Paper Hopes to Clean Up After Loss of Sex Ad Site

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Family-friendly restaurant chain IHOP Corp. earlier this year told its L.A. franchisees to pull their advertising from the LA Weekly and other papers owned by Village Voice Media Group.

That’s because the newspaper company also owned a controversial online classified business called Backpage.com that featured ads for sexual services.

But that decision, and the thinking of other advertisers, could change now that the LA Weekly is being sold in a deal announced last week. A spokesman for Glendale-based IHOP said the company would reconsider its decision, though no immediate plans are in place.

Attracting more advertising will be essential for the future of the LA Weekly, which is hoping it can leave behind the controversy surrounding Backpage.com – a website that was lucrative for the LA Weekly’s parent company but gave more than a dozen papers a black eye when its online classifieds were linked to the trafficking of underage prostitutes.

Scott Tobias, a former chief operating officer at Village Voice Media who led the management buyout, said the LA Weekly’s future will be a continuation of its focus on local journalism and advertising, while rolling out new digital products.

“The LA Weekly is built on local advertising,” Tobias said. “Los Angeles is one of our strongest markets. We take pride in the product and the advertising platform we put out.”

The deal, expected to close at the end of the year, will split up Village Voice Media, and put the LA Weekly and a dozen other free weeklies, including OC Weekly and New York’s Village Voice, under the ownership of Voice Media Group, the Denver-based group led by Tobias.

The previous co-owners, Michael Lacey and Jim Larkin, will continue to own Backpage.com, which brought in $28.9 million of revenue from its online sex ads alone in the past 12 months, according to AIM Group, an Altamonte Springs, Fla., company that tracks classified ad spending.

The sale comes at a tenuous time for the newspaper industry and no less so for the LA Weekly and other free weekly papers. At the LA Weekly, circulation has fallen from 210,000 to 160,000 copies each week since 2005. Meanwhile, the paper has thinned out from about 200 pages 10 years ago to about 100 pages now as advertisers look increasingly online.

Rick Edmonds, a media industry analyst at the Poynter Institute in Tampa, Fla., said there is no doubt alternative weeklies, which tend to offer a local focus and long-form investigative pieces along with entertainment reviews, are suffering like the rest of the newspaper industry.

“That industry is going through pretty tough times in advertising. I think the Backpage.com thing was an exception to that,” he said.

Sex scandal

The LA Weekly launched in 1978 to publish stories not found in mainstream outlets, at the same time other alt weeklies were starting around the country. The papers took off as advertisers sought out its young readership, but part of the papers’ financial success was due to sexually oriented classifieds not accepted by dailies.

Meanwhile, Backpage.com grew out of the classifieds section of the Village Voice, and in recent years became a nationwide online forum for all manner of benign classified listings, such as sports equipment for sale. But it also became the country’s largest marketplace for the posting of sex ads after Craigslist was pressured to remove such listings in 2010.

It didn’t take long for media, politicians and clergy to pounce, especially after New York Times columnist Nicholas Kristof detailed the trafficking of one underage girl in New York with the use of Backpage.com. That prompted some mainstream advertisers to pull their ad spending from Village Voice papers in the past year. Goldman Sachs Group Inc. even sold its position in Backpage.com after the exposé.

However, Tobias said the new ownership will still continue to accept adult-oriented ads in the print editions, including the LA Weekly. Those ads range from advertisements for strip clubs and porn workers to erotic massages and adult escorts. Some verbiage, such as the use of the word “escort,” is regarded as a thinly veiled solicitation for prostitutes. But Tobias said the ads are scrutinized by staff members to ensure legality.

This much is for sure: So-called adult classified ads are prized because they can be sold at a higher rate than comparative classifieds for run-of-the-mill listings. And they are needed more than ever as other advertisements have thinned out.

Marc Cooper, a former writer for the LA Weekly and now a professor at the USC Annenberg School for Communication & Journalism, said he doubts new ownership will reverse the decline of the LA Weekly that he said intensified when Lacey and Larkin took ownership in 2005. The duo had founded another alt weekly publishing group, New Times Media, which included the now-defunct LA New Times.

After they acquired the Village Voice papers, they shut down LA New Times, laid off staff at the LA Weekly and cut its budget to hire freelancers. What’s more, the paper moved from its Hollywood location in 2008 to an off-freeway building in Culver City, which some ex-staffers said diminished the paper’s role as a cultural landmark in Los Angeles.

Cooper said Village Voice ultimately lessened the LA Weekly’s influence in the community.

“The business philosophy was to make the paper as small and pay as little as (they could). It was a cookie-cutter approach that they exported to every paper they owned,” he said.

However, Tobias said the paper is profitable and that he’s been looking to buy it and the dozen other weeklies for some time. He said the plan is to reinvest in first-rate journalism as new digital products are rolled out.

Media analyst Edmonds said beefing up digital offerings makes sense since many people find their nightlife, music and arts information online, bypassing alternative weeklies, which used to be the dominant provider of such listings.

“The (alternative weekly) format has become a little less relevant over time,” he said. “I just don’t know that people need to go there for any of that mix of things.”

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