Vol XIl, Issue 26 TNG/CWA Local 31041 May 14, 2001


:CueCat: Sent to Corporate Doghouse?

Despite months of hype and a reported investment of millions of dollars, Belo Corp. officials had nothing to say to stockholders about its :CueCat.

Not one word.

Not a picture.

Not a slide.

Not even an aside.

A stockholder, who'd seen his company invest in Digital:Convergence Corp. of Dallas, might wonder how it's purring along in cyberspace.

Belo spent months of staff training and related work in Providence, Dallas and other places to send the :CueCat hunting for readers and advertisers, then witnessed thumbs-down reviews from the new technology community.

But there wasn't so much of a whisper about all of this at the Belo May 9 meeting.

Cat got their tongue?

Just hours after its annual stockholders' meeting ended May 9 in Dallas, Belo Corp. placed a video and audio account of the meeting on its corporate website, a so-called "webcast" of excerpts of the 1½ hour session.

Hear the WEBCAST
To listen to the May 9 Belo shareholders meeting webcast, go to Belo's news release page; click on Recent presentations. Scroll down to "Annual Meeting of Shareholders - May 9, 2001 - Please click on the links below to view the major presentations at the meeting."

But if far-away shareholders hoped to watch the proceedings for themselves, they were in for a disappointment.

Belo censors cut out key presentations at the meeting, including those by two officials of the Providence Newspaper Guild, who told stockholders about troubled labor negotiations and their possible negative financial impact at the Belo-owned Providence Journal in Rhode Island.

In fact, the editing of the webcast made it seem like Robert W. Decherd, Belo's chairman, had sought discussion and questions from shareholders, but none were offered, when in fact Brian Jones and Kerry Kohring addressed shareholders at three different points in the meeting.

This censorship may not come as a surprise to the 500 men and women who belong to the Guild back in Providence: they have grown used to having their own paper largely ignoring news of the contract dispute and its possible economic harm to the newspaper.

But censorship is serious stuff, and this is no exception:

· First, the webcast scissoring is an example of a major communications company cooking the books, in terms of its reporting on its own affairs, undermining public confidence in the media's ability to give the news impartially.

· Secondly, it gives stockholders of the company a misleading account of what had gone on in Dallas, denying them the Guild's view of the financial strain caused by labor troubles at a major Belo property, as well as management's rebuttal.

And it was not as if this webcast was an afterthought.

The news release Belo issued about the meeting had trumpeted the video in the lead paragraph:


When the company, in a surprise move two years ago, transferred Philip Terzian, the former chief editorial writer and now Washington columnist, from a non-union management slot to the Guild bargaining unit, the union believed he should have been paid the so-called "Washington differential.''

That's the supplement paid Washington employees for having to cope with high prices in the capital.

When the Guild examined Terzian's pay records, it could find no indication that he was getting the $150 weekly payments. When the Guild raised the issue, Journal officials refused to pay "because we are already paying him enough."

Arbitrator Arnold M. Zack ruled that "location differentials" payments had been included under the merit pay category in previous instances, and that he believed that Terzian's total salary included merit pay and the location pay, as the company had argued.

Zack noted the company gave Terzian a raise before his transfer into the Guild bargaining unit to compensate him for having to shoulder union dues:
"The evidence shows that this prior compensation as an exempt employee … was increased …, prior to his transfer to the News bargaining unit. This was apparently intended to reimburse him for the 1.8 % he would be expected to pay as Union dues."

"A replay of major presentations at the meeting will be available online for two weeks, beginning Wednesday May 9 at 6:00 p.m. CDT on the News Releases page of the Company's Web site at http://www.belo.com.''

It's possible that the Belo editors didn't consider the Guild's presentation "major.''

But what Kohring, a copy editor at the Journal, and Jones, a general assignment reporter there, were telling shareholders sounded serious.

"We would like to urge the new board to address what we see as the threat to the value to our shares and those of everyone else in this room posed by the actions of The Providence Journal Co.," Kohring said.

"Circulation is continuing to decline, and yet the actions of Journal management have resulted in the threat of a consumer boycott of circulation and advertising," Kohring said. He noted that the federal government has charged the paper with 30 counts of labor law violation, and that during the troubled negotiations, 55 persons have quit the paper.

Jones said: "I'm the canary in the mine. There's something going wrong. I'm part of that; I'm part of sort of a train wreck in Providence that is threatening the viability of our paper. We have a civil war going on at that paper, when we need to be pulling together, going in a different direction."

Decherd took the comments seriously enough to make a detailed response: He said he had confidence in Journal publisher Howard G. Sutton; that Belo likewise was confident that the unfair labor practice charges "will be mostly decided in our favor;" that the exodus of workers was normal attrition; and that Belo had had a "spectacular experience'' with The Journal.

But web-watchers got to see neither the union's nor management's version of that dispute. To the contrary, viewers were led to believe there hadn't been dissent.

The most misleading cut came during the election of three company directors, the only scheduled "business" of the meeting, which otherwise was taken up by a self-congratulatory account of the past year and a rosy forecast for the future.

"If any shareholder wishes to speak on the agenda item, you should indicate as such to one of the ushers now, and he will provide you a microphone," Decherd said, after announcing the nominees, including former Journal publisher Stephen Hamblett.

He asked any speakers to identify themselves, their number of shares and speak for 5 minutes or less.

"Is there any discussion on the agenda item?" Decherd said. "If not, then I declare that the polls are now open for voting on the agenda item."

But there were speakers. Jones said that Hamblett, seeking reelection as a director, and others on the board had not properly overseen the labor negotiations in Providence. And there was another stockholder, a corporate gadfly, who complained that such elections of directors are not democratic.

At the end of the meeting, Decherd asked if any shareholders had any other concerns, and Kohring and Jones gave more details about the Providence troubles, and the gadfly complained about management stock options. Decherd responded to those comments, too.

The only hint of clouds in the sunny corporate sky was to be found in the next day's Belo's Dallas Morning News, which included two paragraphs noting that Jones and Kohring had described the labor troubles, and Decherd had said that they were local matters for competent Providence managers to handle.

The Journal, meanwhile, maintained its Guild blackout. It reported in a news-briefs item on the business section front two days later that Hamblett and two other directors had been reelected.

But there was no mention of two Rhode Islanders who had traveled 1,700 miles to Dallas to vote against the directors and to raise concerns about The Journal.

Copyright © 2000 The Providence Newspaper Guild
TNG/CWA Local 31041
270 Westmister St., Providence, Rhode Island 02903
401-421-9466 | Fax: 401-421-9495