Inquirer publisher calls for changes in law

WASHINGTON - Brian P. Tierney, publisher of The Inquirer, told a congressional subcommittee yesterday that antitrust laws need to be loosened for newspapers if the industry is to reinvent itself.

Current laws are so restricting, Tierney said, that publishers from different cities are unable to discuss possible joint business ventures that ultimately could help keep separate and editorially independent newspapers running.

"I've never seen an industry so fearful of cooperation," Tierney said. "We really need help. We don't need subsidies. We need a little room to move."

As an example, he said, newspapers need to find a way to address jointly the loss of classified advertising to the Internet. But because of antitrust laws, he said, publishers find it hard to cooperate to create their own national classified base.

"We need to come up with our version of craigslist," he said.

Other testimony, however, suggested that Tierney's position faces strong opposition, including from the U.S. Justice Department.

Carl Shapiro, deputy assistant attorney general in the antitrust division, testified that the Justice Department was opposed to any additional antitrust exemptions for newspapers. The department thinks there is enough latitude in the law now to meet the needs of even struggling papers looking to merge business operations with competitors, he said.

The hearing took place before the House Judiciary Committee's Subcommittee on Courts and Competition Policy. It was triggered, in part, by a request from Speaker Nancy Pelosi (D., Calif.) that the Justice Department consider easing antitrust rules for newspapers, given the dire financial status of the industry.

Committee members and witnesses all agreed that newspapers were facing an unprecedented crisis as advertising revenue has collapsed and paper after paper - including The Inquirer and the Philadelphia Daily News - struggle for solvency. (Tierney is CEO of Philadelphia Newspapers L.L.C., which publishes the two, as well as Philly.com.)

But there were many voices questioning the wisdom of changing the antitrust laws for newspapers. U.S. Rep. John Conyers Jr. (D., Mich.) was among the skeptical.

"The newspaper industry is like the automobile industry: You don't hear from them until they are on the verge of disaster," Conyers said. "All of a sudden they need help. And they need a lot of help. And they need it now."

Among witnesses who argued against changing the antitrust rules were Bernie Lunzer, president of the Newspaper Guild, and C. Edwin Baker, a law professor at the University of Pennsylvania.

Lunzer testified that easing the antitrust laws would only lead to mergers designed to reduce costs through layoffs.

Baker argued there were better ways to aid newspapers, suggesting that the government offer tax subsidies to underwrite the cost of journalists' salaries.

Overall, Tierney, who has become increasingly vocal on matters regarding newspaper publishing nationally, was the strongest voice on behalf of easing the laws. He managed to bring the hearings to a boisterous halt at one point when he stretched to find an analogy for the way online sites use advertising to pay for content that is then offered to viewers free.

It is similar to a "dancing club" that charged $10 a beer while providing dancers to be viewed for free," he said.

Conyers looked at him quizzically for a moment. "Mr. Tierney, are we talking about a gentleman's-type club here?" he asked.

"Yes, Mr. Chairman, I guess we are," Tierney said.