“tronc If You Want to Save Journalism” — how to report a writearound
When Michael Ferro acquired Tribune Publishing in February, most people outside of the Chicago business community hadn’t heard of him. Since rebranding the company into “tronc” and promising to save journalism, Ferro has faced widespread ridicule while remaining an unknown quantity in the newspaper business.
Ferro’s largely untold history is what makes Felix Gillette and Gerry Smith’s Bloomberg Businessweek article about the man such a fascinating story. “tronc If You Want to Save Journalism” explores Ferro’s trial-run in the newspaper business, a peek into what could be tronc’s future. Ferro bought the Chicago Sun-Times with a group of investors at the end of 2011. He took an active role in the digital business strategy as chairman of the newspaper’s holding company, and later donated away his shares after acquiring Tribune Publishing, which put him in charge of competitor Chicago Tribune.
The piece focuses on Ferro’s strategy at the Sun-Times and paints a portrait of a man that looks like “the biz dev guy at the airport sports bar who talks your ear off during Monday Night Football.” The profile is a writearound, since Ferro declined to be interviewed, but effectively picks up on the color of the man’s personality and business ideas. The piece gives insight into Ferro’s possible direction for tronc, a newspaper empire that also includes the Los Angeles Times, the Baltimore Sun and the Orlando Sentinel.
Tronc/Tribune Publishing has suffered through financial turmoil for more than a decade. In 2007, Chicago real estate businessman Sam Zell took the public Tribune Co. private, leaving Tribune Co. with $13 billion in debt. The company immediately filed for bankruptcy in 2008, and didn’t emerge until 2012, then under control of its creditors. In 2014, the company spun off the newspapers and $350 million of debt into Tribune Publishing, and the TV and digital assets into Tribune Media. Then in February 2016, Michael Ferro used his investment company to purchase a controlling portion of shares in Tribune Publishing, making him owner.
In April, Gannett gave an unsolicited offer to buy Tribune Publishing. Ferro initially rejected the offer and then gave a surprising announcement.
A wider audience started taking notice of the company, including Jon Oliver, when Ferro renamed the company “tronc” and announced a new digital strategy with buzzwords such as “machine learning” and “artificial intelligence.” To let the new effort speak for itself: “One of the key ways we’re going to harness the power of our journalism is to have an optimization group. This tronc team will work with all the local markets to harness the power of our local journalism, feed it into a funnel, and then optimize it so that we reach the biggest global audience possible.” If you’re not sure what that means, you’re not the only one. Or as Recode put it: “We’re still not convinced these Tronc branding videos aren’t Adult Swim parodies.”
Gannett came back at a higher price, Ferro reconsidered, and the potential deal was still playing out when Gillette and Smith began working on their piece in August. Gillette, who writes about a range of industries, became interested in Ferro because he was a charismatic character preaching a message counter to the drumbeat of depressing news that usually comes out of the newspaper industry. Smith had been covering the deal in his role as a media reporter.
“He’s in control of these iconic papers like the L.A. Times and Chicago Tribune, and a lot of people are wondering, ‘What is he going to do there?’” Smith said. “To go back in time a little bit and look at some of the ideas he had when he was running the Chicago Sun-Times I think gives a pretty good illustration of who he is and maybe whether or not he’ll be successful in this new venture.”
Ferro said he could create a successful business model for tronc using technology, and Gillette and Smith wanted to evaluate Ferro’s earlier business ventures and tie the threads together for readers. Gillette focused on Ferro’s business record and recent ownership at the Chicago Sun-Times, and Smith focused on what had happened at the L.A. Times since Ferro took control.
The two wanted the story ready for when the Gannett acquisition succeeded or failed. Either way, the story would be relevant. If Gannett bought tronc, Ferro was still a wealthy entrepreneur interested in the future of news. And if the deal failed, then Ferro would remain in charge of tronc, left to deliver on his promises of a bright future for the company.
Smith and Gillette first approached Ferro and said they wanted to write a profile about him, but Ferro declined. They carried on anyways. “I think what the piece shows is that you can still write a really rich profile of someone without actually getting their cooperation,” Smith said.
Gillette used the Nexis database to look up all news coverage about Ferro since he entered the public light in the 1990s. “(The) first step is to just go back and do the thing that reporters who are covering daily news and incremental coverage of these companies don’t have the time to do, or the luxury,” Gillette said, “Which is to go back and read every single thing that you could possibly find about this person and the companies they’ve been involved with.”
