Miami Herald Media Company

Type: Wholly Owned Subsidiary of the McClatchy Company
Address: One Herald Plaza, Miami, Florida, 33132, U.S.A.
Telephone: (305) 350-2111
Toll Free: (800) 437-2535
Web: http://www.Miami-Herald.com
Employees: 1,600
Sales: not available
Founded: 1903 as
Miami Evening Record
NAIC: 511110 Newspaper Publishers
SIC: 2711 Newspapers

The Miami Herald Media Company operates the Miami Herald, the leading daily newspaper in south Florida. It also operates the Spanish-language newspaper El Nuevo Herald for the Miami market and distributes the Miami Herald International Edition in major markets in Latin America and the Caribbean. The Miami Herald Media Co. also produces a variety of magazines, tourism guides, and niche publications in both Spanish and English, such as Home & Design, Condo Living, and Travel Magazine. The company runs an extensive news web site, www.Miami-Herald.com, and has partnerships with several Florida radio stations. The Herald owns an 800,000-square-foot plant, and maintains news bureaus in seven Florida cities as well as in Washington, D.C.; Bogota, Colombia; and Lima, Peru. The Miami Herald has been publishing since 1903, when Miami was a tiny frontier town. Its market is unique in the United States, with 44 percent of the population identifying as Hispanic, more than three times the national average. The Herald was the flagship paper of the Knight-Ridder newspaper chain until 2006, when Knight-Ridder was bought by the McClatchy Company.

Early Years

The Miami Herald was established in 1903 as the Miami Evening Record, the venture of publisher A. L. LaSalle and editor Frank B. Stoneman. Miami was at that time still a newly established town, founded in 1895 by three families. Miami grew quite rapidly, so that by 1909, the population was 5,000. Miami was home to more than the Evening Record. The Miami Metropolis and the Miami Morning News predated the paper. Much of Miami and south Florida was owned by Henry M. Flagler, one of the town's founders and the president of Flagler System, a corporation that built and ran the Florida East Coast Railway, among other enterprises. Henry Flagler was a partner of John D. Rockefeller in Standard Oil, and was an enormously influential force in the Miami area. In 1907, LaSalle and Stoneman bought out one of their competitors, the Miami Morning News, and the paper changed its name to the Miami News-Record. To make the acquisition, the newspapermen borrowed from Flagler. At the same time, the other Miami paper, the Metropolis, came under the sway of a fiery new editor, Bobo Dean. Dean had been a strong supporter of Henry Flagler early in his career, but at the Metropolis, he put out story after story critical of the massive Flagler System. The News-Record, heavily in Flagler's debt, did not dare run the kind of taunting stories that the Metropolis put out. Made to look tame by its competitor's more daring brand of journalism, the News-Record foundered, and by 1910 was close to bankruptcy.

About to close its doors, the young newspaper looked around for a rescuer. An Indiana lawyer, Frank B. Shutts, had just moved to town to become the receiver for a failed Miami bank. Shutts was what would in business circles today be called a "turnaround artist," and LaSalle and Stoneman came to him, asking him to take their business under his wing. Shutts went to New York to seek out the elderly Henry Flagler, the News-Record's largest creditor. Shutts recommended that Flagler buy out the paper and keep it in business. Flagler agreed, but only if Shutts would become publisher. This was not exactly what Shutts had had in mind. Nevertheless, he said yes. On December 1, 1910, the paper reorganized with Shutts as publisher and Stoneman as editor, taking the new name Miami Herald.

Shutts was not a journalist, and he favored a very staid, conservative type of newspaper. The early Miami Herald had a rather dull front page, eschewing bold headlines. It put out a daily paper six days a week, which ran to eight pages, and later added a slightly longer Sunday edition. In 1912, its circulation was 2,000. Circulation grew rapidly in the next decade, as Miami entered its boom years. By 1921, the Herald's circulation stood at 9,350, while the population of Miami had grown to 30,000. The city expanded rapidly, and the Herald was filled with classified advertising. The Herald bought a new building in 1922, and then over the next few years ran its aging presses in continuous shifts as the paper grew at an astounding rate.

