Issue 1: January/February

Moment of Truth

With the New York Post Hot on its Heels, the New York Daily News must Decide What It Really Is

The New York Post, after decades of swallowing the dust of the New York Daily News in the circulation race, is closing fast in a dramatic sprint, which observers of the city’s rowdy newspaper scene are calling the most remarkable circulation surge in U.S. newspaper history. The Post has not been quiet about this. A May 2002 Post headline: NO CONTEST: WE'RE THE FASTEST GROWING PAPER IN THE U.S. The Post mischievously and regularly snipes at the News, calling it the Daily Snooze, “the city’s slowest growing newspaper,” and, giving its rival’s slogan a nudge, “‘New York’s hometown newspaper,’ which is printed in New Jersey.” When the News’s editor, Edward Kosner — a traditional-style journalist (Newsweek, Esquire) who’d led the paper for three years — announced on July 22 that he was resigning, the Post bared its incisors. NEWS IS IN CHAOS AS KOSNER LEAVES was the headline in seventy-two-point type. The staff at “the faltering Daily News was plunged into turmoil yet again yesterday,” wrote the Post’s media columnist Keith J. Kelly. (An accompanying chart showing the Post’s circulation increase was headed: “You snooze, you lose.”)

The News pretends not to notice, but sometimes it’s hard. Daily News editors denied there was any “turmoil” at the paper, and reminded anybody who’d listen that the main reason for the Post’s growth at the newsstand was that in 2000, owner Rupert Murdoch, in a risky tactic, slashed the single-copy price to twenty-five cents, half the cost of a Daily News. Says Peter S. Kalikow, the New York real estate developer who owned the Post from 1988 to 1993: “You need a lot of balls to lower your newsstand price to twenty-five cents, but if you do it, eventually you’re going to damage your competitor.” Kosner puts it this way: “The Post at twenty-five cents is vanity publishing.” Indeed, the Post — despite its circulation gains — is losing in the ballpark of $25 million a year, according to some estimates. The News is presumed to be marginally profitable, with far higher operating expenses. (Both papers keep their financial information private.)

For the six months ending September 30, the Daily News circulation was 729,124, an increase of 2.1 percent over the same period a year ago, according to the Audit Bureau of Circulations. That’s not bad, but the Post jumped 10.6 percent to 652,426, closing the gap to 76,000 copies, its sixth consecutive double-digit increase. That places the News and Post in sixth and seventh place respectively among all U.S. dailies (after USA Today, The Wall Street Journal, The New York Times, the Los Angeles Times, and The Washington Post). On November 3, the Post trumpeted the new ABC figures in a full-page, full-color article with photos of Cameron Diaz, Sarah Jessica Parker, and Beyoncé flaunting copies of the paper. The same day, a promotional ad dominated an inside page of the News, claiming that unnamed “cheap rivals” were chasing readers outside New York’s city limits, but “only the Daily News puts New Yorkers first day after day.” The Post has, in fact, sought readers elsewhere, especially in California and Florida.

In a memo to the Post’s staff in October, Lachlan Murdoch — the paper’s publisher, son of Rupert — wrote that the daily’s losses are shrinking and that he expects it to break even “in the near future.” Meanwhile, he added: “It is fun to watch our competitors squirm as we . . . take their readers, and their business, from them.” News managers, meanwhile, regularly claim that the Post engages in promotional giveaways and stunts that artificially inflate its numbers.

The Post, in fact, has been so eager to perpetuate its rampaging momentum that on September 24 — in a promotional partnership with AOL and the Dave Matthews band, which performed a free concert in Central Park that evening — it gave the paper away to any New Yorker who wanted it. The News struck back. In a large, three-column photo the next day, slugged POSTMORTEM, a stack of Posts rested on a news dealer’s bench alongside a Daily News metal paper weight. The caption: “They can’t give it away.” The empty spot beside the forlorn Posts was “where the Daily News stack was, but it sold out at its regular price.”

But the Daily News’s most joyful moment in years came on October 17 when the Post, in a nightmarish gaffe, published an editorial lamenting that the Yankees had lost the seventh game of the American League championship series, and that the Boston Red Sox were headed to the World Series. As the world knows, the Yankees had won a famous victory the night before, coming from behind after midnight to prevail in the eleventh inning. The Post had prepared two editorials as press time approached and, in 200,000 copies, ran the wrong one.

WORLD CHUMPIONS! ANOTHER POST EXCLUSIVE, crowed the Daily News, which bestowed the “New York Knucklehead Award” on its rival “for ineptitude so breathtaking that it drew global laughter.”

