"All of you are overhead"

The above quote from Sam Zell to a bunch of journalists is sure to prompt a lot of negative comments from journalists.

But the smart ones will realize that he's right.

Zell, owner of the Tribune Company, said this and a few other choice things at a meeting with the Tribune's Washington bureau in February. (Click here for a link to a write up of the meeting and audio.)

The full quote from Zell:

"This is the first unit of Tribune that I've talked to that doesn't generate any revenue. So all of you are overhead."

Another gem:

"Three guys in a garage create YouTube, and we've got 800 people in Chicago who don't know their ass from a hole in the ground!"

You can go on all day explaining how Sam Zell doesn't know what he's talking about. But at the heart of the matter is the simple fact that newspapers (and magazines) are businesses designed to generate revenue, part of which pays the salaries of reporters. And under the current business model advertising pays the bills. Yes, content attracts readers but journalists are overhead, just as are truck drivers, deliverymen, painters, etc.

And to Zell's credit, he understands that and he's challenged journalists to think about creating content that readers will want to read. Radical idea but spot on. Until now most newspaper executives were afraid to say this for fear of being seen as turncoats. Zell doesn't care. And Zell is right:

The recording of the Washington meeting gives fresh insight into Zell's annoyance at what he sees as the self-importance of conventional journalists. He says they're peddling goods the public just doesn't want to read: too much insider politics and Iraq, not enough local news.

It's about time.