Idaho Falls Paper Drops AP -- Blames New Rates
By Joe Strupp
Published: August 18, 2008 10:10 AM ET

NEW YORK The Post Register of Idaho Falls, Idaho -- one of the newspapers that initially defended the Associated Press’ new controversial rate structure -- has given notice that it will drop the news service in two years in protest of the arrangement.

In a letter sent Friday to AP President Tom Curley, Post Register Publisher Roger Plothow informed the news cooperative of the decision, stating, “Given the AP’s historical inflexibility (particularly when it comes to small, independent newspapers), I fear the implications of what I’m about to write, but I can’t think of another option. I wish to give notice of our intent to cancel our AP contract effective August 15, 2010.”

He also states, “I’ll put my cards on the table -- I’m not sure how we’re going to pull this off. While the AP’s value to us has been severely diminished over the years, it still does provide a handful of services that we haven’t been able to find elsewhere -- yet. I’m betting, however, that it’s only a matter of time. More likely, we’ll use that time to become essentially 100 percent local, which is probably where we’re headed eventually anyway.”

Under AP rules, newspaper members must give two-years' notice before they can withdraw from the news cooperative, a policy that many editors have long opposed. But the latest opposition has followed the new AP fee structure system that was announced last year and takes effect in early 2009.

"The notice of cancellation gives Roger Plothow the option of dropping AP service in two years, as he notes," said Ellen Hale, the AP's
vice president and director of corporate communications, when asked by E&P to respond. "We will be working hard during that time to convince him of the value of remaining an AP member."

Under current Associated Press policy, each newspaper buys a package of general news created by AP based on that paper's location and circulation. The package usually includes breaking news, sports, business, and other national, international, and regional news relevant to the client's market, including its state AP wire.

Under the new structure, AP member newspapers will receive all breaking news worldwide (including items from other state wires), as well as breaking sports, business, and entertainment stories. In addition, a package of premium content — made up of five types of non-breaking stories including sports, entertainment, business, lifestyle and analysis — will be available at an additional cost.

When the new structure was announced in 2007, AP promised a combined savings of $5.6 million across newspaper member budgets, which increased to $14 million —and, finally, $21 million just days before the April annual AP meeting.

AP officials said member newspapers would begin to find out in July what their exact fees would be for 2009, which prompted the Plothow decision and could result in other newspapers cutting their service before the end of the year.

Numerous editors have opposed the revised rate structure, claiming it does not cut costs enough and is still not flexible enough for member newspapers.

When the rate structure was first announced, Plothow was one of those who initially accepted the proposal, telling E&P in February that "While I don’t agree with every decision the AP has made over the past few years, the decision to adopt this new fee structure is a very positive move and a good first step.” But, he also added at that time, "much more needs to be done, particularly in the way the AP brings its membership into its decision-making process."

In his letter sent last week, Plothow noted, “At long last, our cooperative has released its new fee plan. Under this structure, which I don’t pretend to begin to understand, the Post Register’s 2009 rate will be the same as for 2008, if we do not choose the ‘AP Complete’ package.

“We’re glad not to get a rate increase, and we appreciate all the time and effort that undoubtedly went into creating the new plan. However, it misses the point. When you were gracious enough to visit Idaho shortly after you were named the Associated Press’ president, you and I spoke briefly about the need for the association to adopt a ‘cafeteria’ approach for its members, allowing us to pay for what we use. This new plan isn’t it. I’ll repeat now what I said then: We want to receive about a quarter of what we now get from the AP and pay about half of our current fee. A quarter of the product for half the price seems fair and doable. (We’ve made the same offer to our subscribers and some have taken us up on a Sunday-only or a Wednesday-Friday-Sunday package.)”

Plothow also called his $114,000 assessment for 2009 “the worst value for anything we purchase, since we use so little of what we’re paying for.”

Plothow’s entire letter is posted below.

****************************

Tom Curley
President
The Associated Press
All members of the Board of Directors
Select member newspaper publishers

Dear Tom, et. Al.,

At long last, our cooperative has released its new fee plan. Under this structure, which I don’t pretend to begin to understand, the Post Register’s 2009 rate will be the same as for 2008, if we do not choose the “AP Complete” package.

We’re glad not to get a rate increase, and we appreciate all the time and effort that undoubtedly went into creating the new plan. However, it misses the point.

When you were gracious enough to visit Idaho shortly after you were named the Associated Press’ president, you and I spoke briefly about the need for the association to adopt a “cafeteria” approach for its members, allowing us to pay for what we use. This new plan isn’t it. I’ll repeat now what I said then: We want to receive about a quarter of what we now get from the AP and pay about half of our current fee. A quarter of the product for half the price seems fair and doable. (We’ve made the same offer to our subscribers and some have taken us up on a Sunday-only or a Wednesday-Friday-Sunday package.)

All we want is a version of the business model that cable TV came up with decades ago. Offer us a several levels of basic and premium packages, price them accordingly, and let us choose. Is that really so hard?

Given the AP’s historical inflexibility (particularly when it comes to small, independent newspapers), I fear the implications of what I’m about to write, but I can’t think of another option. I wish to give notice of our intent to cancel our AP contract effective August 15, 2010.

I’ll put my cards on the table – I’m not sure how we’re going to pull this off. While the AP’s value to us has been severely diminished over the years, it still does provide a handful of services that we haven’t been able to find elsewhere – yet. I’m betting, however, that it’s only a matter of time. More likely, we’ll use that time to become essentially 100 percent local, which is probably where we’re headed eventually anyway.

What I’m really hoping is that the AP’s management and board will come to its senses and make it possible for us to stay. But you leave us no choice except to start the clock ticking.

For now, the $114,000 assessment for 2009 represents the worst value for anything we purchase, since we use so little of what we’re paying for. I admit that I look at that money and think of all the other things we could do with it – add reporters, enhance our web site, maybe even give a raise or two to deserving under-paid employees.

Of course, my greatest fear is that 24 months from now I’ll have found no antidote to the AP and come crawling back to you, and you’ll either send me away or offer me an even worse deal. On the other hand, this might be just the motivation we need to really come up with a workable alternative.

My Post Register colleagues and I have the greatest respect for the journalists and other members of the Associated Press team. They do great work. We believe they are being let down by their board and management. Tom, with all due respect, you’ve got to do better.

Warmest regards,

Roger Plothow
Editor and Publisher, Post Register
Vice President, Post Company


Joe Strupp ([email protected]) is a senior editor at E&P.