But a good laugh doesn’t diminish the Post’s serious challenge to the Daily News. And so one question becomes: What’s a besieged newspaper to do when the barbarians are at the gates? The News’s answer: Go out and hire a Fleet Street veteran as editorial director to march into battle against the Post’s furiously competitive Australian editor in chief Col Allan — former boss of Murdoch’s Daily Telegraph in Sydney — who has been running the paper since May 2001.

On September 17, after weeks of speculation in the Manhattan newspaper world about who would succeed Kosner, the News’s owner, Mortimer B. Zuckerman — whose fortune derives from real estate development — hired, or rehired, Martin Dunn, an Englishman who had run Murdoch’s News of the World in London and served time on other splashy British sheets (The Sun, The Daily Mail) as well as editing the Murdoch-owned Boston Herald. Dunn’s hiring came as a surprise to New York’s tabloid-watchers. It would be his second stint at the Daily News; he had edited the paper from 1993 to 1996, then returned to media jobs in England. Before heading back to New York, Dunn told The Guardian:  “The New York Post has been very aggressive. We’ve got to bring a certain amount of that back to the Daily News.” His arrival on the scene in October telegraphed Zuckerman’s conviction that British and Australian editors know how to conduct a tabloid war and Americans don’t.

In another surprise move that tipped Zuckerman’s new strategy, he hired The Washington Post’s celebrated gossip columnist Lloyd Grove. So momentous an event was this among Manhattan’s media tea-leaf readers that The New York Times explored its deeper meaning in a front-page story on September 28. FOR NEW GOSSIP IN TOWN, BUZZ AND DRAWN DAGGERS, was the headline. As the Times saw it, Grove would be “the new prince of gossip . . . the latest bid by The News to siphon some buzz from its age-old rival The New York Post, which considers gossip a stock in trade.” Already in place at the News was the popular husband-wife team of George Rush and Joanna Molloy, who contribute a daily double-truck on celebs and their foibles. They were all being sent into the trenches against the Post’s presiding divas, Liz Smith and Cindy Adams, and the ubiquitous Richard Johnson, proprietor of the paper’s so-called Page Six, the city’s most influential celebrity intelligencer.

Grove’s first column (it’s a five-times weekly page titled “Lowdown”) on September 29 was a curious one. The lead item featured oversized photos of President Bush and his seventy-two-year-old uncle, Jonathan J. Bush, along with a poster for a “Remote Controlled Fart Machine.” The president’s relative, Grove reported, liked giving these $12.99 “flatulence devices” — which produce digitally stored, button-activated noises — as gag gifts. Grove either was introducing a level of subtle irony previously not seen in New York gossip pages, or else he had no better lead item for his debut column.

Beginning last summer, even before the arrival of Dunn and Grove, the Daily News’s front page had suddenly begun looking more like the Post’s — more sex and more celebrities. Examples:

  • On August 14, over the logo, a suggestive photo of a couple lying in bed, and the head: women & sex: they’re having more than they admit.
  • Above the logo on August 24: the babes of the open, pointing readers to two pages of photos of the sexiest women tennis players at the U.S. Open.
  • Page one on August 31 displayed a woman’s shapely legs, a spike-heel shoe dangling from one foot, and the headline: groupies: inside the hidden world of women who chase athletes.
  • Dominating the front page on September 3: large pictures of Jennifer Lopez and Ben Affleck, with ben & jen set the date. Eight days later, across the top of page one (this on the second anniversary of the World Trade Center tragedy): j-no: wedding with ben ‘postponed.’

Is this the right direction for the News?

Pete Hamill, one of two journalists to have served as editor of both the Post and the Daily News, and a New York journalistic legend, doesn’t think so. “If the News decides to be more like the Post, that’s like saying, ‘Let’s be more like the Detroit Tigers,’” last season’s cellar dwellers in the American League.

Lou Colasuonno, the other man who edited both papers, and who worked at the Post for twenty-three years, rising from copy boy to editor in chief, puts it a little differently. “It would be a mistake for the Daily News to attempt to out-Post the Post,” he says.

But the News isn’t mimicking the Post, insists former News boss Kosner. “People mindlessly say that if the News acts like a tabloid, it’s imitating the Post. The News was a tabloid before the Post, and has been doing standard tabloid stuff, although with a big emphasis on original local and investigative reporting. Why shouldn’t the News be lively? It always has been.”

In truth, the two papers are as dissimilar as chalk and cheese. Murdoch told The Economist in 1996: “Outsiders, and even some insiders, don’t understand the difference between the New York Post and the New York Daily News. They have absolutely different audiences. New York is a strange, tribal city.”

