Sam Zell makes first visit to Newsday

BY DANIEL WAGNER | daniel.wagner@newsday.com

7:39 PM EST, January 15, 2008

Sam Zell, the new chairman and chief executive of one of the nation's largest media companies, strode through Newsday's Melville offices Tuesday with the gregarious efficiency of a political candidate entering the main stretch of an election campaign.

"Hi, I'm Sam," he said to each employee he passed, extending his arm and smiling broadly. And to those who addressed him formally: "I'm not Mr. Zell. Mr. Zell was my father."

It was the 66-year-old's first visit to Newsday since he consummated a deal last month that placed him at the helm of Tribune Co., Newsday's corporate parent. Employees approached him with a mixture of curiosity and excitement -- wondering about the man behind the quirky, jocular e-mails they had been receiving, and relieved to see new leadership atop a corporation that experienced frequent setbacks in recent years.

Bursting into an auditorium overflowing with pressmen, copy editors, reporters and salesmen, Zell gave a speech that -- like his blazing path through the newsroom -- recalled the mantra of change being preached with more vigor than clarity this political season.

"This isn't a dress rehearsal," Zell told the crowd. "Today is the first day of the rest of our lives. ... I just want to create an environment where everyone is open and everyone is challenged."

"I don't think this company has been particularly well run in the past," Zell told the Newsday audience to appreciative applause. One reason for this, he suggested, is that Tribune -- which owns seven major newspapers, 34 television stations and the Chicago Cubs baseball team, among other properties -- has been run as a "media conglomerate" rather than "a conglomerate of media companies."

To that end, the real estate mogul advocated a "bottom-up" corporate structure in which individual employees' ideas and innovation will be fostered for the long-term benefit of the entire organization.

Drawing on comments from Randy Michaels, Tribune's new head of interactive and broadcast operations who was present throughout, he also spoke about the potential for improving revenue through more effective and innovative use of interactive properties.

Zell's subsequent question-and-answer session with employees grew heated early on when unionized workers questioned the company's failure to grant them the same retirement benefit all other Tribune employees will enjoy under the new corporate structure -- and about the termination of Tribune's contribution to their existing retirement accounts.

"I don't know anything about it," Zell said, emphatically pointing his finger at the floor. "The union's role is to protect its members; my job is to protect everybody else, and that's what I'm doing."

"We were surprised to hear that Mr. Zell seemed to separate unionized employees from the rest of our colleagues, since we work just as hard as everyone else in this company and are just as invested in its success," said Zachary Dowdy, a Newsday reporter and vice president of the union's editorial unit. "We respectfully ask Mr. Zell to give unionized employees the same retirement package being offered to the rest of the company and we look forward to working with him toward common goals."

Justin Rocket Silverman, a reporter who had attended a similar session with Zell earlier in the day, said the talk was rousing but gave its audience little to hold on to.

"There was absolutely zero in the way of specifics as far as management or editorial policy or anything like that," said Silverman, who works for am New York, a free daily newspaper that Newsday produces and distributes in New York City. "We're no more informed than we were before."

Still, Silverman allowed that Zell's visit had been galvanizing, saying, "I guess it's kind of reassuring, he's kind of human, really -- in the way that Bloomberg is a human billionaire." Zell ranked 52 on Forbes Magazine's recent list of the world's wealthiest individuals, with a net worth of $6 billion.

Twice during the forum at Newsday's Melville headquarters, Zell repeated that the only difference the deal would make to him was "a couple billion dollars" which he would "just have to deal with giving away."