The John Henry Emails

By | Boston Daily |

Our story this month on John Henry takes a deep dive look at his decision to buy the Boston Globe and his quest to save journalism. Though Henry declined to be interviewed in person for the piece, he did agree to exchange emails. For years, the Red Sox owner has been a notorious late night emailer—“He sleeps odd hours. It is not unusual for me to get emails at one, two, three in the morning,” Globe editor Brian McGrory told me. Now I know the feeling. We corresponded between mid-January and early February, with him answering nearly all of my questions, often at length.

We’ve gathered all those responses here, presented more or less in the order he gave them (in a few cases where it made sense, we grouped follow-ups with the original question). Also, because we all sound a little different when typing with our thumbs, it’s worth pointing out that, in a few cases, Henry was replying from his iPad or smartphone. (BTW, he seems hip to the kids’ lingo.)

A number of people have mentioned to me that you’ve been reading a ton and talking to a number of people to try to get up to speed quickly on how the news industry works. Who and what have you found most interesting?

I have visited a number of people I greatly respect in the industry including Eddy Hartenstein of the L.A. Times, Katherine Weymouth of the Washington Post, Lewis Dvorkin of Forbes, Clark Gilbert of the Deseret News, Craig Tregurtha of the Times of London, Alan Rusbridger of the Guardian and the NY Times, of course.

Have any ideas particularly stuck with you?

Absolutely, these are some of the best thinkers in the business. But all of the conversations were private. They were all very generous with their time. I spent two days with the LA Times and Katherine also came up to Boston. We are all in this together. Newspapers and magazines have to adapt in ways that make sense. There is a lot riding on this.

Is there anything that you were surprised to learn? Has this process changed the way you think about the Globe?

I think very differently than I did seven months ago. I used to think this was solely a move from a legacy print business to a digital future. But it’s far more complicated than that. Print remains a very strong revenue generator for newspapers both in advertising and home subscriptions. The most surprising conversations have been with advertisers who have told me how effective their advertising in the Globe is for their businesses. That’s a message we have to get out and we will.

What are you most happy about with the Globe right now?

I feel like our management team is coming together. We will have major announcements soon. [Nine days later, on January 30, Henry named himself Publisher and hired former Hill Holliday boss Mike Sheehan as CEO.] I’ve been surprised by how talented the people of the Globe are at all levels. The pressmen are devoted to putting out hundreds of thousands of papers a day—millions of pages a day—with as much quality as possible. Truck drivers are heading out tonight into a snowstorm. 98 percent of them will be out there with 2 percent out in flu season. In winter they are our MVPs. It’s a huge team of people who love the Globe, devoted every day to getting the news reported, printed, inserted and delivered.

What opportunities do you see for improvement? What would you like to do differently?

There are quite a number of opportunities. I’m not sure newspapers in general realize the degree to which they are services. Obviously the Globe is a news service, an opinion service, a production and delivery service. We are strong content generators and provide opportunities for discussion of topics of importance in New England and beyond.

But like virtually all newspapers I don’t think we have worked nearly hard enough on customer service—improving the customer experience beyond what our core mission is. As an example it’s not enough to deliver a paper to your home before the sun comes up, that paper has to land in the right spot. We have to ensure that whether the paper is printed or digital, it is giving you, our reader, the best possible experience we can give – for morning coffee, weekend reading or on your tablet for nighttime reading.

It’s critical to step up customer services for both readers and advertisers beyond what we imagine today. I’m reminded of Larry Lucchino who is constantly asking what we can do to improve the fan experience at baseball games—before, during and after—no matter how much positive feedback we get. If newspapers are going to adapt to an increasingly competitive environment—and they have to—we cannot rest with regard to service, relevance and impact. We have to positively impact the lives of our readers.

In their paper, “Breaking News,” new Globie David Skok, along with Clayton Christensen and James Allworth, discuss “disruptive innovation” in journalism at length. Do you see opportunities for the Globe to be disruptive? Are there any aspects of what the paper does that should be disrupted themselves?

I really admire those two. I’m not sure it is necessarily up to the disrupted to be disruptive as a strategy, but virtually everything these days is subject to disruption—even Middle East oil. We’ve just seen the beginning of it probably. This goes well beyond newspapers. Mobile won’t be called that soon because there will be very little that isn’t going to be connected and disrupted. Your golf clubs, chairs, vitals, car will be seamlessly connected but I think in ways that will be the opposite of Big Brother despite the NSA.

Jeff Bezos has done an incredible job at Amazon, but you might argue that what he is spawning at Amazon Web Services is every bit as exciting and disruptive. Everyone employed by a serious newspaper knows what our journalistic mission is. But, it’s up to us to adapt in order to carry out that mission. That means we have to experiment just as every disruptor is doing.

