razor-sharp photos and graphics. By the end of March, the newspaper will have 40 percent more space than under previous owners, Freedom Communications Inc.

Kushner, 39, believes people will pay for high-quality news. His bet is remarkable in an industry where newspapers have shrunk their way to profits for years, slashing costs while seeking clicks on often-free websites to attract online advertising.

As more newspapers begin charging for online access, Kushner's spending spree is drawing close attention.

"If he's successful, it's going to show the way for other papers to follow," said Walter E. Hussman Jr., publisher of the Arkansas Democrat-Gazette and an early advocate of charging readers for online access.

Seated behind his large, clutter-free desk near shelves stacked with newspapers, the former Stanford University gymnast said his lack of industry experience may be a plus because he hasn't been through the tough times in newspapering.

"So when we sit down and look at what's possible, our view of the world is different," Kushner said. "We're a little crazy in that we really do believe that we can grow this particular newspaper."

It's too early to know whether he's right. Kushner said advertising revenues have grown, though he won't say how much.

Average daily circulation rose 5.3 percent as of Sept. 30 from a year earlier to 285,088 on weekdays and 387,547 on Sundays, bucking an industry decline of 0.2 percent, according to the Alliance for Audited Media.

One key test will be when the Register begins charging for online access sometime before the end of March. He said readers will pay the same as the print edition - a contrast to publications that charge online subscribers substantially less.

"If you have a wonderful restaurant and it cost $10 to come in the front door, I've never understood why it should cost anything less to come through a side door," he said.

"The value of the journalism isn't any less. The reporter isn't paid any less. The photographer isn't paid any less."

Kushner, who has a master's degree in organizational analysis, founded a business in the 1990s that allowed people to change their addresses online and later owned and managed a greeting-card company for seven years.

In 2010, he started an investors group, 2100 Trust LLC, to scout for newspapers, flirting with The Boston Globe and later with MaineToday Media Inc., publisher of The Portland Press Herald.

Tom Bell, president of The Portland Newspaper Guild, said Kushner presented the union with 50 demands, including a longer work week and increases in employee health care contributions.

"We got off to such a bad start that it was hard to recover," said Bell, who is skeptical of that Kushner's print bet will succeed.

Kushner settled on Freedom and its 107-year-old flagship paper, the Register, for an undisclosed sum. The newspaper serves affluent, growing, well-educated and ethnically diverse communities near Los Angeles, bolstered by 24 community publications.

Kushner became Freedom's chief executive and the Register's publisher, working five days a week at the company's Santa Ana headquarters and flying cross-country to his wife and three children in the Boston area.

(Continued on page 2)

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