The Daily News began life as the New York Illustrated Daily News when Joseph Medill Patterson of Chicago’s Tribune Company family founded it in 1919; within a few years the paper was generating millions in profits and became the largest-selling daily in the country. It was the perfect tabloid, full of energy and aggressiveness. Its motto: “Tell it to Sweeney,” meaning, write in simple language that the average working stiff will understand.

Persistent labor union strife drove the News to the brink of extinction in the 1980s; shutdown costs, because of wage contracts, were estimated as high as $300 million. It’s been quite a ride since. In 1982 Murdoch offered to buy the paper and operate it and the Post (which also was losing millions) as separate entities. Tribune spurned the offer and called Murdoch’s notion “an anticompetitive and predatory act.” The unions made concessions allowing the paper to survive, but after a 137-day strike in 1990-1991, Tribune paid the eccentric British media magnate Robert Maxwell $60 million to take the News off its hands. Eight months later, Maxwell fell or jumped overboard from his yacht, Lady Ghislaine, and drowned. The News filed for bankruptcy. (The Post, too, at that moment was facing bankruptcy.) Zuckerman bought the News on January 7, 1993, fired hundreds of union members, and promptly hired away the Post’s editor in chief, Lou Colasuonno, to run the News in the effort to import some of his competitor’s swagger and appeal. Colasuonno departed five months later when Martin Dunn began his first go-round as editor.

The Post, meanwhile, was founded back in 1801 by none other than Alexander Hamilton. Murdoch has owned the Post twice: first in 1976 when he bought it from the banking heiress Dorothy Schiff, who had made the paper the most left-liberal daily in the U.S. It was the favored paper of Upper West Side intellectuals and Greenwich Village bohos, but many news dealers in the prosperous New York suburbs refused to sell the Schiff Post in the fifties and sixties, calling it commie propaganda. Murdoch quickly pushed the Post’s politics to the opposite end of the spectrum. The Post endorsed Ronald Reagan for president in 1980 and, later, the Republicans Rudolph Giuliani for mayor and George Pataki for governor. Those choices made Murdoch a power broker in New York City, amortizing, in political influence, his investment in a tottering newspaper

But Murdoch was after bigger game. He peddled the Post in 1988 to expand his world reach into television and satellites. To buy a string of TV stations, including New York’s WNYW, Murdoch sold the paper to comply with a Federal Communications Commission rule barring a company from owning a television station and a newspaper in the same city. (Ironically, Tribune owned both the Daily News and WPIX-TV under a “grandfather” provision in the same rule.) Peter Kalikow, a real estate developer with zero news experience, paid $37.6 million for the Post — which was deeply in the red — after union concessions shaved $24 million from the paper’s operating costs.

Murdoch bought the Post for a second time in 1993 in perhaps the most chaotic and farcical episode in U.S. newspaper history. A plot summary: Kalikow declared personal bankruptcy and prepared to shut down the Post. A bankruptcy judge approved the sale of the Post to a mystery figure, one Steven Hoffenberg. Hoffenberg’s company, Towers Financial Corp., a debt-collection firm, was under scrutiny for fraud by the Securities and Exchange Commission; civil suits faced him in a score of states. Joining Hoffenberg as a partner was Abraham J. Hirschfeld, seventy-three, a zany, eccentric owner of New York parking lots.

Together, they had neither the talent nor the resources to operate the paper. (n.y. post goes bonkers, said a headline in The Washington Post.) Before they could assume ownership, Murdoch offered to buy the Post to save it from extinction — if the FCC would waive its cross-ownership roadblock. New York’s governor, Mario Cuomo, although often the victim of Murdoch’s editorialists, went to bat for the Australian with the FCC. Murdoch got his waiver and greeted cheering employees on March 29 at the Post’s offices, like MacArthur returning to the Philippines.

The Post is now a fiefdom of Lachlan Murdoch, thirty-two, who says he hopes to have the paper in the black in three years. “We are engaged in the most exciting newspaper battle in America and maybe the world,” he told Ken Auletta, The New Yorker’s media reporter, in 2002.

It’s a big test for the youngster, who needs to persuade his father that he’s up to the task of running News Corp. ($17.5 billion in revenues in 2003), as well as the media empire’s other businesses around the world. The Post, Murdoch’s only newspaper in the U.S., represents less than 1 percent of the conglomerate’s total income. Its advertising, while on the rise, still trails that of the Daily News: $125 million in 2002, against the News’s $410 million, according to TNS Media Intelligence/CMR, which tracks ad spending.

