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SPECIAL REPORT / CROSSING THE LINE

Crossing the Line

A Los Angeles Times Profit-Sharing Arrangement With Staples Center Fuels a Firestorm of Protest in the Newsroom--and a Debate About Journalistic Ethics

December 20, 1999|DAVID SHAW | Times Staff Writer

Lindsay says he came away convinced that the magazine had been ruled out for Staples coverage, that there would be no editorial section of any kind. McKeon says he came away convinced that if the sports department was determined to do a special section on Staples Center, it would be foolish to also do an advertorial section. The two would compete with each other for advertising to the probable detriment of both financially. McKeon also didn't like the idea of two separate magazines on the same Sunday--the regular magazine and a Staples stand-alone special. They would also compete with each other for limited advertising dollars.

Lindsay offered to suspend publication of the regular magazine that Sunday to avoid any conflict; the magazine already "went dark" on several holiday weekends when advertising was light, so this would not be unprecedented. McKeon had been at The Times only about four months then, though, and he wanted to improve the fortunes of the magazine, not diminish them; he wasn't eager to have it skip publication one week. He wasn't certain what he did want to do yet, he says, but other participants say that he seemed inclined to join Lindsay and Arthur in opposition to using the magazine for Staples. Helin felt the same way.

For the Record
Los Angeles Times Monday December 27, 1999 Home Edition Part A Page 3 Metro Desk 2 inches; 39 words Type of Material: Correction
Investment conference--Participants in the Philadelphia Inquirer investment conference are selected by members of the paper's newsroom staff but, contrary to what was reported in The Times last Monday, they are invited by Morningstar, the co-sponsor of the conference.

Profit-sharing? All the business people present say they thought it had been mentioned and no editorial opposition had been raised. Is it possible that the business people so took the profit-sharing agreement for granted, and assumed their editorial counterparts already knew about it and had no objection, that they didn't specifically mention it at that meeting? Is it possible that, with the contracts available for all to see, profit-sharing was mentioned only briefly and in a kind of offhand shorthand that, as Helin suggests, "didn't ring a bell in the context" with editors who were preoccupied by other concerns and convinced that the magazine wouldn't be involved anyway? Even Arthur concedes that's possible.

"We didn't debate it," Helin says. "The $300,000 commitment was set; the editorial focus was on positioning--where to do the Staples coverage."

A Different Focus

Sean Riley, who also attended the meeting, having taken over as general manager of the magazine, thinks this is a likely scenario. Lindsay is so committed to defending the editorial department against business intrusions, and was so opposed to devoting an entire issue of the magazine to the Staples Center, that if the profit-sharing arrangement had registered with him, Riley says, "It would have been his trump card."

But is it really possible that something so volatile and damaging as sharing profits on an editorial section of the paper with the subject of that section's coverage was mentioned and just "didn't register"?

Yes, says Dick Stanton, the paper's chief operating officer. He was not at that March 4 meeting and doesn't profess to know anything about it, but speaking of other meetings he's attended with editors, he says, "The Times has a renowned editorial department in part because it focuses on editorial. People in editorial don't focus much on the business side. They are very smart people, but this is not what they focus on."

CHAPTER FOUR / The Decision

Eleven days after the March 4 meeting, the questions of how to cover the Staples Center opening and how to fulfill the revenue-sharing agreement were still unresolved. In a memo dated March 15 and addressed to James Helin and John McKeon, Kelly Sole, who had taken over from Sande as general manager for the Sports section, said the three original options were still under consideration. She recommended either the stand-alone magazine or an advertorial section, not the Los Angeles Times Magazine.

She did not have the final say, though, and in the next two weeks, sentiment shifted. Some on the business side argued that a special issue of the magazine on Staples Center wasn't much different from the special issue the magazine had published in December 1997 to mark the opening of the Getty Center museum, and that issue had been quite successful, with enough advertising to publish a 92-page issue.

But John Lindsay, John Arthur, Alice Short, the magazine editor, and several of her subordinates remained opposed. Getty and Staples were very different, they argued. The museum was a nonprofit cultural institution of international significance; Staples Center was a profit-making arena of largely local interest.

"It was bad idea," says Bob Sipchen, a senior editor at the magazine. "I thought it had a funny smell to it from the very beginning. . . . This was a train wreck waiting to happen."

Seeking a Plan

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