Free is the great disruptor. How do Garmin and Rand McNally compete against a free Google Map app on your phone? An editor said to me recently, “If no one is reading us, why are we doing this?” So we don’t need to disrupt, we need to concentrate on what we do best. The digital head of the Financial Times said to me, “People pay for ringtones.” We know TV was free for decades. We can compete against free thankfully but probably not as we are today.

It will be fascinating to visit the newsrooms of the future. Hopefully we will create one within the next 3 to 5 years in Boston.

I’ve gotten the sense from talking to people that you see the Globe as both an intellectual challenge and as an opportunity—in a sense, as a lab to try to figure out how to make journalism sustainable in the future. Is that an accurate reading? If so, how do you begin to approach that challenge?

Probably so. I might call it an important challenge for all social systems on the planet. Lord Northcliffe famously said, “News is something someone somewhere doesn’t want printed. Everything else is advertising.” I might slightly modernize that to “Original news that is verified, analyzed and given proper context is more important than ever. Everything else is entertainment.”

Are there any concrete steps you intend to take now or in the immediate future to help put the Globe on sounder financial footing and help make it sustainable for the future? I know for instance, a new tech site is on the way and that there’s been a lot of discussion of creating a network of niche channels. How big a role do you see that niche approach playing? Are there any other ideas you’d like to see implemented over a more long-term period?

It is significant that we have no debt. Generally it’s been debt that has led newspapers into bankruptcy. We also have an extremely valuable 16 acres that will provide us with the ability to move into a smaller, more efficient and modern facility in the heart of the city. We believe that there is enough excess value there to fund very important investments in our long-term future, if the community supports development of the property.

George Brock wrote a significant book recently called “Out of Print.” My wife and I had a 3-hour lunch with him in London. He said, “Don’t ask your people to innovate. Tell them to experiment. Turn the Globe into a giant laboratory for journalism.” That resonated with me. Telling disrupted journalists to innovate places a heavy weight on them. That sounds to me almost like “Get a new job.”

We live in a world now with an eager audience of 2 billion connected people. George is probably correct. Experiment with your mission and how you deliver it. That’s a lighter, appropriately optimistic refrain. Reach out to your New England audience in new ways and be surprised where that leads. That will be exciting and fun.

[Follow-up:] I was re-reading what you wrote to me before about moving the Globe from Morrissey Boulevard to downtown, and I wasn’t sure whether you meant that your intention is to sell the current 16-acre site, or if it is to develop it yourself and try to make money off it that way. 

No we are not developers.

[Follow-up:] Is your intention to sell the Morrissey Boulevard property? (And has that process already begun?)

It is something we are exploring presently. It is part of what is necessarily a long-term strategy the business needs to develop with regard to the high cost of the print, production and delivery of physical newspapers as digital delivery methods continue to improve.

There is still nothing like print for delivering a premium reading experience and for advertisers. But print has to be more efficient in a highly competitive, digital age. In addition realizing the extraordinary value of a 16-acre parcel in Boston could provide a significant funding source for additional investment in the Globe‘s future.

A lot was made when you first bought the Red Sox of you being an “outsider,” not from Boston. How has your relationship with the city changed over the years, to the point where you felt compelled to make this investment—in both time and money—in one of the city’s most important civic institutions?

I wanted to be a part of finding the solution for the Globe and newspapers in general. I feel my mortality. I don’t want to waste any of the time I have left and I felt this was a cause worth fighting for. Part of what’s been so satisfying with the Red Sox all of these years was the feeling among us of a common cause. It seems like virtually everyone I’ve met thus far in journalism shares that feeling as do so many at the Globe.

Do you plan on keeping Brian McGrory as editor?

Yes.

What’s your relationship with him like?

Excellent. He knows Boston as well as anyone, is as smart as anyone, more dedicated than anyone else and puts the interests of the city at the top of every discussion.

What was the reason (or, more likely, reasons) for parting with Chris Mayer as publisher? Though, from what I’ve gathered, the move was long in the works, timing-wise, why did you pick the Monday before your chamber speech to pull him aside and make it final?

Chris remains very close to the Globe as an advisor to me. The New York Times has a certain management style I respect greatly. And Chris did a great job through difficult times at the Globe. But I have a different management style and philosophy compared to the Times or Chris. The organization needed to move in new directions that could only come from new management.

You mentioned being impressed by what Jeff Bezos has done with Amazon Web Services-have you talked at all with him about the Post? Or newspapers in general?

No.

You’ve got the opportunity now to sell advertising sponsorships across multiple platforms, and I understand the Globe has already been pitched to major brands alongside Fenway Sports Group properties. What kinds of doors does that open for the Globe from a revenue perspective, and do you see other opportunities where your relationships, or FSG’s relationships, will be an asset on the sales side of the Globe‘s business?

