Washington Loses a Newspaper

By Janice Castro

After investing $85 million, Time Inc. shuts down the Star

Rumors of its impending demise had been circulating for a decade. Legions of readers and advertisers had defected, pushing losses to intolerable levels. But the Washington Star gamely hung on, and in 1978 it got a reprieve: Time Inc. bought the paper for $20 million and pledged $60 million for its revitalization. Said James R. Shepley, then Time Inc.'s president and later chairman of the board of the Star: "It is vitally important that the greater Washington area continue to have the services of two strong newspapers." But last week, after an expenditure of $85 million and after-tax losses of $35 million, the company admitted it could no longer postpone the inevitable. Said Time Inc. President J. Richard Munro: "Despite our substantial investment, the newspaper continues to lose money and shows no prospect of a turnaround. Regrettably, we feel we have no choice but to close it."

The company set the closing for Aug. 7, in the slim hope that a dark-horse buyer would come forward during the two-week grace period. Otherwise the nation's capital will be left with only one major newspaper, the Washington Post (daily circ. 618,000). This was cause for mourning in a city where decision makers depend on a full and vigorous airing of important public issues. "An extremely sad day," said President Ronald Reagan. Added House Speaker Tip O'Neill: "We ought to have newspapers expressing opposite philosophies." Even the victor in this journalistic struggle did not celebrate. "The demise of the Star," said Post Publisher Donald Graham, "is dreadful for Washington and for anyone who loves newspapers."

Time Inc. executives were satisfied that they had given the Star their "best shot," as Munro put it. The paper recruited top talent, including Denver Post Cartoonist Pat Oliphant and Washington Post Writer Judy Bachrach, added a second op-ed page and started a morning edition. National and international coverage --long a weak point--were bolstered with the worldwide resources of the Time-Life News Service. Five new community editions broadened the metropolitan coverage. Under Editor Murray J. Gart, 56, former chief of the Time-Life News Service, the Star stressed hard news and straightforward reporting over fancy writing and instant analysis. The paper won two Pulitzer Prizes (for editorials in 1979 and criticism in 1981) and numerous other awards. Said Henry Grunwald, Time Inc. editor in chief: "Many observers, including very sharp critics, have said that the Washington Star is the best afternoon daily in the U.S. I would go further and say that it is one of the three or four best and most responsible newspapers, morning or afternoon, in the country."

Unfortunately, its circulation and advertising figures did not improve along with the editorial product. The downward march paused briefly in 1979, but resumed when the local economy slumped and the Star stopped offering cut-rate subscriptions, an enticement for new readers that proved too costly. After 3 1/2 years, daily circulation had slipped from 349,000 to 323,000 and Sunday totals had dropped from 337,000 to 294,000.

The turning point for the Star was 1954, although no one knew it at the time. It was then that the Post acquired the Times-Herald, more than doubling its own circulation and securing a monopoly in the morning. Instead of starting a morning edition to compete with the Post, the Star stood pat. Conservative in politics and outlook, the Star's proprietors failed to recognize that Washington was becoming a far more liberal and sophisticated place.

The Star's plight was similar to that of other big-city evening papers, which lost about 20% of their circulation between 1965 and 1979. The flight of city dwellers to the suburbs and the gradual postwar shift from a blue-collar to a white-collar work force have created an audience predisposed to morning papers. Today's reader goes to work later and has less time for reading a newspaper at the end of the day. Although television coverage offers less depth, it can provide much fresher news: many evening papers go to press before midday so that delivery trucks can beat the evening rush hour.

More important than its troubles in the afternoon, the Star could not buck the deeply entrenched Washington Post. Acknowledged Munro: "We were either naive enough or unrealistic enough to think we could come in and steal some of the market share from one of the most powerful newspapers in the country." Throughout Time Inc.'s ownership, the Post was able to hold on to 75% of the city's newspaper advertising. In tight economic times, advertisers cling to the dominant paper. Says Chicago Sun-Times Publisher Jim Hoge, who tried and failed to save that city's evening Daily News: "Once you get deep in the hole, it is almost impossible to get out."

In hindsight, some newspaper experts fault the Star's editorial strategy, although their analyses are often contradictory. Some argue that the paper should have stressed soft features and service articles, since the Post already offered a comprehensive package of local, national and foreign news. On the contrary, argues Ben Bagdikian, former Post national editor and now a journalism professor at the University of California at Berkeley: "I would have gone head to head against the Post in the morning . . . with a steady diet of authoritative, detailed pieces."

Time Inc. studied these possibilities but found serious flaws in all of them. Says Grunwald: "I am convinced that the 'soft feature' approach would not have worked in the long run. As for converting the Star to a morning paper, we concluded that it would have been prohibitively expensive." The editors also considered turning it into a racy tabloid, but quickly rejected that idea as being contrary to the company's editorial tradition. Moreover, it is far from certain that such a drastic change in the Star's character would have succeeded commercially. Says Washington Publishing Analyst John Morton: "There wasn't any real solution to the Star's problems."

Finally, Shepley approached the Post two months ago and proposed that the two papers combine printing operations while maintaining separate editorial staffs.* After five discussions, the idea was abandoned. Says Shepley: "They had projections of profit margins and benefits to their paper that they wanted to ensure. We weren't able to work out a way to meet their requirements and at the same time to sustain the Star."

The Star's 1,427 employees were shocked by the prospective death of the paper they had struggled so valiantly to save. Those arriving at work early last Thursday were given the grim news by their supervisors; others heard it on their car radios or read it in a black-bordered announcement on the Star's front page. Said Sports Columnist Morris Siegel, 61, whose 19th anniversary with the paper coincides with its closing: "For once we beat the Post on the big story--damn it to hell." Editor Murray Gart (who had observed earlier: "I'm as intensely proud of the staff of the Star as any editor can be") presided over a wake. Staffers sipped champagne while checking the cluttered newsroom bulletin board for job openings at other papers. Late in the afternoon, a message from Katharine Graham, board chairman of the Washington Post Co., was tacked up: "Dear Murray," she wrote, "my heart is broken for you." On seeing the note, some staffers jeered.

Morale was low in recent months, partly from the strain of being on an apparently sinking ship. At the end, some Star hands expressed anger. Pulitzer Prizewinning Syndicated Columnist Mary McGrory, a Star veteran of 34 years, wrote in her column: "We're sad, but we're mad too. Now the life support system has been pulled." Her main gripe was that Time Inc. had made a commitment to spend $60 million over five years but decided to fold the paper after only 3 1/2 Time Inc. executives point out that the $60 million unfortunately ran out well ahead of schedule, and feel the company more than met its commitment. Said Munro: "We came down here with our head held high and we're leaving with our head held high. We did a hell of a job. It didn't work.''

--By Janice Castro. Reported by David S. Jackson, with other U.S. bureaus

* "The Newspaper Preservation Act of 1970 allows such arrangements when a paper in a competitive market is in danger of failing.

With reporting by David S. Jackson

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