Paper-and-Ink Insurgency Hits Detroit

DOWN Detroit's potholed East Jefferson Avenue, past a gantlet of gritty motels and boarded up storefronts, journalists gathered in a windowless brick building have hatched a paper-and-ink insurgency against the nation's two biggest newspaper companies.

The dozens of striking newspaper workers have launched The Detroit Sunday Journal, a weekly tabloid aimed at seizing advertiser dollars and clinching a six-month walkout at The Detroit Free Press and The Detroit News.

The 75-cent Journal hits newsstands each week with an underlying message for US cities beyond Detroit. The color tabloid testifies to the internal strife roiling many newspapers as management across much of the troubled industry seeks to cut costs and shore up sagging profit margins. It also symbolizes the bitter fight for control of newsrooms at many American newspapers.

The reporters say they have struck in part to prevent executives from pursuing higher profit at the expense of their newspapers' overriding duty to serve the public interest. Reporters characterize the new, slim tabloid as capturing the ethical high ground against the News, owned by Gannett Company, and the Free Press, owned by Knight-Ridder Inc.

''Newspapers are not cash cows but a conscience for their communities,'' says Robin Mather, the Journal's managing editor. ''Both Gannett and Knight-Ridder have no intent of taking on that responsibility.''

But managers at the Detroit Newspaper Agency, a joint venture between Gannett and Knight-Ridder, say the strike is over business, not ethics. The newspapers have resisted the contract demands of six striking unions to promote efficiency and to fend off the potentially lethal challenge from rival media vying for advertising and public attention.

''The unions want the continuation of a lot of featherbedding and of a lot of jobs that were just not necessary as a result of a lot of technology,'' says Tim Kelleher, senior vice president of labor relations at the newspaper agency.

Arguments can be made on both sides in light of a bitter mix of industry trends: the gradual restructuring of newspapers from private to corporate ownership and the challenge to profit margins from spiraling production costs and competing electronic and broadcast media.

Cost-cutting efforts

For decades, circulation at major newspapers has steadily declined. Readers - and advertisers - have increasingly turned to radio, television, and, more recently, computers. Compounding problems, the cost of newsprint has ballooned about 65 percent in the past two years.

In response, many major newspapers have severely cut costs. Although impressing Wall Street with muscular balance sheets, the efforts at austerity have raised concerns among journalists and some industry analysts that management has subordinated the needs of the community to those of shareholders.

''Newspapers are edited more and more for readers who are consumers and less for readers who are citizens,'' says Thomas Leonard, associate dean of journalism at the University of California, Berkeley. They have grown more responsive ''to market pressures as opposed to a sense of civic responsibility,'' says Mr. Leonard, author of ''News for All: America's Coming of Age with the Press.''

Still, the nation's press archives are littered with newspapers pulled down by disregard for the bottom line. The Baltimore Evening Sun, The Houston Post, and New York Newsday all have failed in the past several months. New York Newsday dramatized how good journalism does not necessarily mean good business: In a decade of bagging Pulitzer Prizes, it lost $100 million.

Under a joint operating agreement set up in 1989, Gannett and Knight-Ridder intended to address the challenge of printing profitable, high-quality journalism despite a continuous erosion in readership.

The News and the Free Press merged business operations while maintaining separate newsrooms. The agreement was intended to end several years of losses stemming from one of the nation's bitterest newspaper rivalries.

The joint venture, however, fell far short of expectations. Advertisers balked when the newspapers immediately doubled rates. Readers spurned the combined Sunday edition, an awkward child of the hard-nosed News and the breezy Free Press. The newspapers did not turn a profit until 1994.

Then early last year, with contracts up for renewal, management sought to streamline the unwieldy, union-controlled distribution system through job cuts and restructuring. It also required that reporters be classified as professionals, thereby making them ineligible for overtime and subject to merit pay increases rather than blanket pay hikes. On July 13, 2,500 employees walked out, and there is no sign that the two sides can find enough common ground to resume negotiations.

The strike has riled a deep pro-union sentiment in a city sometimes called the capital for US labor, bringing heavy losses for both sides. Dozens of advertisers have boycotted the newspapers, and ad lineage has fallen at least 20 percent. Circulation has slumped 25 percent. Total losses could exceed $100 million, Mr. Kelleher says.

Meanwhile, the unions have failed to halt the presses. The newspapers have continued running by deploying managers, hiring 1,400 replacement workers and, most disturbing for the unions, wooing some 600 employees away from the picket lines.

Publishing and picketing

The Journal appears to be a fillip for the strikers. Launched Nov. 19 with a $500,000 grant from a group of unions, the tabloid logs gross revenues of about $50,000 per issue from circulation and advertising. With a press run of 300,000, it is expected to reach a break-even point within the next few months by grossing revenues of $100,000 per issue, says Mike McBride, advertising director.

The real payoff is the opportunity after months of shouting on the picket lines to re-create the creativity, sense of shared mission, and rollicking irreverence in a newsroom, say the strikers, who produce the Journal without pay.

''The people who bring to their jobs a sense of conviction and love for their craft finally had an outlet to do again the thing that makes them tick,'' Ms. Mather says.