The Providence Journal Company

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The Providence Journal Company

75 Fountain Street
Providence, Rhode Island 02902
U.S.A.
(401)277-7000
Fax: (401) 277-7889
Web site: http://www.projo.com

Wholly Owned Subsidiary of A.H. Belo Corporation
Incorporated : 1884 as The Providence Printing Company
Employees : 1,200
Sales : $359 million (1998 est.)
NAIC : 51111 Newspaper Publishers

The Providence Journal Company owns the Providence Journal, the longest continuously published daily newspaper in the United States. The Journal’s history goes back almost 180 years and includes several news publishing milestones, as well as four Pulitzer Prizes. Beginning in the late 1940s the company began to diversify, acquiring or starting up radio and TV stations, a printing business, cable television systems, and a cellular telephone network, many of which were sold off in the 1990s. Following its 1996 acquisition by the Dallas, Texas-based A.H. Belo Corporation, the Journal became part of a media conglomerate that owns 17 TV stations and seven newspapers.

Early Years

The Providence Journal Company traces its beginnings to January 3,1820, when the Manufacturers’ & Farmers’ Journal, Providence & Pawtucket Advertiser was first published in Providence, Rhode Island. Founded at the urging of a group of local manufacturers, and published by “Honest” John Miller in association with a local bookseller, the paper’s first issue announced that it would “be devoted to the support of the Manufacturing and American policy. It will be a medium of Scientif-ick, Manufacturing and Mercantile Information; and a faithful Reporter of the PASSING NEWS.” Nine years later the paper expanded from two issues per week to six, changing its name to the Providence Daily Journal and General Advertiser.

Daily publication proved less profitable, however, and in 1838 John Miller was forced to sell out his remaining interest in the paper, which was purchased by Joseph Knowles and William L. Burroughs. Over the next few years ownership of the paper shifted as Burroughs sold his stake to George Danielson and Henry B. Anthony. The business was incorporated as the Providence Printing Company in 1884, the year both Anthony and Danielson died, with ownership of the stock going to their families. In 1885 the name was changed to the Providence Journal Company, and the company began publication of the Providence Sunday Journal, which would eventually bring the paper its largest circulation figures. During the Civil War a second edition was added, the Evening Bulletin. Several weekly and semi-weekly papers were also started or acquired during the company’s early years.

During the middle of the 19th century, the Journal had been strongly supportive of the Republican Party, coming to be known by the nickname “The Republican Bible.” Under Danielson and Anthony, the latter elected U.S. Senator in 1858, the paper’s support for Republican candidates and issues had been particularly enthusiastic. However, following the deaths of Danielson and Anthony, the paper began to take on a less biased perspective, and in 1886 published a series of criticisms of party boss Charles R. Bray ton and his cronies. Two years later the Journal was officially drummed out of the fold at the Rhode Island Republican party’s state convention. The following day the paper published an editorial that officially declared its political independence, a position that has been maintained ever since.

Early on the Journal became noted for exploring new technologies, being one of the first newspapers to purchase “hot metal” Linotype machines to set type in 1889, and in 1903 acquiring wireless telegraph equipment to aid in news gathering. The first telegraph site was installed by radio pioneer Lee De Forest on nearby Block Island both to enable news gathering and to transmit text from the mainland to the island, where the Journal Company briefly published a daily newspaper. The company also installed wireless equipment at Rhode Island’s Point Judith and aboard the steamer Plymouth. These operations were phased out after several years, following storm damage and financial losses.

Before the age of radio the Journal also “broadcast” sports events from a platform attached to the side of the paper’s headquarters. A Journal staffer was handed a stream of wire reports through a window to give a play-by-play account to a crowd assembled in the street. The paper delayed the feed to its “megaphone man” just enough so that as the final moments of the game were described, newsboys could flood into the crowd with papers hot off the press that covered the event in its entirety.