But even if the Post surpasses the News in circulation, it faces an endemic, structural problem that may forever bar it from a comparable surge in advertising. Roughly 60 percent of News readers purchase no other daily paper; the figure for the Post is about half that. Thus, department stores and other large advertisers can reach prospective customers efficiently by choosing the Times and the Daily News, knowing that the Post, for many readers, is a supplementary read and superfluous to their needs. Post readers, demographically, are just as desirable as News readers, but, alas, they’re also folks who’ve probably read another paper that day.

One tactic that could free the Post from that economic box is to transform the paper into a launch pad for a national tabloid. Satellite printing technology allows papers like The New York Times, USA Today, and The Wall Street Journal to publish at multiple sites around the country, making them national news organs. Knowledgeable strategists claim that if the Post did the same, it might gain a few hundred thousand circulation and suddenly become a vehicle for national newspaper advertising.

In a speech in Sydney, Australia, in December 2002, Lachlan Murdoch said he was proud of the company’s “ability to cater to all members of society. Our lack of loftiness is a point of distinction.” Loftiness, in fact, has never been an aspect of New York’s battling tabloids.

Each agonizes daily over the “wood” — the inches-high type on page one — so-called because in an earlier era the letters were carved from oak. The most famous wood is the Post’s 1983 headless body in topless bar. The News made tabloid history with its 1975 wood condemning President Gerald Ford’s failure to help the city out of its fiscal crisis: ford to city: drop dead. “We hated it when we had the same front-page story as the News,” says Jerry Nachman, editor of the Post from 1989 to 1992, now the editor in chief of MSNBC. “We figured the reader was going to walk past a newsstand on the way to the subway and make a quick decision based on the wood. We wanted to stand out.”

Standing out is becoming marginally tougher for New York’s tabs. Newsday, Tribune Company’s Long Island-based tabloid, sells papers in Manhattan, Brooklyn, Queens, and the Bronx. Also: Tribune launched a free daily tabloid in October called amNew York, aimed at eighteen- to thirty-four-year-old urban commuters. Then there’s The New York Sun, a nearly two-year-old, politically conservative broadsheet (daily circulation 40,000) backed by Hollinger International, which sports a mix of national, international, and local news. And then there are a host of weeklies and a thriving immigrant press, in a city that now is more than a third immigrant. Not to mention TV. The News and the Post are battling more than each other.

The News staff’s mood ranged “between dour and really goddamn depressed,” The New York Observer reported in its Off the Record media-news page, as Kosner departed and Dunn arrived. Few had been cheered when management mustered top editors last summer to hear a critique of the paper from Iain Calder, former editor of the supermarket scandal sheet the National Enquirer. Or when Steve Coz, editorial director of American Media’s roguish tabloids (the Enquirer, The Globe, The Star) was in talks with Zuckerman for a possible upper-level job with the News. (He didn’t get it.)

The News’s faith in the selling power of sex showed hints of continuing after Dunn’s arrival on October 15. A photo on October 21 pictured a blonde reclining in a bathtub, apparently nude, covered only by apples, her nipples concealed by pasties bearing the name of an apple-flavored soft drink. When the headmaster of an elite private school (nursery through twelfth grade) was arrested and accused of attempting to e-mail pornography to teenage girls, the Daily News’s page-one head on October 28 read: porn master. On October 29, the News gave page one to Dennis Kozlowski, the embattled former ceo of Tyco, calling him the lust tycoon for a $2 million, weeklong birthday bash — complete with guests in skimpy Roman togas — which he had thrown for his wife in Sardinia.

Veteran News people thought they saw some handwriting on the wall. Was the News planning to wage tabloid warfare with the Post’s weapons of choice? Would it grow to look more and more like the Post, as the best tactic to retain its readership lead? Did Rupert Murdoch and his Australians have the only workable formula for appealing to big-city subway riders who already have their news “meal” from The New York Times and The Wall Street Journal, and want a newspaper that’s fun for dessert?

What the News needs to learn, according to Fran Wood, a former deputy managing editor at the paper and now an op-ed columnist and editorial writer for the Star Ledger, across the river in New Jersey, “is how to play important news on page one and still put that tabloid spin on it. Then you don’t end up with J-Lo on the front page.

The News missed a chance to do that on October 10 when the paper’s Washington bureau chief, Thomas M. DeFrank, in a page nine story slugged exclusive, reported capital sources as saying that President Bush had “deep unhappiness with his national security team,” and that Secretary of Defense Donald Rumsfeld would be fired after the November election. The article might easily have made an informative, tabloid-style, attention-grabbing front page. Instead, the News offered an update on basketballer Kobe Bryant’s sexual assault case.

