Last week's decision by U.S. Attorney General Edwin Meese III to permit a joint newspaper operating agreement in Detroit, Mich., has again focused attention on this practice in our industry.
Because of the publicity that surrounded the Detroit agreement, I have had numerous questions raised about JOAs, or joint operating agreements, and this column affords me an opportunity to explain such arrangements and to note that such an agreement exists here in Salt Lake City.Mr. Meese's decision allowing the Detroit Free-Press and the Detroit News to merge their commercial operations for economic preservation is a significant one. It reaffirms the intent of the Newspaper Preservation Act passed by Congress in 1970 that freedom of the press is best served by having two competitive editorial voices in any given city.
During and following the depression years of the 1930s many newspapers in the country went out of business. The result of these closures usually meant a city or an area was left with only one newspaper, and in that sense a monopoly was created for the surviving paper.
During the 1930s two newspapers in Albuquerque, N.M., whose competitive efforts would have resulted in the demise of at least one of the papers, decided upon a the novel arrangement of combining their advertising, circulation and printing efforts, but maintaining separate news and editorial products. This assured two independent newspapers, even though there was only one commercial operation.
Because this joint agreement preserved two newspaper voices in Albuquerque, it received the attention of a number of other publishers faced with the realities of either closing down or selling out to their competitors.
While there were still many publishers who could not come to terms with their competitors, and many newspapers continued to go out of business, there were 22 cities by 1964 with successful joint operating agreements.
The agreement here in Salt Lake City began on Sept. 1, 1952, after five years of extensive circulation wars between the Deseret News and the Salt Lake Tribune.
As JOAs gained in popularity, the Justice Department gave them tacit approval, despite some antitrust aspects, until the late 1960s when action was initiated against the Tucson, Ariz., newspapers. This resulted in a Supreme Court decision in 1969 that JOAs were in violation of the Sherman Antitrust Act.
At that point Congress, balancing the importance of First Amendment and freedom of the press principles against the reach of the antitrust laws, determined that joint operating agreements should be protected in order to continue to preserve newspaper voices in each of the cities involved.
U.S. Sen. Wallace F. Bennett from Utah played a key role in forwarding through Congress the Newspaper Preservation Act, which passed the Senate 64-13 and the House 292-87.
The Newspaper Preservation Act took into account all existing JOAs at the time and provided for future joint operating agreements subject to application to and approval by the U.S. attorney general.
Thus, it was Mr. Meese's final decision that decided the Detroit case, which had proved to be the most extensively investigated application ever filed under the 1970 act. Even though an administrative law judge recommended against the Detroit proposal, Mr. Meese in his decision said he found that the Detroit Free Press was unable by any unilateral action to reverse its years of operating losses, and determined that, short of a joint operating agreement, there was little prospect for the paper to return to profitability in the competitive environment of Detroit.
Rather than permit a newspaper monopoly to occur in Detroit, with the Detroit News as the only editorial voice, the attorney general said in his decision that he was approving the joint operating agreement because the result "well serves the policy and purpose of the Newspaper Preservation Act."
Here in Salt Lake City the joint operating agreement between the News and the Tribune resulted in the creation of the Newspaper Agency Corp., the company that handles all circulation, advertising and mechanical functions for the two papers.
When first signed in 1952, the agreement was for 30 years. In 1982 it was renewed for another 30 years.
There is no question about its value in preserving both newspapers and assuring Salt Lake City of two strong, independent, competing voices.
We, along with the other 121 continuing JOAs of the country, welcome Mr. Meese's decision and say, "Well done!"