How a biotech billionaire and journalism vet aim to rebuild the LA Times

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Local biotech billionaire and surgeon Dr. Patrick Soon-Shiong paid $500 million for the LA Times, the San Diego Union-Tribune and a few other local papers. He quickly hired Norman Pearlstine as the new executive editor for the Times. Pearlstine has spent some 50 years in journalism. He’s been at Time magazine, the Wall Street Journal, Bloomberg News and Forbes. They plan to turn the paper around after years of turmoil, top editors coming and going, and low staff morale.

Interview highlights

Why buying the papers was a personal decision

Dr. Patrick Soon-Shiong: I was born in South Africa in apartheid, and the only ability for us to understand how to deal with it really was the freedom of the press. And I think it is also interesting — the sense that the country that I was born in did not have TV. So the only form of news was the radio and the newsprint. So it’s very personal in the sense that the importance of the paper as a village should inform, inspire the nation, as well as being the opportunity for speaking truth to power on behalf of the people.

There’s renewed emphasis on the media’s power in confronting the Trump Administration. Are there similarities between what’s happening now in the U.S., and in South Africa when Soon-Shiong was growing up?

Soon-Shiong: I see the similarities as it relates to the world, frankly — the whole unforeseen consequences of technology and social media. I think this concept, as I said in my letter, of fake news is the cancer of our times… The idea of having social media, and the inability to separate what is news that has been developed with the integrity of journalistic skills, as opposed to news that’s developed for clickbait and driving advertising dollars. The opportunity to address that is to really support true journalism, whether it be investigative reporting.  The bigger deeper picture to create a social network in which there’s trust.

If you look at this very, very, very sad issue today of immigration – and I’m an immigrant — and the children… If you frame the questions differently — nothing to do with right, left, middle, blue or red – but if you frame the questions from a perspective of common good in humanity, all of a sudden, you can have a civil conversation. And I think the newspapers allow us to do that.

Soon-Shiong had dinner with President-Elect Trump in November 2016, and afterward tweeted, “Incredible honor dining w/Pres-elect @realDonaldTrump last night. He truly wants to advance #healthcare for all.” Then Trump tried dismantling Obamacare. Does Soon-Shiong regret tweeting that?

Soon-Shiong: No, look, I think again, this is exactly the discourse that I think is destroying the country, where you relate it to a person versus to an issue. I’ve worked with Joe Biden. I’ve worked with Hillary Clinton. I’ve work with the president when he invited me to address an issue that is important. I spent eight years working, going up and down to Washington, to say we need to treat the underserved. But what is ailing in this nation now is the waste with regard to health insurance, and we are spending $200 billion in third party administration in managing fee for service. It was very complex and complex, and he recognized this is complex, and invited me to give my insight. And to his credit, he gave me full access to the Health and Human Services Secretary — then (Tom) Price — to the people in the administration, to try and understand the issues, which are complex. So I think again, the discourse where we said, ‘OK, is this to do with President Trump or is it to do with President Obama?’ is missing the point. This has to do with the health of the nation. My focus is on outcomes, rather than trying to pin a label.

…At the end of the day, are people who are underserved, even people who are middle class, are getting the best care? And even our veterans – are they getting the best care? The answer is absolutely not. This administration gave me the opportunity present the solutions. It’s not being executed at this point, but it’s complex, right? I presented the exact same solutions for eight years to President Obama. I presented solutions to Vice President Biden with regard to how we need to transform cancer care. The issue really is … what are we doing on behalf of the patient, and only in the interest of the patient? The platform of the L.A. Times now allows us to maybe explain — over time — the issues, and give both sides views, where the views is really to drive to a better outcome for all.

Investing resources into the paper 

Soon-Shiong: California is where the future of the nation is. So we have an opportunity here through the L.A. Times to actually bring what California stands for, which is clean air, good climate, good food, good nutrition, sports and entertainment, and health and technology. And absolutely I think we will put resources so that it becomes a paper of information.