This method also gave Gillette a road map of people to contact. While reading, he made a list of people who had been part of Ferro’s former companies, such as Click Interactive, which Ferro founded in 1996 and sold in 2006. He also used LinkedIn to find former and current employees. Smith used similar methods, and together they reached out to dozens of people. “It becomes a grapeshot method,” Gillette said. “Just as many names as possible, in as many different capacities. You’re really gonna end up with a mosaic portrait of this person so you really want to cast as wide a net as possible.”
The response rate was often low, but Gillette was expecting that. He also spoke with many sources on background, not for attribution. This allowed people to feel comfortable speaking with him candidly. Dozens of interviews with former and current employees allowed Gillette and Smith to build a picture of what had happened at Ferro’s previous and current companies and what Ferro is like as a person. Gillette also watched a video on Youtube where Ferro spoke about his acquisition of the Chicago Sun-Times.
The two also asked Ferro, through a spokesman, for sources that could speak on his behalf. They wanted a more well-rounded and fair perspective of tronc’s owner. The article opens with an interview with Lupe Fiasco, a fan of Ferro’s and one of multiple sources his spokesman said they should contact. “If you don’t participate and you tell your friends not to participate, the whole story is just going to be people who don’t like you,” Gillette said.
Smith and Gillette also gave Ferro an opportunity to respond to their reporting through the spokesman. This is why some parts of the story are described through unnamed sources, and then followed by Ferro denying the incident.
Two themes emerged in the story. The first is that while Ferro can be a fountain of ideas for new digital revenue streams, not all those ideas are good, and he can lack execution. The second theme answers why a technology investor suddenly started caring about journalism: Ferro loves being part of the celebrity world.
Ferro says he will save tronc with technology, but Gillette heard from people at the Chicago Sun-Times that there was often a disconnect between what Ferro promised and what he delivered. For example, Ferro decided to develop a content management system called Hermes and license it out to other publications, which Jeff Bezos has successfully done at the Washington Post since purchasing the newspaper in 2013. But according to staff members Gillette spoke with, Ferro didn’t devote enough resources to the new software. As the story explains: “Hermes was rife with problems and was eventually shut down. Frustrated employees had taken to calling it ‘herpes.’”
After hearing that nickname from multiple sources, Gillette thought it was, “A perfect detail for the level of unhappiness with the software and the technology side at the newspaper.” Investors and readers want to know what’s going to happen with tronc, a much larger company, Gillette said, and a detail such as this one gives insight into whether Ferro will be able to create a technological advantage over tronc’s competitors.
Gillette also heard from every Chicago Sun-Times source about their surprise at having celebrities such as Lupe Fiasco and Jenny McCarthy just walking around the newsroom, a sharp contrast to the newspaper’s reputation for gritty crime and city hall reporting. “One of the things he liked about the Sun-Times is that it was a way of continuing to build his network, and it gave him access to people that in the past really wouldn’t have been pulled into his sphere of influence or crossed paths with him necessarily, particularly Chicago celebrities,” Gillette said.
As this theme arose from his reporting, Gillette said it gave new meaning to a flap at the L.A. Times. Soon after acquiring Tribune Publishing, Ferro and other executives took all six of the L.A. Times’ tickets to the Oscars, leaving reporters unable to cover the event. After the staff complained, Ferro gave them back two tickets. He had also sought out tickets to the Academy Awards while owner of the Chicago Sun-Times, but the newspaper didn’t have any.
After Gillette and Smith finished writing in September, Bloomberg Businessweek sat on the story. Then Gannett withdrew its offer for tronc on Nov. 1. The two listened to tronc’s earnings call that day, updated a few paragraphs and then ran the story on Nov. 2.
What happens to tronc next is up to Ferro. Thanks to Smith and Gillette’s story, investors and people who care about the company’s iconic newspapers now have a better grasp of what that future could hold.
With the potential deal looming during the reporting process, Gillette said he asked sources whether they wanted Ferro to run the company, or Gannett. Despite the widespread ridicule, he said the common sentiment was that Ferro was at least trying something new.
On one hand, Ferro is a wildcard, sources told Gillette. Even people critical of Ferro gave him credit for being a good networker and salesman able to convince people to give his ideas a shot. Gillette heard the hope that, “Maybe he’ll just spin out all these ideas and one of them or two of them will turn into actual, good business ideas.”
On the other hand, everyone knew what would happen if Gannett bought the company. “Their mandate is to find synergies in these companies,” Gillette said. “And what that means is essentially cost saving, and so they’re going to be cutting, cutting and cutting, and it’s hard to get particularly excited about that.”