Ominously for the News, the confrontation with the Post sometimes looks like a replay of the cable news war, in which Murdoch’s Fox News Channel — with its videogame graphics and unabashed political conservatism — has, against all odds, overtaken and surpassed CNN’s viewership, causing the older, less flashy network to adopt aspects of Fox’s style. David Cole, editor of the trade journal NewsInc., points out that “No other newspaper in America is gaining the kind of circulation that the Post is. In a news marketplace, you have to decide if you’re going to let your competitor do that, or compete. Mort may go downmarket against the king of downmarket, Rupert Murdoch.”

Yet close students of New York newspapering think that these days, the News has the best metropolitan coverage in the city, including that of The New York Times. It boasts well-staffed bureaus in Brooklyn, Queens, and the Bronx, and publishes special zoned editions for those boroughs. Jon Fine, media reporter for Advertising Age, points out that “the Post leans heavily on columnists, some of whom are excellent, but it’s playing a different game than the News. The Post isn’t a daily newspaper in quite the same way, and that allows it to be more fun, more entertaining. That’s what Zuckerman has to contend with. In a certain way, the Post is reinventing what a tabloid is. News readers, for their part, expect something more sober, more complete, and that’s an expensive game to play.”

Among the Post’s strengths: some topnotch coverage of business and personal finance, as well as regular scrutiny of the worlds of big media and fashion. Recently, it launched a monthly section called Tempo that niftily reports on Hispanic culture in the city.

But when major local news occurs, the News, with its greater resources, tends to come out on top. The paper scrambled the jets admirably on August 14 when the city and much of the Midwest suffered the great blackout of 2003. Powered by a diesel-fueled generator at its printing plant in New Jersey, the News produced a comprehensive twenty-seven-page blackout special and printed a million copies of the paper. The Post’s plant in the Bronx, meanwhile, had no electrical power, and the paper managed only seven pages of blackout coverage and 250,000 newsstand copies, using a plant borrowed from The Record in Bergen County, New Jersey. The News’s victory was especially sweet because its plant has been plagued for years with technical glitches; worse, its trucks must cross both the Hudson and the East Rivers via traffic-choked tunnels and bridges to deliver papers to Brooklyn and Queens. The Post’s managers regularly boast, accurately, that their own newer, sleeker $300 million plant (opened in 2001) is far better situated for fast delivery to newsstands and is perhaps the best plant in the country, with top-quality color reproduction.

The News’s superior firepower was apparent again on October 15 when a Staten Island ferry smashed into a dock, killing ten passengers and injuring hundreds. The News deployed thirty-eight reporters and produced thirteen pages of coverage. The Post managed just eight pages that included two pages taken up by three wire-service photos.

The Daily News easily outsells the Post and The New York Times in four of New York’s five boroughs — Brooklyn, the Bronx, Queens, and Staten Island. The Times is the dominant paper in Manhattan, but the Post is running neck and neck with the News there. In spite of the News’s greater assets, former Post editor Nachman says: “I always found it surprisingly easy to compete against the News, which always felt it had to acquit itself for being a tabloid rather than reveling in its tabloidism. They had good stuff, but they never knew how to wave their tits. The Post knows that a tabloid is about fast women and slow horses. One thing I like about Australian editors is that they don’t worry about what people think of them. Rupert has been successful not despite that, but because of it.”

Can the News find a strategy to remain the more sober and substantial of the two while still showing a little leg? Maybe it can. By mid-December, eight weeks into Dunn’s term, the paper’s front page was noticeably more sprightly, with above-the-logo headlines on Halle Berry, the Beatles, Russell Crowe, and Victoria Secret’s alluring lingerie, as well as photos of Britney Spears and the hotel heiress Paris Hilton, with the words all sexed up! But inside pages contained useful coverage of Washington plus a number of noteworthy investigations. Examples: a report on lawyers who swindled $1 million or more from clients; an exposé of how drivers in New York who kill pedestrians rarely face serious criminal charges; and a double-page on the plight of tens of thousands of immigrants forced to live in illegal, deathtrap apartments.

What’s the long-term outlook for the squabbling New York tabs? The wrong assumption, says Ed Kosner, is that there isn’t room for both. “If they were run like Gannett and Tribune, public companies wanting consistent profitable quarters, that would be different.” But they’re operated like private companies by two galvanic entrepreneurs willing to compete with their own money. “That’s capitalism,” Kosner says. “This can go on for a long time. Mort will make a little more money and Rupert will lose a lot more. So what?”

New York newspaper buyers may be the winners. If you want to know what’s going on locally in New York city, says the former Post owner Peter Kalikow, “you have to read the Post and or the News. You cannot hope to get it from the Times. The tabloid folks are on the money. That’s what competition does, and while that competition is going on, it’s great to be a newspaper reader in New York.”

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