The Florida Land Boom

A huge speculative bubble in Florida real estate began to swell in 1923. Thousands of people poured into south Florida, and Miami's population grew from 45,000 in 1922 to 70,000 in 1923, and then to some 177,000 in 1925. Housing could not be built fast enough, while multistoried office buildings went up all over Miami's downtown. The Miami Herald was a major source of information for all the newcomers, and the paper was so short-staffed that virtually anyone who walked in the door was offered a job. For some months over 1925 and 1926, the Miami Herald was actually the largest newspaper in the entire world, when measured in terms of lines of advertising. The Herald occupied three adjoining buildings by this time, and in 1925 built a fourth building to hold its mechanical plant. The paper's circulation reached 47,600 at its peak in 1927 and then dropped rapidly.

Thousands of speculators made massive paper profits by buying plots of Florida land with only a 10 percent down payment and then reselling them within hours or days as prices spiraled upward. Many acres that sold for extravagant prices were in the depths of the Everglades or were otherwise unreachable by road or rail. The boom ended in early 1926. A ship had capsized in Miami's harbor in January, and in the six weeks it took to reopen the port, the frenzy of real estate speculation had simmered down. In September 1926, a devastating hurricane hit Miami, killing hundreds, injuring hundreds more, and damaging thousands of homes and buildings. These events combined to slow Miami's wild growth. For a while, the Herald was unaffected, as it was still a vital source of news and information for the populace. However, circulation dropped year by year in the late 1920s, and finally sank to around 38,000 in 1934. By that time, the whole country was deep in the grip of the Great Depression.

Sale to Knight Family in 1937

Miami's economy was a little different than that of the nation as a whole. By 1937, with most of the country still stagnant and suffering, the Miami area was at the beginning of another growth spurt. Miami's potential as a retirement community was just being realized, and builders were putting up new hotels and houses. The Herald was doing well in terms of the amount of classified advertising it carried, and circulation was once again growing. Its presses were old and outdated, however, and the paper remained exceedingly stuffy and conservative, especially compared to a new competitor, the tabloid-style Miami Tribune. Frank Shutts was ready to retire as owner and publisher of the paper, but his position was difficult. Although he had a lavish lifestyle, he was deeply in debt. He had borrowed from various friends and business partners to keep the newspaper going, and he apparently did not really know the extent of his, or his newspaper's, debts.

Shutts wanted to escape the complications of the newspaper, and he gingerly offered the Herald to two Ohio newspapermen, James and John Knight. The Knight brothers had inherited the Akron Beacon Journal from their father in 1933, and had struggled over the next four years to get that paper out of debt. The Knights liked Miami, and they wanted the Herald, although not at Shutts' price. They eventually talked him down from $3 million to $2.25 million, and in October 1937, they closed the deal and became the Miami Herald's new owners. Within two years, the paper had increased its circulation by 14,000. The Knights updated the paper's look with more lively type and formatting. The paper's rather stodgy outlook also changed under the Knights, as the new publishers were less conservative than Shutts had been. Founding editor Frank Stoneman died in 1941. Even under the new owners, he had continued to write somber and old-fashioned editorials. With his passing, the paper was in a new era altogether. The Herald moved into a new building that year.

World War II and Postwar Years

Miami became a center of military activity as the United States entered World War II. After the war, many of the military men and women who had been stationed in Miami or who had passed through decided to settle there. Miami's population came close to doubling between 1940 and 1950. The Herald's circulation also doubled over that time period. Meanwhile, the Herald's owners expanded their chain of newspapers. They not only ran the Miami Herald and the Akron Beacon Journal, but in 1940 also bought the Detroit Free Press, and four years later bought the Chicago Daily News. Knight Newspapers, as the parent company was called, continued to make acquisitions in the 1950s and 1960s, buying papers in North Carolina, the Tallahassee Democrat, and in 1969 buying five daily papers, including the Philadelphia Inquirer and the Boca Raton News.

The Miami Herald was not neglected while the parent company was on its buying spree. In 1946, the Herald began shipping an international edition to cities in the Caribbean and in Central and South America. This was an English-language paper that was bought by readers with ties to the United States and all those who had an interest in U.S. business and politics. This edition was at first called the Clipper, because it was flown out on Pan American Airways planes known as "Clipper Ships." The Clipper started with a press run of 50 copies, and by 1967 had a circulation of some 11,000. Readership may have been significantly higher, since a single paper was said to pass through 20 or 30 hands. The Herald was in every way a leading international paper, with reporters stationed throughout the world, and a definitely cosmopolitan rather than provincial outlook.

