A tall, heavy-hung gentleman in his seventies yet surprisingly quick-stepping, got off a train at Winslow, Ariz, one day last week and boarded a plane for San Simeon, Calif. It was the Lord of San
Simeon himself, a sadder but wiser and sounder William Randolph Hearst. His return from New York was not entirely a Waterloo. He was sad because he had killed his dearly beloved New York American (TIME, July 5).* He felt wiser because he had at last taken the advice of his business associates who urged him to drop or consolidate losing properties. He was sounder because he was putting his financial house in order all along the line and had just concluded a constructive deal in Rochester and Albany, N. Y.
The deal was with Frank Ernest Gannett, 60, owner of a chain of 19 ultra-respectable newspapers mostly in New York State. By its terms Hearst cleared out of Rochester, where he had been losing $125,000 a year and where he once gave away automobiles to lure circulation, leaving Gannett a virtual monopoly in that city with his evening Times-Union and morning and Sunday Democrat & Chronicle. Hearst's Rochester employes, out of jobs, were attempting at week's end to raise money to start a new paper.
Rochester was, in 1918, the anchor city of the Gannett chain. Mr. Hearst invaded it in 1922 during his last dream of a personal political career. Albany, on the other hand, had been a Hearst city (evening and Sunday Times-Union) for four years when Publisher Gannett marched there in 1928 to buy the Knickerbocker Press (morning) and News (evening). With Mr. Hearst now out of Rochester, Mr. Gannett was agreeable last week to merging the old (1842) Knickerbocker Press with his News, taking Albany's evening field for the resultant News-Press, and letting Mr. Hearst shift the unprofitable evening Times-Union into the morning field unopposed. Mr. Gannett thereby netted two new monopolies to Mr. Hearst's one, and Mr. Hearst had exchanged two minuses for one probable plus.
Thus unfolded were Steps Nos. 2 and 3 of the great Hearst retrenchment plan of 1937, necessitated by the fact that not even William Randolph Hearst can carry losing properties indefinitely and that he, though hale at 74, is getting no younger. His plans to mortgage a big portion of his properties to the public for $35,500,000 cash remained stalled in SEC last week and pending their approval, by a none-too-friendly Administration, Mr. Hearst's feelings must have continued akin to those of Hearst employes who still waited to see the full extent of the great retrenchment. Reassuring to the staff of his Chicago Herald & Examiner last week was a statement from the Chief that no modification, consolidation, suspension or sale of that property was contemplated. Yet the fact remained that the Chicago Hearst staff had been experimenting with tabloid formats, apparently motivated by the inroads of the new young tabloid Chicago Times upon the Chicago American's, evening circulation.