McClatchy doesn’t plan any major changes for Knight Ridder’s online operations, but plans to save $15 million by getting rid of redundancies in the two companies’ operations, said McClatchy VP of Interactive Media Chris Hendricks in an interview with the NAA’s Rob Runett.
Hendricks has made a habit throughout his career of referring to “bodies” as cost centers. But he told Runett that the touted $15 million of savings from digital ops will come from dumping duplicated technology and software, along with volume discounts for hosting costs, content licensing, bandwidth and other related costs. He was less specific about layoffs, but those will probably come too.
Strategically, Hendricks said he plans to largely keep the status quo at Knight Ridder Digital. He voiced surprising support for the Real Cities national ad network, as well as for Classified Ventures, and the Tribune-Knight Ridder and Gannett investments in CareerBuilder and ShopLocal. He begged off commitments to smaller KR investments such as Topix and Tribe, however, pending further study.
I had predicted that McClatchy would dump RealCities, which was a pet project of Tony Ridder’s. But Hendricks doesn’t anticipate killing it off. “We’re bullish on Real Cities,” he told Runett, noting that he hopes to expand RealCities’ mission to that a general service provider, incorporating tools from McClatchy Interactive.
“We’ll focus on growing that network to more sites. Three hundred or 400 sites would be much more of an eye-catcher to the marketplace,” he said.
Hi, Peter. I’ve known Chris for many years now (McClatchy was one of the partners in the old PAFET, which is where I first got to know Chris.). I’m not sure I would characterize him as a “notorious nickel-and-dimer.”
If he sees strategic value, he invests. And I sense he takes pretty good care of the people in his division, in terms of compensation and facilities (have you seen the McClatchy Interactive offices in Raleigh?).
He is definitely a realist, however, and won’t throw good money after bad. I find him to be someone you can count on for a candid view of our industry’s future, backed by experience and real-world metrics.
I’m not writing a fan club letter here, nor do I have aspirations to work for Chris or McClatchy. That characterization just raised my eyebrows a bit based on what I know.
I’m not at all surprised that RealCities is perceived as a dusty jewel in the Knight Ridder plunder. While RealCities’ performance over the past decade has been lackluster, the idea was right on target. We are absolutely entering a time when the major portals and access providers (Google, Yahoo, AOL, Earthlink, Verizon, Cox and MSN) have begun pondering local affiliate relationships. As Internet household penetration slows down — a predictable phenomenon with any technology as it hits 80% — the pressures from Wall Street to maintain double-digit growth will force all of them to seek alluring partners. RealCities offers a very attractive option: Good local news content, free local marketing, and feet-on-the-street salespeople…packaged in a network. All McClatchy needs is a terrific marketing and salesperson, and that dusty jewel just might look like the Hope Diamond to growth-hungry portals.
Chastened by Jay Small’s comment, I have deleted a reference to Chris Hendricks as “a notorious nickel and dimer.” Earlier in his career, at Nando, Chris used to frequently brag at industry meetings about getting rid of inefficient “bodies” that didn’t result in revenues. But that was a long time ago.
In fact, Chris is a pretty gracious guy, and I know he is highly regarded throughout the online community (NAA New Media’s Lifetime award etc.)
Ah, Real Cities. I go back to the days of its invention at Knight Ridder New Media and agree with Gordon’s view of its potential and potential value in the emerging marketplaces being born. It will take more than an energetic marketer to move it to that potential, I think. Real Ciites does bring together more than 100 markets, many large ones, around one central purpose: a national ad sales network.
But a national ad sales network is looking like too little, too late, given all the challenges. The potential of Real Cities though is far greater, and requires a wider vision, coming from Gary Pruitt at the top.
The industry needs a real network to engage in the major tasks ahead of it:
—-surely, national ad sales;
—-network representation and negotiation with the major traffic players, from Google to Verizon and all in between;
—-standardizing and interoperable platforms to make the cost of publishing cheaper and to add the ability to move ad, editorial and community content around as quickly and seamlessly as the Web requires.
Real Cites could be such a network, a latter-day New Century Network (maybe a decade later than it should be, but we are now approaching 2010 rapidly). Somebody needs to take the leadership, and McClatchy’s new standing in the industry positions it to make the effort, as does its roles in Classified Ventures, Career Builder (prob), NAA and AP.
On the subject of moving to McClatchy Interactive’s platform, I hear that much of its technology is fairly dated; what do we know about how up to date/flexible it is?
On staffing, I’m hearing that few KRD employees want to make a move to Raleigh, and that McClatchy is unlikely to keep a expensive San Jose tech base, once any transition ends. McClatchy is prob hoping for Google and Yahoo recruiters to help it avoid severance costs, as the KRD empties out ahead of the 7/1 or so closing.
I evaluated some of McClatchy’s technologies when we at Scripps were looking for content management solutions.
I wouldn’t call them “dated.” The CMS platform, for one, has undergone a total reengineering and offers very good flexibility and a number of modern new features for newspaper.coms.
Again, I’m not a McClatchy shill. We ultimately went a different direction for a variety of reasons, but McClatchy’s offerings were strong enough to make our final round.