The failed Phoenix strategy

Coverage of The Boston Phoenix’s demise tended to focus on the glory days of the alternative weekly and the long list of reporters who got their start there before moving on to higher-profile media positions. There was very little analysis of what went wrong financially and what the shutdown means for the ever-shrinking news business around Boston.

The Phoenix has a very different business strategy from other media outlets in town. The Globe, which used to literally print money in the form of advertising pages, has adapted to the Internet by relying more and more on circulation revenue and less and less on ad dollars. Most other print publications seem to be following that route to one degree or another, few with any great success so far.

The Phoenix, by contrast, gave itself away and relied on advertising to keep itself afloat. As classified ads, including the porn-like ads the Phoenix was known for, began migrating to the Internet, the paper never fully recovered. It apparently began facing real cash-flow problems in 2009 that only worsened over the past few years.

Publisher Stephen Mindich decided to shift to a glossy magazine format last September in the hopes of retaining (and upgrading) the local ad base while enticing new group of national advertisers to give the publication a try. Peter Kadzis, the executive editor, said that, aside from Budweiser, national advertisers were indifferent to the new format.

Some reports indicate Mindich was pumping $30,000 a week into the magazine to keep it afloat, while Kadzis says the figure was $1 million a year, or about $80,000 a month. The 50 staffers who are being let go will receive no severance pay. Mindich isn’t broke. He sold the signal of radio station WFNX for $14.5 million last May and also sold off part of the building where the Phoenix is located.

The Globe reports the paper’s assets will be liquidated to pay off $1.2 million in debt. Strangely, the company’s main asset is $500,000 in promised services and goods from advertisers. So as the paper was sinking deeper and deeper into debt, it played barter with advertisers.

Whatever the cause, the demise of the alternative weekly after 47 years was big news. The way Boston’s two newspapers played the story was interesting. The Globe ran its Phoenix story on the front page; the Herald gave it four paragraphs inside the business section of the print paper, more online.

                                                                                                                                                –BRUCE MOHL

BEACON HILL

Gov. Deval Patrick says he’s reached an agreement on a new casino compact with the Mashpee Wampanoag that has been screened by federal officials. It now awaits legislative approval. In New Hampshire, meanwhile, the state Senate approves legislation that would license one casino and bring in $80 million, the Eagle-Tribune reports.

Barbara Anderson, executive director of Citizens for Limited Taxation, gives the sorry history of previous income tax hikes, most of them described as temporary. James Roosevelt Jr. uses grandfather FDR to make the case that pushing for new taxes is never easy, even with the New Deal. Meanwhile, The Republican seems to agree that taxes should go up, but by how much is the question.

The Herald editorial page tees up Patrick’s income tax hike again, arguing that “there is no ‘crisis’ here except for the need to bail out the MBTA.”

MUNICIPAL MATTERS

A casino boat plans to start sailing into Lynn in May to take passengers out to sea to gamble, the Item reports.

The Salem City Council approves borrowing money to help finance a new senior center, the Salem News reports.

Sen. Robert Hedlund says he’s unsure if he will appeal the one-day suspension of the liquor license his Braintree bar received for overserving an intoxicated patron.

NATIONAL POLITICS/WASHINGTON

The Senate Judiciary Committee, by a 10-8 vote, revives the ban on assault weapons that expired in 2004, NPR reports (via WBUR).

The National Review wonders why Sen. Elizabeth Warren is all over private companies but is MIA on the Illinois state government whose pension fund was just charged with securities fraud. The Globe takes us into the trailer office Warren is currently working out of in Washington.

The Lowell Sun, in an editorial, slams Scott Brown for going into the political influence business at Nixon Peabody to cash in. “We thought that pickup-truck, barn-coat populist was better than that… Politics as usual.”

On second thought, Paul Krugman would like to spend some time tearing apart Rep. Paul Ryan’s budget.

Maryland moves to ban the death penalty.

ELECTIONS

Republican Senate candidate Gabriel Gomez takes a drubbing for sucking up to Gov. Deval Patrick in a bid to temporarily fill John Kerry’s seat. Two members of  his women’s coalition resign, the Globe reports. Herald columnists Howie Carr and Michael Graham both rough up Gomez.

The three GOP Senate candidates praise each other at a North Andover event that was more rally than debate, the Eagle-Tribune reports. Republican Senate candidate Michael Sullivan visits Greater Boston to explain why he’s back in the game. He also goes on NECN’s Broadside with Jim Braude and argues about whether he can cut the federal budget enough to bring it into balance.

