Pre-Scripps-ion for Success

Boldly Leading the

Digital Age FAMED MEDIA CONGLOMERATE IS INVESTING IN NEW MEDIA PLATFORMS FOR THE 21ST CENTURY

By Mike Boyer

Rich Boehne, chairman and CEO of E.W. Scripps Co.

R

ich Boehne, chairman and CEO of E.W. Scripps Co., doesn’t have to go far to glimpse the 135-year-old media company’s future.

Just one floor above his 28th floor office in the Scripps Center downtown is the company’s startup digital division.

Five years removed from the spin-off of its highly success cable TV franchises— HGTV, DIY Network, Food Network among others – into publicly traded Scripps Networks Interactive Inc., Boehne thinks the digital business could someday be just as big.

“If you look in general at the size of the opportunity, then yes, it’s an enormous business opportunity,” he says.

But Boehne adds: “It’s an opportunity for a few, not a lot. It’s time to be in one of the lead positions.”

Scripps, which owns 19 televisions stations including WCPO-TV, Channel 9, in Cincinnati and newspapers in 13 markets, 82

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is spending up to $22 million this year to build its digital business for smart phones, tables, laptops and desktops.

It has consolidated digital development for TV and print across the company on the 29th floor under former investigative reporter Adam Symson, now senior vice president and chief digital officer.

Scripps is hiring up to 150 sales, design, marketing and news people to staff the digital unit, with the help of a $750,000 city tax incentive. It is also adding up to 100 digital-only sales people across the company’s markets this year and is introducing technology to improve the selling process.

Last year digital revenues across Scripps were about $40 million, less than five percent of total revenues of $903 million.

It expects to double digital revenues by 2015 the company told investment analysts in May. And Scripps shares lately have been on

a roll, hitting a new 52-week high in early July of more than $17 a share, in the wake of big TV station buys by Gannett Inc. and Tribune Media. But just five years ago, following the Scripps Interactive spin-off and the financial crisis in 2008, Scripps revenues plunged and its shares fell to under a $1.

“It was ugly,” recalls Boehne. “It was hard to walk down the street. People would have a look in their eyes. I remember thinking: Well, this is what it’s like when people think you are seriously ill and not going to make it.”

There were tough decisions. Boehne closed the money-losing Rocky Mountain News in Denver in 2009.

“It was one of America’s greatest newspapers. It was horrible, terrible,” he says.

Boehne, who grew up wanting to be a journalist and covered Wall Street and the economy for The Cincinnati Post before joining Scripps’ corporate staff in 1988,

PHOTOS BY MARK BOWEN MEDIA

Adam Symson leading a meeting

says, “I wonder if I’ll get into heaven after doing that.”

But he says the News was bleeding “tens of millions of dollar a year. There was no end in sight. So it was a question of should the rest of the company have to subsidize one market.”

Scripps used the tough times to sell some assets like the Peanuts comic strip characters and refocused on building a news company for the future.

Ed Atorino, media analyst with Benchmark Co. in New York, says while Scripps TV stations have been doing well, it needs digital revenues to outpace shrinking print ad sales. He says the jury’s still out on the digital business.

“Digital isn’t a be all, end all,” he says.

Boehne, who was named chairman in May upon retirement of Nackey E. Scagliotti, a great-granddaughter of founder Edward W. Scripps, believes the digital media business is at a tipping point.

“We are at that turning point for digital where consumers understand how it works,” he says. “Mobile has risen as a platform where most things are paid for instead of free.”

Smart phones are becoming the new universal platform for news, entertainment

and social interaction.

At same time, he says, f i rst newspapers a nd increasingly TV stations appreciate that they can’t continue to give away their best content for free.

Scripps has implemented pay metering systems for digital content in its newspapers. “Much of what you see or have seen for free is not sustainable as free,” he says. “People say, yes but I can get it for free. Well, that’s not going to last.”

It isn’t media convergence Scripps is pursuing, but content consumers are willing to pay for and delivering it the way they want to receive it.

“There’s this notion that what we’re doing here is technology,” says Symson.

“Really, what we’re doing here is just the next evolution of journalism.”

Recruiting for the digital division, Scripps seeks people with diverse backgrounds. But one thing they must share is a sense of mission.

“We’re not interested in people coming to work for us who would be just as happy writing code,” says Symson, who has the words of the first amendment guaranteeing press freedom on a poster above his desk.

“They have to have a specific passion for what we do in our communities.”

Scripps is tailoring digital content in different ways.

“People expect different things from different devices,” he says. “In a tablet app, we’re trying to give people a magazine-like experience and we know people are sitting at the breakfast table reading their tablet just like they’re reading their newspaper.”

For the smart phone consumer, he says: “It’s about snack size consumption. So we focus on greater sense of urgency and smaller bits of information.”

Scripps is also reshaping its newsrooms to cover the content customers want.

For its newspapers, it might mean posting digital traffic updates for accidents it wouldn’t cover in print.

“If somebody is sitting on the freeway and they want to know why. You better tell them why,” he says.

At the same time, Scripps is exploring more in depth digital coverage at its TV stations beyond the traditional staples of breaking news, weather and traffic.

AT WCPO, Scripps created a digital first desk under managing editor Chris Graves, a former online editor with The Enquirer, with a staff of eight including business reporters Lucy May and Dan Monk, both formerly with the Cincinnati Business Courier. “This is our Petri dish,” says Boehne.

Undoubtedly, Scripps’ most successful digital endeavor to date is its Storm Shield local emergency weather radio app, selling for $4.99 for iPhone or Android devices.

It offers storm-based alerts via voice and push notifications for up to five locations as well as locally tailored commentary by meteorologists such as Channel 9’s Steve Raleigh.

Since its introduction last year, Symson says Storm Shield is generally among the top ten paid weather apps nationally and in mid-June was among the top five among all paid apps including games.

Scripps is exploring other ways to deliver news and information such as social gaming through FiveOneNine Games, a joint venture with Capitol Broadcasting.

Political Rampage, an early attempt built around the election, wasn’t a success.

“It sucked, that was the problem,” says Boehne succinctly. “But that’s how we learn.”

Scripps has a tradition as an entrepreneurial media company, dating back to Edward Scripps borrowing $10,000 to launch the Cleveland Penny Press as a paper for the masses. It continued with early investments in broadcast TV, cable and cable networks.

“We’re very comfortable with creative risk,” says Boehne.

But he adds the creation of Scripps digital strategy doesn’t mean the company is de-emphasizing its print or TV businesses.

Boehne, who started selling phone subscriptions to the old Cincinnati Post as a teenager, says he can’t envision Scripps not in the newspaper business.

“But I don’t look at the company that way any more. I look at it by platforms for print, television, smart phones, tablets, laptops and desktops. Even in our newspaper markets we have a print business and a digital business.”

In the future, he says, “There’s a very good chance there are people who will only love us their entire lives on a smart phone, and we have to love them back.” ■ w w w.

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