World War I: The Journal Backs Britain

The paper gained particular notoriety during World War I, when its editor, the blustery, enigmatic Australian immigrant John Rathom, positioned the Journal firmly on the side of the Allies. During the years before American entry into the fighting, Rathom frequently published unique information about German and Austrian activities, to the extent that it was widely suspected that British intelligence was supplying the paper with information. Apparently this was actually the case, as Rathom had a secret contact in the British embassy in New York. The German government allegedly attempted to bribe Rathom to change the Journal’s position, to no avail. When the United States finally entered the war in 1917 on the side of the Allies, it was partially due to the efforts of Rathom and the Journal to stir up public sentiment against the Central Powers.

Several years later Rathom’s ever-growing exaggeration of his and the Journal’s prewar achievements got him into trouble with the U.S. government. Following his move to publish an embellished account of his and the paper’s efforts in a magazine, a letter in which he admitted his guilt was publicly released. Rathom remained editor until his death in 1923, despite this embarrassment.

In 1925 the paper became the first in the country to expand its coverage statewide, opening news bureaus that were located in such a way that, theoretically, no potential story was more than 20 minutes away. The paper also broadened its focus to treat the entire state as if it were a single metropolis. These changes were made under managing editor Sevellon Brown, who was named editor in 1938. In 1937 the Journal’s only competing Providence-based daily, the Star-Tribune, went bankrupt and was sold at auction. Believing that the Journal was better off with competition, the Providence Journal Company purchased its rival and kept it running for four months. The company finally shut the Star-Tribune down, not wishing to cut into the Journal’s own readership. Since that time the Journal had no other Providence daily to compete with.

The paper won its first Pulitzer Prize in 1945, when chief editorial writer George W. Potter was honored for a series of essays. A second Pulitzer came in 1953, when the paper’s entire editorial staff was recognized for local deadline reporting. Through a series of fortuitous coincidences, and with the help of established contacts, a bank robbery and hostage-taking situation were covered with astonishing thoroughness and speed. Only hours after the mid-day events had unfolded, the Evening Bulletin was on the streets with an edition that included detailed, accurate reporting and dramatic photographs.

Expanding Operations Through the 1980s

Beginning in the late 1940s, the Journal Company started to expand into other broadcast media, creating an FM radio station in 1948 and purchasing an AM station in 1954. Both of these were housed in Journal headquarters in Providence. With the dual impact of television and a depressed Rhode Island economy affecting newspaper circulation in the early 1960s, the Journal Company sought further ways to diversify. In 1962 the company formed a printing subsidiary, Providence Gravure, Inc., which eventually operated plants in four states that printed Sunday magazine sections and publications such as TV Guide and Time.

The Journal Company also entered the cable television arena, purchasing a small Westerly, Rhode Island-based cable system in 1968. The company organized a new subsidiary, Colony Communications, to manage this operation and develop others like it. Within a decade Colony was operating cable systems in almost 40 communities and serving more than 100,000 subscribers. The Journal Company entered television broadcasting directly in 1978 when it purchased WPHL in Philadelphia. Other television stations were later added in Tucson, Albuquerque, Santa Fe, and Louisville. The company was also quick to enter the pager and cellular telephone businesses, forming a new subsidiary called PJC Cellular in 1983.

The Providence Journal’s history of technical innovation added a new chapter in 1985 when it became the first U.S. newspaper to use flexographic printing presses. This type of printing required much more precision from pressmen than the older letterpress and offset methods but used inks that did not rub off on readers’ hands, allowed full-color printing, and caused significantly less waste of paper, at a time when newsprint costs were on the rise. After proving viable with the Journal, other papers soon followed suit and ordered flexographic presses.

Company Perspectives

The Providence Journal company’s roots in publishing are firmly planted in the Providence Journal-Bulletin— America’s oldest major daily newspaper of general circulation in continuous publication.

The paper that was to become the Providence Journal-Bulletin was born as the Manufacturers’ & Farmers’ Journal, Providence & Pawtucket Advertiser. In 1829, the twice-weekly paper became a daily, the Providence Journal; by 1863, the company added the Evening Bulletin to bring Rhode Island the latest news of the Civil War.

Today, the Providence Journal-Bulletin’s tradition is more than longevity alone. Its history chronicles nearly two centuries of leadership in news coverage, of constant movement in the forefront of communications technology and an unwavering commitment to the betterment of the communities it serves.