The Herald invested in a new building, spending $30 million in 1960 for a landmark building named One Herald Plaza, which it continued to occupy into the 21st century. Circulation had climbed to 322,500 by 1963. Over the next ten years, circulation continued to increase, reaching 404,846 in 1973. The paper also grew in terms of the amount of advertising it carried, and in news coverage. In 1972 the Herald was the nation's leading newspaper as measured in terms of lines of news coverage, surpassing both the New York Times and the Los Angeles Times. The Herald was quite a bulky paper, with Sunday editions running from 400 to 500 pages and sometimes weighing as much as five pounds. With quantity came quality, too, as Time magazine listed the Herald as one of the ten best daily newspapers in the country in 1974. The Herald was also profitable. Its financial soundness allowed parent Knight Newspapers to buy more daily and community newspapers across the country. Knight went public in 1969, and its stock quickly sold out as investors flocked to it.

Changes in the Two Next Decades

By 1974, Knight Newspapers owned a string of 16 newspapers, with the Miami Herald among its most prominent properties. The parent company had revenue of $342 million that year. Knight announced it was merging with a West Coast newspaper chain, Ridder Publications, a Los Angeles-based firm with 19 newspapers and revenue of $166 million. The Herald's parent was then renamed Knight-Ridder Newspapers, Inc. Headquarters remained in Miami. The late 1970s and 1980s proved more difficult times for the newspaper. The rising cost of newsprint meant the long and lavish Herald was increasingly expensive to produce. The paper's circulation, which had grown precipitously, held level through the 1980s, at around 407,000.

In some ways, the Herald was slow to adapt to the needs of Miami's Spanish-speaking population, and this caused some missteps. In 1976, the Herald started producing a Spanish-language insert to the paper, called El Herald. The Herald's executive editor described El Herald as "a 'transitional' paper that would accustom Cubans to reading the English paper," according to a profile of the paper in the New York Times (March 5, 1987). This seemed like a wise move, since the Miami area was a magnet for Cuban and other Spanish-speaking immigrants. By the mid-1980s, over 40 percent of the area's population was Hispanic. The traditional pattern of immigration in the United States was typically toward assimilation, where the first generation might cling to their home language and customs, but their children and grandchildren would speak English and have more of a mainstream culture. If this had been true in Miami, then a transitional paper would have been what was needed. However, Miami's Cuban population in particular resisted assimilation, and instead founded a vibrant Spanish-speaking community that operated within and beside the now minority Anglo culture. The Herald in the 1980s looked very much like a paper of the old guard, with few Spanish-speaking reporters and no Hispanics on its board. By 1987, the Spanish-language insert still had only two reporters assigned to it. The Herald missed out on stories about the Hispanic community and had trouble covering Hispanic cultural events. The paper too was constantly at odds with the more right-wing politics of leaders of the Cuban community.

In the early 1980s, the Herald began moving into the towns north of Miami. The demographics in Palm Beach County and Broward County looked similar to the demographics of Herald subscribers. However, this move gained the paper little in circulation. In the late 1980s, the Herald changed direction again and began a conscious push to appeal to the Spanish-speaking community in Miami. One major move was to hire a Cuban American associate editor, Angel Castillo. However, the paper still found itself at times at odds with the Cuban population. The Herald's publisher and two other Knight-Ridder executives received death threats in 1992 after angering the head of a leading Cuban exile group, the Cuban American National Foundation. In the New York Times 1987 profile of the Herald, the paper's circulation director lamented that no other "paper in the country has as complex a marketing problem as we do."

Shifting Leadership

The Herald throughout the 1990s continued to formulate new ways to deal with its changing readership and stagnant circulation. The newspaper cut jobs and closed down some news bureaus in the early 1990s. Its focus on news also shifted somewhat; part of a new strategic plan in 1995 was to concentrate on stories in nine subject areas that readers had identified as being of most interest to them. The readers' list was topped by local government, but did not include either national or international politics. This was particularly striking as the Herald had been considered a notable leader in these areas 20 years earlier.