That’s a better question of Mike Sheehan. We are extremely fortunate that he has joined the team.

A number of people have brought up to me that you’re anxious to see the Boston.com redesign launched as soon as possible and have deeply involved yourself in the process (even suggesting at one point that the pictures on the site be made bigger). Have you been frustrated that the redesign has taken so long? Why have you identified this as a priority?

The emphasis over the past year and a half has been on BostonGlobe.com which won the best news site in the world award. We are going to have a completely separate focus going forward on Boston.com—one of the most effective local sites in the world. We are going to revitalize and re-launch a completely different website with a new format, differentiated from BostonGlobe.com’s content and a dedicated staff. The work has really just begun in earnest.

Though the redesign was obviously in the works before you bought the paper, I understand that you’ve been a strong advocate of clearly separating the Boston.com and BostonGlobe.com brands. What’s the thinking there?

Boston.com will be a free and open site that has to have costs, format and content to compete in today’s world. It’s an exciting project. A dedicated staff separate and apart from the Globe. You’re hearing a lot these days about digital-first. Boston.com will be a phone-first website. That’s where the world is these days—on your phone.

BostonGlobe.com is the Globe‘s website that will be free for casual readers but a key strategy for us is digital subscriptions. Heavy users will need subscriptions. The future of almost all serious newspapers ultimately lies in digital subscriptions. What has enabled TV networks like HBO, NESN, CNN and ESPN to become content powerhouses is the dual income stream of subscriptions and advertising.

I also understand you’ve been a strong advocate for the impending switch of BostonGlobe.com to a metered model, a la the New York Times. Why?

The meter is used by most papers now—we are late to that party. It’s the least confusing format that allows the world access to your content while still requiring subscriptions from regular users. Newspapers made a mistake TV didn’t make in giving their content away. TV did that for 30 years then realized the power of dual income streams. Newspapers have finally recognized this.

I’ve met with a lot of the best digital startups and while they are not having trouble raising money, they’re finding free is a real struggle. It’s just a matter of time before most of them begin to move in a similar direction. That’s heresy now, but will become the norm unless your content is weak.

We’ll see pricing as more of a reflection of the value of your content as time goes on.

People from the Boston.com staff have mentioned to me that you’ve popped into their war room in the third floor conference room a few different times, including just before Christmas on the morning of December 24. Were these more general visits just to meet staff? Or were you checking up on progress and trying to understand how the redesign process works?

Neither. There’s a lot to be done. It’s a highly complex business and there’s a lot to learn so you might find me anywhere there on any particular day.

Are there any other initiatives that you’ve identified as top priorities or really sunk your teeth into so far?

Yes (no comment)

What are your plans for Globe TV? How advanced is that initiative?

It’s not advanced at all. Our current priorities have just been set and this one is currently 7th. We will get to it. We know what it will take. It’s a natural fit for the Globe. We are the largest content generator in New England.

Brian McGrory told me that it’s his impression that the Globe, right now, is your top priority. Others told me they feel you’re not fully focused on the Globe because of your commitments to the Red Sox, Liverpool, and the rest of FSG. Where does the Globe rank on your priority list, and do you see your involvement continuing at this level as time goes on? Increasing? Decreasing?

Filling out the management team at the Globe is high priority. When the Red Sox had a terrible year some people wrote that I was too focused on Liverpool. But the truth was that I hadn’t been there in a year.

The fact is I don’t operate the Red Sox or any of the individual companies we own. For example, with the Sox Larry is the CEO, Ben is the GM and John is the manager. They all have large staffs. I’m there, as is Tom, to ensure we have the proper resources to win and to make strategic, long-term decisions – not to pick pitchers, lineups or sell sponsorships.

I moved away from having clients in the investment business so I actually have more time than I used to. Fenway Sports Group is a 7-day-a-week job, but not 24 hours. Jack Roush runs Roush Fenway Racing, Ian Ayre, Mike Gordon, Billy Hogan and Brendan Rodgers run Liverpool, Sam Kennedy runs Fenway Sports Management sponsorship everywhere except Liverpool.

So I have time to devote to the Globe and I’m greatly enjoying every day I’m there. I try to be there as often as my schedule permits. In 2014 I’ll work in my offices at Fenway and at the Globe.

[Follow-up:] How much of the management structure you’re putting together now for the Globe is based on your previous experience with the Red Sox, Liverpool, and FSG, and how much is based on the specific needs of the Globe?

Will be determined by the specific needs of the Globe.

BTW I’m finding my role thus far to be very rewarding.

How did the idea of bringing on John Allen and starting a standalone Catholic news site start? Not that this was necessarily the original genesis of the idea, but I was talking to Mike Barnicle and he recalled chatting with you at a game this past fall about how much religion interested you. Mike also said that you asked him if he was familiar with John Allen and if he had his email address. Is that how you recall that anecdote as well? (And if so, do you remember which game this was at? Mike thought it might have been during the Tigers series, but wasn’t sure.)

