MediaFile

First Melinda Gates, now Warren Buffett exit Wash Post board

WarrenBuffettWarren Buffett has always had a sweet spot in his heart for newspapers. Until he didn’t. In recent years, Buffet – once a paper boy, now a newspaper owner — has been quite vocal about the prospects of the industry.  For instance in 2009 during a Berkshire Hathaway gathering in Omaha he told investors that  the newspaper industry  had the possibility of  “unending losses” and that Berkshire would not buy most newspapers in the U.S.  at any price.

Buffett, who owns the Buffalo News and has deep ties with the Washington Post, just cut another string of attachment to the industry: After nearly 40 years, Buffett said he is leaving the board of the Washington Post Co.

As my colleague Ben Berkowtiz reported, Buffett has been dialing back on his board commitments, choosing to devote more time to Berkshire Hathaway.

Buffet’s departure comes at the heels of another high-profile board member Melina Gates, who left the Washington Post board in November. With the newspaper  industry in decline — it has yet to enjoy the bounce-back in advertising enjoyed by other media like television — the Washington Post is suffering like its peers. Even worse, the company’s cash cow the Kaplan education division is in danger of getting hit by government rules that could impact the business.

While Buffett and Washington Post chief executive Donald Graham, whose family owns the Washington Post, said in a statement that Buffett will still be available to advise the education and media company, the lastest move has got to sting.

Big changes at The Washington Post

You could read the whole memo about changes at The Washington Post at Romenesko, or you could read the important parts more quickly here.

The bottom line, courtesy of the memo sent to employees on Thursday from Executive Editor Marcus Brauchli and his top deputies, Liz Spayd and Raju Narisetti: Get stories out more quickly. Don’t worry about how you do it — on paper, a Blackberry or whatever. Just get it out there. And don’t slack on the writing and editing, please.

Excerpts from the memo:

Today, we are beginning a reorganization to create new reporting groups, streamline editing desks and anticipate the impending integration of our print and digital news operations. …  [W]e want to simplify the handling of words, pages, images and new media, building on the prescient move to “two-touch” editing under Len and Phil. Decisions about space and play must happen faster, both in print and online, and in a way that pulls together our now-separate newsrooms. A single editor ultimately ought to be able to oversee all versions of a story, whether it appears in print, online or on a BlackBerry or iPhone. Space in the newspaper and editing firepower in general should be allocated based on a day’s news priorities, not a predetermined formula.

Read The Washington Post’s buyout memo

The Washington Post is offering new buyouts to help the money-losing paper cut costs as it pursues a plan to become profitable again. You can read our story about it, along with an interview with Publisher Katharine Weymouth. Meanwhile, here are some excerpts from her memo to Post employees:

I need not tell you that our industry is undergoing a seismic shift as readers face an array of media choices and our traditional advertising and circulation bases decline. The good news is that the appetite for news is as robust as ever. Thanks to our presence on the Internet and on mobile phones and other devices, our audience includes more readers now than we have ever had. But while online revenues have been growing, they have not yet grown fast enough to offset the declines we are seeing in print revenues. As we move forward, our path is pretty straightforward: we will have to reduce our cost structure…

Below are some of the specifics on the VRIP that we plan to offer certain exempt employees in the next few weeks. We also plan to offer a similar VRIP to certain Guild-covered employees. Post representatives will be discussing the proposed VRIP with the Guild in a few weeks, consistent with the terms of the labor contract. While this VRIP is similar in some ways to the programs we have offered in the past, it will not be as generous as some of those prior buyouts.

Read Washington Post chairman’s letter to shareholders

Washington Post Co Chairman Don Graham wrote a more than 2,000-word letter to shareholders for his company’s latest annual report. I managed to cut it down to the 587 words that I thought were really worth reading. Graham is the kind of chairman and CEO that you want to cover as a journalist because he seems to rely exclusively on straight talk instead of obfuscation — particularly when the news is bad for the company and for shareholders. Here are the 587 words, with the parts that I found even more interesting than the rest marked in bold type.

We could do without more years like 2008. … In past years, I have rattled on in these letters about our Company’s relationship to our shareholders. Generations of top managers at The Post Company have reiterated: we’re focused on the long run; we’re committed to building value for our shareholders. My own assets are more than 90% concentrated in the stock you own. All of these remain true, but I am in the embarrassing position of writing you after a year in which Post Company stock declined by more than 50%. Comparative results (“you should see what happened to the other newspapers”) offer no solace.

It’s central that you know this: in 1998, about 75% of the Company’s revenue came from The Post, Newsweek and our television stations. In 2008, almost 70% came from Kaplan and Cable ONE.