In 1995, the Herald's Spanish-language edition, then called El Nuevo Herald, got a new publisher, Alberto Ibarguen. Ibarguen became publisher of the Miami Herald itself three years later. Ibarguen was half-Cuban, half-Puerto Rican, and as such he was considered to have more insight into Miami's immigrant population than previous publishers. Ibarguen moved to differentiate El Nuevo Herald from the English-language paper, and to market a distinct version of the Herald for suburban readers. He also began planning new ways to get the Herald to readers in Latin America. Ibarguen came in at a difficult time. The paper's profit margin was slipping, circulation had fallen from 386,000 in 1995 to 350,000 in 1997, and $32 million in budget cuts a few years earlier had seemingly done little to halt these declines.

Ibarguen countered these problems by investing $120 million in new equipment and unveiling a colorful, updated new design for the paper. Ibarguen was also dedicated to courting Hispanic readers, whether they read the paper in English or in Spanish. The paper opened new news bureaus in Bogota, Colombia, and in Managua, Nicaragua. Although Hispanic readers were central to the Herald's survival, the paper also gained ground with its suburban readers. It had long been number two in the northern suburbs to the Fort Lauderdale Sun-Sentinel. By the late 1990s, the difference in circulation between the Herald and the Sun-Sentinel had lessened. One other change in the late 1990s was the relocation of parent company Knight-Ridder from Miami to San Jose, California.

By 2003, the Herald had met its target as far as profit margin, reaching the 22 percent figure set by parent Knight-Ridder. The Miami Herald was said to be among the most profitable papers in the Knight-Ridder stable by the early 2000s. The Herald had also seen its circulation rise to about 392,000 in 2003. This figure was bolstered by the new strength of the Spanish-language edition, El Nuevo Herald.

The news business was anything but smooth, however, as new challenges rose up in the middle of the decade. In July 2005, a Miami politician distraught over coming media reports of a personal scandal committed suicide in the lobby of the Herald. The paper then fired a reporter who had illegally recorded a phone conversation with the politician just before his death. Colleagues of the deceased politician called for a boycott of the paper, while journalists across the country expressed outrage at the firing of the reporter. Shortly after, the Herald got a new publisher, Jesus Diaz. Then in 2006, parent company Knight-Ridder was acquired by the California-based McClatchy Company, another media conglomerate. Diaz lasted barely a year as the Herald's publisher. After firing several reporters who had received payment for speaking on an anti-Castro radio network, Diaz hired the reporters back and handed in his resignation. Diaz complained that he could no longer control the Herald's newsroom, and his post was taken by David Landsberg. Clearly, the paper's relations with the Cuban community remained turbulent, and the middle years of the first decade of the 21st century were not a peaceful time for the Herald. Meanwhile, new parent McClatchy seemed as concerned about costs as Knight-Ridder had been. The year 2007 saw a round of layoffs at the paper's call center, where customer complaints were handled.

Principal Competitors

News & Sentinel Company Inc.

Further Reading

Barringer, Felicity, "Miami Herald Copes with Bilingualism, Staff Desertions, and an Energized Rival," New York Times, November 15, 1999, p. C1.

Bussey, Jane, "Herald Parent Makes 'Cost-Effective' Decision," Miami Herald, August 1, 2007.

Deogun, Nikhil, "Lawrence to Leave Post as Publisher of Miami Herald," Wall Street Journal, August 5, 1998, p. 1.

Glaberson, William, "The Miami Herald's Ninefold Path to Reader Enlightenment Raises Some Journalists' Eyebrows," New York Times, October 23, 1995, p. D7.

Jaffe, Greg, "Publishing: At the Miami Herald," Wall Street Journal, September 21, 1998, p. B1.

Seelye, Katherine Q., "Miami Publisher Steps Down over Payments to Reporters," New York Times, October 4, 2006, p. A16.

Smiley, Nixon, Knights of the Fourth Estate, Miami: E.A. Seemann Publishing, 1974.

Villano, David, "Finding Its Footing," Florida Trend, May 2003, p. 18.

------, "Hope at the Herald," Florida Trend, July 1, 2006, p. 26.

— A. Woodward