Newspaper Production Enters Colorful, Outsourced Era

Good model. Bad timing.

A new approach to producing newspapers in the United States had a colorful beginning this week when the production of all copies of the San Francisco Chronicle were outsourced to a new plant built and run by Transcontinental Inc.

The Chronicle’s own 50-year-old flexographic presses were idled, along with about 200 unionized employees, after production of Sunday’s issue. Filling the void is a $200-million-plus Transcontinental plant in Fremont with three heatset/coldset offset presses, new inserting equipment -- and non-union employees.

As Dead Tree Edition has previously explained, the operation breaks new ground in the U.S. on at least three fronts: 1) The presses can run in either coldset or heatset modes, making them able to print on anything from newsprint to coated paper. Not only do they add color and boost quality for the Chronicle, they are also suited to doing general commercial printing. 2) The outsourcing of a major newspaper’s production to a commercial printer. U.S. dailies typically control their means of production. 3) The plant was designed with the ability to produce multiple newspapers, though no other clients have been announced.

The Hearst-owned Chronicle says the new operation will yield substantial savings without Hearst having to invest in new equipment. It’s not clear to what extent the savings come from the inherently greater efficiency of the new presses, narrowing the paper from six columns to five, or the switch to non-union labor. (One newspaper industry veteran tells me that non-union newspapers tend to pay their press operators as well as similar-sized union papers. But their compensation costs for the pressroom are lower because they don't have contract-imposed staffing requirements and assign more of the less skilled work to lower-paid employees.)

Don’t expect Transcontinental to be replicating its innovative San Francisco model in other metro areas any time soon. With the recession squeezing both its printing and publishing profits, the company is indicating it is tapped out for now as far as major capital investments go. And counting on the long-term viability and credit worthiness of major metro newspapers may be too much of a gamble these days.

Here's a roundup of interesting items that have appeared this week about the Transcontinental-Chronicle deal:

• The Chronicle's cool two-minute video of the plant in action, set to "The Sorcerer's Apprentice". (An ironic choice of music? You decide.)
• The Chronicle's article on Monday about the newspaper's new "wrinkle-free" era. Be sure to check out the reader comments, not all of which are glowing. One commenter says the Chronicle is now "San Francisco's trophy wife" because its role is "to hang around, look good, and not say anything." (In defense of the Chronicle, its investigative reporting -- remember when newspapers did that? -- led to the resignation this week of a college president.)
  
• SF Weekly's knockdown of the Chronicle's coverage of the new production arrangement as "an in-house infomercial". The snarky piece also hints of delivery problems on Monday.
  
• Graphic Arts Online has a rundown of the equipment in the new plant.
• An excellent article about the last day at the old Chronicle printing plant and its 200-plus employees, none of whom has been hired by Transcontinental.
• Transcontinental Monday news release, which includes some details about the new plant's energy efficiency.