Who’s Watching Business?

With the events of July 6, 2006, now five years behind us, this month marks the anniversary of the most dramatic change in the South Coast’s news media paradigm since the beginning of the 20th century. It was on that date in 2006 that five of the Santa Barbara News-Press‘s top editors — including the business editor — quit in a dispute with owner Wendy McCaw, who had bought the paper in 2000.

The walkout was just the start of a series of events that would rock the journalism world in Santa Barbara. But from the perspective of a business writer and editor with more than three decades of experience in the area, the News-Press meltdown also spelled the beginning of the end for regional business coverage. And that, paired with the ongoing recession, has been bad for the business community, which is still struggling to recover.

It’s hard to imagine what would have happened had the News-Press not melted down because the paper would still have suffered like every other publication across the country because of a serious decline in advertising revenue and subscriptions. But the events of 2006 quickly proved beneficial for the daily paper’s competitors — namely The Santa Barbara Independent, the Daily Sound, and the Pacific Coast Business Times — and even spawned some new journalism growth, particularly in the Web site Noozhawk.com.

Last week, I emailed the editors and publishers at these other publications to inquire about their opinions on the state of South Coast business coverage, but as of Wednesday, they had not responded. Having personally worked for all of these publications over the past two years, I happen to have my own unique insight into their day-to-day operations and what they might mean for future financial coverage.

According to its own reporting, the Daily Sound owes tens of thousands of dollars to at least one creditor, and they only pay one full-time newsman. Despite this, the Sound began a new publication called the Montecito Messenger last month, with the help of documentary film maker Sam Tyler (whose Citizen McCaw profiled the News-Press controversy) and Montecito editor Judy Foreman.

Noozhawk.com‘s revenue appears to be rising, but the online experiment depends on contributions from anyone who will pitch in, whether it’s admiring individuals or organizations like the Santa Barbara Foundation. The Business Times rarely features paid ads on its Web site or in print and, after more than 10 years, has only enlisted about 2,000 subscribers. Although The Independent continues to print 40,000 copies per week — and enlisted former News-Press staffers Starshine Roshell, John Zant, Barney Brantingham, and Jerry Roberts as columnists — its owners are currently fighting for control of the publication in court, and it continues to face the rising costs and diminished advertising revenue that are affecting papers nationwide.

My knowledge of the News-Press dates back to 1988 when it was owned by the New York Times and I was hired as a business writer. Eventually, I was promoted to assistant city editor just before it became evident that the Times planned to sell the paper. It was then I first worked with Noozhawk founder and publisher Bill Macfadyen, who also started the now-defunct but award-winning South Coast Beacon. I left the N-P in early 1993.

Between 1993 and 2007, I worked as a reporter and city/business/copy editor for various news agencies, including United Press International, the San Gabriel Valley News Group, Riverside Press-Enterprise, Salinas Californian, and McClatchy’s Vida en el Valle before returning to Santa Barbara.

In 2007, I became the managing editor of the Pacific Coast Business Times, but was laid off 16 months later when the recession made paying my salary too costly for the South Coast’s only business journal. After that, I worked as a copy editor and writer for the Daily Sound, and then tried to start a daily business section at Noozhawk.com, but the company would not commit the resources necessary to make that project succeed.

During my reporting over the past five years, South Coast business owners have often complained to me that they suffer from lack of financial coverage because no publication even attempts to track most local commerce on a daily or weekly basis in a specific section. The News-Press hasn’t had a business editor in three years, for instance, and the Business Times also covers Ventura and San Luis Obispo counties, which means that Santa Barbara news isn’t always a top priority.

Complicating matters more, in my opinion, is that the vast majority of South Coast business coverage is conducted by writers with little or no previous financial experience, in large part because younger writers tend to be cheaper than more experienced reporters such as myself. As such, there is a lack of institutional knowledge about the South Coast’s commercial community. No matter how talented a young journalist may be, it’s hard to write about what is happening today with little understanding of how things got to be that way.

And the situation may not change any time soon, as many of the correspondents relied upon in Santa Barbara for business coverage aren’t actually paid staff members. Instead, many are part-time, often underpaid freelance writers who usually have another job to make ends meet. For instance, the full-time writing staff at today’s News-Press is a fraction of what it was in 1990 or even 2005. It has one designated business writer, while in 1990 it had three.

The biggest newsroom in town appears to be The Independent, according to senior editor Matt Kettmann, who said that editorial staff is somewhere around 25 people, with about six editors/reporters paying attention to “hard” news. But The Independent‘s business coverage has waxed and waned over the years, and they do not have a designated business reporter or editor (except for the new South Coast Biz Blog).

The area’s television stations are not immune to the decline in advertising and sinking revenues, and that’s not good for other businesses either. According to sources in the business community, it’s hard to find anyone in charge at KEYT because of staff cutbacks. KSBY’s former news director, Dave Shermer, quit last month and said it was because he could make more money with his own business rather than stay in broadcasting as he had for almost two decades. None of the local TV stations has a designated business reporter or editor.

An interesting twist is that former KEYT news director Don Katich was hired by the News-Press a couple years ago as “director of news operations.” While he’s thought of fondly by his former colleagues, they also say that Katich doesn’t have any particular experience in financial journalism. Though he didn’t respond to my requests for comment, Katich did wish me “good luck” on this blog earlier this week.

Altogether, most observers see financial journalism as in a dismal state not just on the South Coast, but across the nation. However, while the model could change and be adaptable in other places, it appears the South Coast’s journalistic pool is quite shallow for now.

The South Coast Biz Blog is a roundup of the latest business news in the Santa Barbara area and is written by Ray Estrada, who has covered business in the region for numerous publications over the past couple decades. See more at independent.com/biz and wordpress.com/southcoastbizblog.