Parts of the Washington Post building have become so chilly that staffers are wondering if the Post has cut off the heat in another cost-cutting move, reminiscent of reduced travel expenses and canceled magazine subscriptions.
The fact is the Post newsroom is a paragon of financial and management stability in comparison with other big daily papers. The Los Angeles Times and the Philadelphia Inquirer are slashing staffs and decapitating editors; Wall Street is harassing the New York Times to increase profits.
The Post has gently cut staff with a pair of buyouts, and editor Len Downie has been in place since 1991. Nary a murmur from Wall Street.
Four reasons the Post has weathered the storm—so far.
1. Post Company chair Don Graham has continued to diversify the company along the path established by his mother, Katharine Graham, so that the struggling newspaper and magazine operations are sheltered by more profitable divisions. Kaplan, the company’s educational arm, has posted strong profits and steady growth along with the company’s cable and television broadcasting divisions.
2. Graham and Post trustee Warren Buffet have managed the company for long-term results rather than quarterly gains. Graham also has stocked his board with heavyweights like Melinda Gates and Barry Diller and veteran Post executive Richard Simmons, who took a special interest in Kaplan years ago.
3. The Graham family has maintained control of the company stock and protected itself from large blocks of ownership that could allow Wall Street to challenge its stewardship.
4. Don Graham bet on the Internet more than a decade ago and has pumped hundreds of millions into Washingtonpost.Newsweek Interactive. While the online operation has not brought in big profits, it has positioned the company to increase revenues from ad sales without the drag of newsprint and labor costs.
The newspaper is still slowing the company’s growth. Circulation and advertising revenues continue to decline. While the Post hasn’t figured out how to reverse the downward spiral, there are no plans for layoffs or more buyouts.
Posties might have to wear sweaters in some parts of the building, but it’s better than being out on the street.