Boston Mayor Tom Menino denies rumors he’s secretly angling to set up City Councilor Rob Consalvo as mayor. Menino’s campaign fundraising has lagged far behind the pace he set four years ago, raising speculation that he’s setting up an exit from City Hall.

RELIGION

The American Spectator says neither liberals nor conservatives know what they’re getting in Pope Francis I. But U.S. News & World Report gives you 10 facts about the new pontiff because that’s just what they do.

BUSINESS/ECONOMY

An Avon crane company is under investigation by federal safety officials after the second worker in 10 years was killed in an on-the-job accident this week.

EDUCATION

Boston Mayor Tom Menino is planning to open a new school in the North End, the Globe reports.

California legislation would allow students locked out of overcrowded core courses at state colleges and universities to take those classes online, the Los Angeles Times reports.

HEALTH CARE

The state’s highest court dismissed a defamation suit by a Canton medical device manufacturer who sued a Harvard professor after he questioned the efficacy of the company’s hip protector in the Journal of the American Medical Association.

TRANSPORTATION

Polling data from the MassINC Polling Group indicates 65 percent of Massachusetts voters are willing to pay $50 more for transportation improvements, but only 43 percent support an increase in the gas tax for general transportation uses, the State House News reports (via WBUR).

Bradley International passengers don’t think much of the TSA decision to allow small knives on planes.

ENERGY/ENVIRONMENT

The Brayton Point Power Station in Somerset is sold for a song, another sign of New England’s quickly changing energy landscape, CommonWealth reports.

Canadian-based Algonquin Power has agreed to buy New England Gas Co. in Fall River for $74 million, pending approval of Attorney General Martha Coakley.

The Cape Cod Times says the region needs to get its act together to set up suitable post-storm emergency shelters.

Wall Street and the White House are moving toward packaging renewable energy contracts into investment securities.

CRIMINAL JUSTICE

A federal appeals court orders the judge presiding over Whitey Bulger’s trial to step aside, the Globe reports. Peter Gelzinis says the gambit was just one part of an ongoing effort by Bulger to put the FBI on trial.

State officials go undercover to crack a major identity theft ring operating out of a kiosk at a store in Downtown Crossing, NECN reports.

Globe columnist Kevin Cullen stands up for Bob Ullmann, whose nomination for a Superior Court judgeship is in trouble with the Governor’s Council. Ullmann is the husband of Globe scribe Patty Wen.

The Weekly Standard puts the spotlight on the conservative push for seemingly progressive prison reforms. Commonwealth took a similar look at the movement in the Winter 2012 issue.

MEDIA

Meet the Author

Bruce Mohl

Editor, CommonWealth

About Bruce Mohl

Bruce Mohl is the editor of CommonWealth magazine. Bruce came to CommonWealth from the Boston Globe, where he spent nearly 30 years in a wide variety of positions covering business and politics. He covered the Massachusetts State House and served as the Globe’s State House bureau chief in the late 1980s. He also reported for the Globe’s Spotlight Team, winning a Loeb award in 1992 for coverage of conflicts of interest in the state’s pension system. He served as the Globe’s political editor in 1994 and went on to cover consumer issues for the newspaper. At CommonWealth, Bruce helped launch the magazine’s website and has written about a wide range of issues with a special focus on politics, tax policy, energy, and gambling. Bruce is a graduate of Ohio Wesleyan University and the Fletcher School of Law and Diplomacy at Tufts University. He lives in Dorchester.

About Bruce Mohl

Bruce Mohl is the editor of CommonWealth magazine. Bruce came to CommonWealth from the Boston Globe, where he spent nearly 30 years in a wide variety of positions covering business and politics. He covered the Massachusetts State House and served as the Globe’s State House bureau chief in the late 1980s. He also reported for the Globe’s Spotlight Team, winning a Loeb award in 1992 for coverage of conflicts of interest in the state’s pension system. He served as the Globe’s political editor in 1994 and went on to cover consumer issues for the newspaper. At CommonWealth, Bruce helped launch the magazine’s website and has written about a wide range of issues with a special focus on politics, tax policy, energy, and gambling. Bruce is a graduate of Ohio Wesleyan University and the Fletcher School of Law and Diplomacy at Tufts University. He lives in Dorchester.

A former web producer for the Tribune Co. is charged in a federal indictment with conspiring with members of the Anonymous hacking group to attack the Los Angeles Times website, according to the Justice Department. Politico reports that Matthew Keys, who went by the nickname AESCracked, is now working as deputy social media editor at Thomson Reuters.

Laura Raposa, the now-departed half of the Herald’s long-running gossip column Inside Track tells Emily Rooney why she left and reminisces about the Track’s greatest hits.