How Norman Pearlstine will guide the paper to cover the most relevant issues — with fewer resources than before

Norman Pearlstine: Admittedly the number of employees is significantly less than, say, where it was 15 years ago. At the same time, with an editorial staff of 400, which is one of the largest staffs in the country, the publication is capable of doing extraordinary work, and has in fact been doing it through a very turbulent period over the last year. So I’d say first thing to do is get to know the staff a whole lot better, and understand where it is strong, where it needs support, and where we’re allocating resources.

The second thing I need to do is to present to Dr. Soon-Shiong — as soon as practical — a plan that identifies the resources we have, and then the resources we need to execute against that vision that he has just articulated for you.

Whether Pearlstine won’t be staying long as the top editor of The Times

Pearlstine: That’s an open question. I’m an at-will employee, serving as long as Patrick thinks that makes sense for me to do so. I think that realistically, one of my jobs is to really put together a next generation of leadership for the Los Angeles Times, which includes some people who are here, some people that we’d like to bring in. And from that, at some point in the future, there should be another editor-in-chief. And that’s one of the things that I’m working on. But we haven’t really put a date on that because there’s just a lot of work that needs to be done to position ourselves for that.

What the paper needs to cover better than it does now

Pearlstine: You have to be committed to coverage of your community, and that’s something I think we do well, but we can always do better. Secondly, there are some very broad issues of social and economic importance that one clearly wants to focus on if you think of yourself as being based in California, being based in the West. And that would certainly include environment, immigration, homelessness in terms of social issues. In terms of coverage, certainly it would include coverage of business, of technology, of entrepreneurship. And that is both regionally and nationally.

And then I think there are certain places where we really want to own the coverage because of where we’re based. Sports, I think is one example — with the Olympics coming, with the World Cup coming, and with so many major league teams, and with sports being so important in the lives of many of our audiences.

Los Angeles is increasingly a food capital for the country, and we should be stronger on food, on lifestyle.

And then as part of that, the Los Angeles Times is one of a handful of publications that can really inform a global audience with regard to a number of very important issues that either begin in the West or the Pacific Rim — or National, and that would imply a much stronger Washington bureaus as well.

Soon-Shiong told NPR that he might have overpaid for the papers. So is he prepared to weather a loss for a while?

Soon-Shiong: Well the motivation of this was to really rebuild this paper. And the answer is we need to make the appropriate investments. But I don’t think an important paper can survive on so-called philanthropy. I think it really needs to be a self-sustaining model. And I think the New York Times and Washington Post has demonstrated. Yeah, we may indeed have overpaid. And the reason for that was it was almost an emergent crisis, where if we hadn’t taken over, I believe we would have lost the people in itself, as well as the Washington bureau would have been lost. And it’ll be a tragic, almost irrecoverable loss.

We’re going to invest a significant amount of more money in what I call infrastructure… There’s a whole new technology platform of cloud computing, and internet, and fiber, and streaming, and live streaming, and podcasts, and television over the top — for which, I don’t think the industry has prepared itself. And rightly so, it wasn’t in its industry DNA. That infrastructure, we need to invest in. I’ve invested similarly in that such an infrastructure for our cancer program, in which we have 150 data centers, 200,000 fiber miles moving data terabytes a second, so that we can do artificial intelligence to interrogate the human genome for cancer.

I do not see why I shouldn’t be able to take – and this is going to be an experiment, but — this kind of infrastructure and bring it to the L.A. Times, and what I now call the California Times. Because it means the San Diego Union-Tribune itself can also benefit from this kind of infrastructure. We prepare to invest over $100 million to make that happen. But at the end of the day, the most important thing is the human capital. We need to identify the top talent, the youngest, the brightest. As well as those with incredible experience that have skill sets across all these elements, whether it be podcasting, whether it be short-form videoing, writing good articles, long form, medium form, short form. And most importantly, have a passion for journalistic investigation and integrity.

The number of possible new hires

Soon-Shiong: I don’t know that yet. You know, that’s exactly what we’re doing this week. We’re going through — I don’t even know who is really all there now, since the two years of devastation that the papers had. However, I do know that the people that are remaining there are very talented, committed, dedicated —  the fact that they stayed through this turmoil.

So the best way I think for me to do is to listen and learn, as opposed to being prescriptive. So that’s what we’re doing the next couple of weeks: listening and learning.