I remember because it was my birthday—Sep 13th and we finally first spoke on the 19th.

Mike knows everyone worth knowing. I kept asking Bostonians, “Who is the best Catholic journalist in the world?” The answer unanimously was John Allen. So I called him and outlined some ideas I had about what we could do together. Then I called Brian and he was just as excited as John was. So we all met in Boston the day after the World Series ended to talk about what we might do that would be new and exciting.

In your Chamber of Commerce speech, I noticed the word “rightsizing” tucked into the middle. From talking to folks at the paper, though, including Brian McGrory, it seems pretty clear that you intend to invest in the Globe. So, just to be clear, will there be any cutting at the Globe? Or do you foresee additional spending?

As I traveled and met with people around the world about the industry I began to hear the word “right-sizing.” It really isn’t semantics. Downsizing is cutting costs. Rightsizing works both ways. Generally startups rightsize by growing staff to fill their needs. In today’s world newspapers don’t need to be “everything to everyone.” Jeff Jarvis would say you need to be the best in the world at what you do and link to the rest. I think that’s right. So you need to right-size all of your departments. Some need to grow and some need to shrink. There are a number of factors that will dictate that but all of them are really tied to relevance and mission in today’s world. For instance we probably need 5 times the developers we currently have.

[Follow-up:] What other departments at the Globe do you see as needing to grow and which others you see as needing to shrink?

Except with regard to developers increasing in numbers, it’s too early to say. Have to get the management team fully in place first.

How much of an investment, moneywise, do you expect to make in the standalone Catholic site? Or spend on a potential Globe TV initiative?

Don’t you do any investigative reporting? (kidding)

Is revenue projected to be down this year? How long do you think it will be before the projections will be positive?

Yes, newspapers are still in a secular decline and it could continue for a long time. I think everyone in the business expects revenues to decline. We do. But this is exactly why we have taken up the challenge I’ve been speaking about. Our first goal in bringing about sustainability is stabilizing revenues and then beginning to grow them.

Is the Globe profitable?

It’s somewhere near breakeven, but that’s not a good thing when revenues are declining.

Are there any minority investors in the Globe? Do you plan to bring any on?

I was hopeful of having financial partners, but I eventually decided the NESN bid wasn’t appropriate and recommended we drop the bid. A NESN/Globe partnership would have made a lot of sense from a business point of view, but some FSG partners opposed it for public relations concerns. And it’s hard to justify purchasing a business with falling revenues unless you have a solid plan for turning it around. As I mentioned earlier no one has found a magic bullet for newspapers or magazines yet.

Then I thought I should lead a philanthropic effort and I found a lot of support among FSG and community partners. Everyone I asked offered to get involved philanthropically. It was really the people of the Globe who objected to the charitable route and I eventually agreed with their point of view. Newspapers should be able to stand on their own. I came to see the importance of getting involved was in achieving financial sustainability for the long-term.

I then found willing partners inside and outside FSG who cared very much about the future of the Globe, but eventually I thought that I would be significantly freer to make important, necessary decisions without subjecting investors to the consequences of my actions. Also I felt it was an advantage for the Globe not to have a number of investors whose interests could be affected by positions the Globe took in the newsroom and in the editorial pages.

My only conflict probably resides in just one of four major sports in the sports pages. I felt that as long as I stayed out of that area, I could provide a strong buffer across the board for ensuring we are always acting in the best interests of the community.

When I got to chat briefly with Linda [Pizzuti, Henry’s wife] after the Chamber breakfast, she described her role at the paper as “evolving.” Is there any greater sense of what exactly her role will be yet?

Linda is fully engaged working on important issues for the Boston Globe. She is leading initiatives to activate our subscriber base connecting the Globe to the community. She is heading up the Boston Globe Foundation. And she serves on a number of internal committees that deal with real estate, circulation, social media and other business issues.

She was the driving force behind our recently launched Globe GRANT program, which gave our subscribers vouchers they are assigning to non-profit organizations for advertising space in the Boston Globe. This program has been very warmly received by charitable organizations and subscribers.

And finally, on a lighter note, one of the pressmen relayed to me that you reserved your parking spaces in front of the building only after, on the first night you came to visit the press room, the garage attendant didn’t recognize you and wouldn’t let you in. Is that what actually happened?

No, I parked there the first day (maybe the second day). Part of the story is true. One security person didn’t know me and I still didn’t own the place so it was absolutely proper for him to escort me in and find out if I really was meeting with pressmen. It was late at night. Some guy walking in off the street heading for the presses? It’s an exciting place when the presses are running.

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