My first journalism class at Western was taught by the zany Tim Pilgrim. I recall him explaining one day the subject of his book, Nothing Ventured, Nothing Gained: The Seattle JOA and Newspaper Preservation. At the time, the Seattle JOA (a federally sanctioned agreement in which two daily newspapers published in the same city or geographic area combine business operations while maintaining separate — and competitive — news operations) was complex and didn't mean much to me. It's still a complex subject, but several years later I see how the JOA greatly impacts the local economy and quality of journalism in the Emerald City.
We learn today that The Seattle Times Co. and The Hearst Corp., which owns the P-I, signed Sunday to settle a four-year legal dispute in which The Seattle Times Co. has sought to dissolve the JOA, citing that having to support production of the P-I is too great a financial burden.
According to the P-I, The Hearst Corp. will pay The Seattle Times Co. $25 million for The Seattle Times Co.'s agreement to stop trying to end the papers' JOA until 2016. The Hearst Corp. also agreed to drop all legal claims against The Seattle Times Co., including allegations of circulation- and promotion-related abuses of the JOA.
Until 2016, the basic structure of the JOA will remain the same, in which The Seattle Times Co. provides key business services including advertising, circulation and printing for the P-I in exchange for a larger share of the joint profits. (The Hearst Corp only collects 40 percent of joint profits.)
OK, that was some heavy and technical explanation. Here's what it all means:
The Seattle Times Co. is tired of its less circulated, less profitable competitor, the P-I, using the JOA as a financial crutch. (Read: The Seattle Times Co. is tired of paying the bills so that the P-I can stay afloat.) By dissolving the JOA, the P-I would become financially independent and susceptible to going out of business -- making The Seattle Times this city's only daily newspaper. The Hearst Corp. basically just paid off The Seattle Times Corp. to buy time to get the P-I more financially stable so that it will be able to compete when the JOA does eventually dissolve.
The Seattle Times article reporting this agreement boasts the possibility of the P-I becoming a tabloid paper because of the following language in the new agreement:
"Hearst may... choose to move the P-I to a tabloid format. In such event, Times and Hearst shall agree upon such production, marketing, circulation and advertising accommodations and adjustments as shall be reasonably necessary or appropriate to effectuate the P-I's change in format."
Honestly, I doubt the P-I will become a tabloid anytime soon. I think this clause was inserted so that the Hearst Corp. has something to fall back on if the forecast for the P-I becoming financial stable by 2016 looks doubtful. It would be able to turn the P-I into a tabloid before 2016 to entice The Seattle Times Co. to maintain the JOA . A tabloid would be far less expensive to produce and The Heast Corp. would still be able to maintain some profits.
I'm sure there's more to say about the JOA and the effects of this agreement, but I never read my professor's book. Sorry, Tim. I had a lot of drinking to do at the time.
Update: Speaking of drinking, HorsesAss.org reports that, upon learning of the new JOA agreement, P-I employees broke into a "daylong, celebratory bacchanal that culminated that night with a rented limo full of drunken reporters pulling up to Fairview Fanny… and unceremoniously emptying their bladders on the [Seattle] Times’ front lawn."