In 1986 the Journal found itself in hot water after it published excerpts from wiretapped conversations dating from the 1960s, in defiance of a court ban. Despite the fact that the suppression order had been quickly rescinded, the U.S. Supreme Court found that the paper had erred in publishing the material and fined it $100,000, giving executive editor Charles McC. Hauser an 18-month suspended sentence. The company also sold the Providence Gravure printing business in 1986, a year that saw corporate revenues reach $212.6 million.

1990s: Further Expansion and Public Stock Offering

In 1990 the Journal Company sold its cellular subsidiary to GTE Corporation for $750 million. Two years later the company, in association with the investment firm Kelso and Co., purchased a package of five television stations and several cable systems for $550 million from King Broadcasting. This deal put the total number of stations in the Journal company’s portfolio at nine, along with several others that it managed under Local Marketing Agreements. Over the next several years the company also made moves into cable broadcasting, investing in start-ups The TV Food Network and America’s Health Network. Neither of these ventures made much headway, however.

In 1994 the Journal received a fourth Pulitzer Prize, for investigative reporting into corruption within Rhode Island’s courts. (The paper had won its third Pulitzer in 1974, for an investigation by reporter Jack White into Richard Nixon’s tax returns that resulted in the President paying $500,000 in back taxes.) In 1995 the company first began to offer the Journal on the Internet, via Prodigy’s online network. After several disappointing years, the company moved for online independence, starting it own web site at projo.com.

Major changes were made to the newspaper in 1995. The Bulletin, which for some time had been merely a late edition of the morning Journal, was phased out entirely. The paper also dropped its Sunday magazine section, opting for the nationally syndicated Parade magazine. These moves were attributed to the surging price of newsprint and declining overall revenues. Also in 1995, the company sold its Colony Cablevision subsidiary to Continental Cablevision. The cable business, with 800,000 subscribers, was exchanged for 30 million shares of Continental stock.

In the spring of 1996, the Providence Journal Company went public, selling over $100 million worth of stock. While the company’s board approved the offering, some members of the families who owned the paper expressed regret at entering the realm of public ownership. Still, the company needed the infusion of cash to help offset losses from declining advertising revenues at the paper and the two stalled cable networks in which the company had invested. In a move that was a surprise to many, three months after the stock offering the company was purchased for $1.54 billion in a friendly takeover by A.H. Belo, a Dallas, Texas-based news and television conglomerate. Among the parent’s holdings were seven television stations and several newspapers, including the Dallas Morning News. Because both companies owned television stations in Seattle, one was exchanged for a station in another market. A year later the Journal company’s America’s Health Network interest was sold, as its prospects for profitability remained distant.

In 1998 workers at projo.com won union representation, over the objections of the paper, which considered them production, rather than editorial, personnel. Members of the paper’s news-gathering departments were represented by the Newspaper Guild, and the union had appealed to the National Labor Relations Board to force the paper to recognize the web site workers’ union affiliation and grant them the higher pay of editorial staff. At the 11th hour the paper backed down and met the union’s demands.

In A.H. Belo’s year-end earnings report for 1998, the parent company noted that the Journal had had an “outstanding” year, with “double-digit cash flow growth.” Circulation of the daily Journal stood at nearly 170,000, with the Sunday edition at 244,000. In early 1999 the company received a new publisher and CEO when president Howard Sutton took over upon Stephen Hamblett’s retirement. Hamblett had been CEO, publisher, and chairman since 1987 following the death of third-generation Journal publisher Michael Metcalf in a bicycle accident.

As it adapted to its place in the A.H. Belo fold, the Journal Company was getting back to focusing on what it had done best from the start, putting out a quality newspaper. Despite having slimmed down to a single, morning daily, and having halted the publication of its own Sunday magazine, the Providence Journal was still a highly regarded paper with extensive statewide coverage and a long tradition of integrity and innovation. With non-news interests reduced through divestment or their incorporation into the larger Belo portfolio, it appeared likely that the company could continue to adapt to the changes wrought by television and the Internet and maintain the Journal’s position among America’s finest newspapers.