Media veteran Ross Levinsohn's latest challenge: sparking growth at the L.A. Times
Ross Levinsohn is used to tough jobs. He tried to salvage a business out of social media site Myspace, and managed Yahoo during a tumultuous period when the Internet company was reeling from a management scandal and struggling to find its way.
But this week, the 54-year-old digital media executive took on what could be his most difficult assignment yet: figuring out how to generate more revenue from the journalism produced by the 135-year-old Los Angeles Times at a time when the news industry is grappling with sweeping shifts in consumer behavior and a proliferation of online outlets.
“How do we bring that [journalism] to the world in a more aggressive and speedy manner?” Levinsohn said of his mission in an interview after he was named The Times’ publisher and chief executive Monday. “That doesn’t happen by accident. You really have to roll up your sleeves and have a strategy and the right people.”
The contours of that strategy, Levinsohn said, entail beefing up the news organization’s politics, entertainment, culture, sports and investigative reporting to capitalize on The Times’ talent pool and brand. His bosses at Chicago-based parent company Tronc have tasked him with making The Times more of a global player, particularly in Asia and Latin America. He also vowed to provide more resources to a newspaper that, like many of its peers, has sustained years of budget cuts.
Tronc executives say the L.A. Times is the jewel in the company’s crown and reviving it is of critical importance.
“What we need right now is someone with global vision and the ability to execute on that,” Tronc Chief Executive Justin C. Dearborn said. “We need to start growing the business. That will start first in digital.”
Tronc shares rose 5% Tuesday, closing at $14.09. That's still down from October 2016, when Gannett takeover talks drove the stock price above $17 a share.
Analysts said that Levinsohn faces daunting challenges gripping the news industry. He’s also taking over The Times after management turmoil and more than a decade of ownership changes and a revolving door at the publisher’s office. Levinsohn is the 17th publisher of The Times, and the eighth since 2000.
He plunged into his new job Tuesday, appearing on business network CNBC to make the case that The Times and Tronc have been undervalued by investors and advertisers. He had lunch with senior editors to meet his new team and learn more about projects underway.
“Ross is a good guy. He’s smart and he’s been doing digital media for a long time,” said Larry Kramer, former publisher of Times rival USA Today. “The only hole in his resume is that he doesn’t have newspaper experience — but the future of the organization is digital. It’s still the content that makes the L.A. Times the L.A. Times.”
Newspaper advertising revenue peaked in 2006 with an estimated $49.3 billion spent in the U.S., according to the Pew Research Center. Last year, the industry registered $18.3 billion in ad sales. Increasingly, consumers are reading the headlines and articles on their mobile phones. And while the New York Times, Washington Post and Wall Street Journal have made gains in converting online readers into paying subscribers, the L.A. Times has lagged.
He was president of Fox Interactive Media, where he oversaw projects including MySpace and Fox Sports. (Aug. 21, 2017)
“When this new ownership group [Tronc] took over, they made a lot of noise about how they were going to transform the way that content would be delivered — but we haven’t seen that materialize,” said longtime publishing analyst Douglas M. Arthur of Huber Research Partners. “And on the digital advertising side, it has gotten worse.”
Online ad revenue, on which Tronc and other media companies have pinned their hopes, hasn't increased at Tronc since the second quarter of 2016. Online ad revenue in the second quarter fell to $47.5 million, down nearly 9% from the same period a year earlier, according to Tronc earnings reports.
Online subscriptions across Tronc have grown, but not as much as at other companies. The number of online-only subscribers stood at 220,000 in the second quarter — about half of them from the Los Angeles Times — up nearly 90% from a year earlier.
The results prompted Tronc to shake up management Monday, dismissing three corporate executives as well as the publisher-editor of the Los Angeles Times, Davan Maharaj, and three other top Times editors.
Tronc business executives acknowledge they have made missteps trying to balance the amount of advertising on the company’s online sites. Internet behemoth Google this summer warned the L.A. Times that it was violating the Better Ads Standards by having too much advertising clutter on its digital sites.
“In the end, even advertisers will rebel against all the ad clutter,” Kramer said. “Advertisers don’t want to be in a page with seven other advertisers.”
Levinsohn acknowledged the problem, saying, “we have to make our consumer experience better.”
Though he has no prior experience working in newspapers, Levinsohn has expressed a deep reverence for the medium and the mission of journalists even as they struggle with digital disruption.
"In my adult lifetime, there has never been a more important time for journalism, for facts, for reporting,” he said. "It used to be the power of the pen, but now it is the power of the platform. I’m going to support you and get you more resources.”
Levinsohn negotiated a three-year employment agreement with Tronc that runs through Aug. 20, 2020, according to a copy of the contract filed Wednesday with the U.S. Securities and Exchange Commission. He will be paid about $1 million a year.
He also will be eligible for incentive bonuses. He’s eligible to receive up to 10% of the gross dollars that Tronc receives for syndication of the company’s content outside the U.S. and for the licensing and distribution of Times content — giving him an incentive to deliver on the company’s global ambition.
He grew up in New Jersey and was big into sports. He played high school baseball (pitcher and shortstop), soccer and football.
After graduating from American University in Washington, D.C., he worked at an advertising agency, a marketing firm and later HBO. By the mid-1990s he was working in digital media, eventually with search engine Alta Vista and the online site CBS Sportsline.
His big break came when he was at Fox, where he impressed media mogul Rupert Murdoch. After Murdoch spent $580 million to buy Myspace in 2005, he tapped Levinsohn to manage the young team that built the music and social networking site.
But Facebook eclipsed Myspace, which Fox sold for $35 million in 2011. Two executives who worked with Levinsohn at Fox said that Levinsohn does not deserve blame for Myspace’s collapse. Fox bought the site after its U.S. traffic had already peaked and then wasted millions of dollars trying to expand the service overseas.
“I learned a lot about what not to do,” Levinsohn said of his experiences at Myspace.
He also got a valuable education from his nearly two years at Yahoo. Levinsohn, who joined Yahoo in 2010, served as interim CEO for about three months in 2012 after the previous CEO, Scott Thompson, was ousted over allegations of resume padding. Levinsohn was a leading contender to become the permanent CEO, but lost the job to Marissa Mayer, whose hiring was considered a coup for Yahoo at that time.
More recently, Levinsohn co-founded a boutique advisory firm. He has served on several boards and invested in media, advertising and tech start-ups. Levinsohn is an investor in virtual-reality content producer Wevr and video news producer Attn. (Levinsohn’s contract requires him to work exclusively for Tronc.)
Such interests could suggest that he'll try to push The Times to become more video-focused, though Gabe Kahn, a professor at the USC Annenberg School for Communication and Journalism, said that's been a goal for years.
"The Times has tried to make a stab at video, but it hasn't gained any traction," Kahn said. "A lot of these companies have been involved in creating new digital products for consumers, and that development process and to-market process is important."
The Times’ future comes down to picking its shots and the quality of its journalism, analysts said.
“I don’t think it is too late,” Levinsohn said. “We should benefit from doing great work by distributing it to people wherever they are.”
Kramer, the former USA Today publisher, said Levinsohn should be up for the task.
“If you can manage the transition to digital, at the end there is a pot of gold,” Kramer said. “The biggest decisions that he is going to face are figuring out the priorities. How do you make money at the old game, while learning how to spend money in the new.”
Staff writer James Rufus Koren contributed to this report.
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UPDATES:
1 p.m.: This article was updated to include details of Levinsohn’s employment contract.
The original article was published at 6 a.m.
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