The Chronicle Chronicles   

Hearst had dreams of creating a world-class newspaper when it bought the San Francisco Chronicle nearly five years ago. Since then the paper has recruited big-time editing firepower, set the pace on coverage of the baseball steroid scandal and snared a Pulitzer. Now it faces serious financial problems as it struggles to forge a consistent identity.
What lies ahead?

When the Hearst Corp. bought the San Francisco Chronicle for $660 million, handing out an extra $66 million to the Fang family to take Hearst's afternoon Examiner, it was investing in a grand vision. "A world-class newspaper" was the phrase used by Hearst executives – who demonstrated their commitment by weathering a lengthy lawsuit challenging the deal and promising to keep all of the employees of both papers.

The new and hefty Chronicle newsroom was brimming with hope after the deed was done November 22, 2000. The paper certainly had the staff, the resources, the lack of a burdensome joint operating agreement, and it was, if you can remember, the dreamy, dollar-filled-days of the dotcom boom. When then-Hearst President Frank A. Bennack Jr. was asked during the lawsuit if he knew how much the company would spend to produce that world-class newspaper, he was clearly envisioning prosperity as well. "No," he answered. "You have to generate increased cash so that you have the resources to do that."

Five years later, the hope is not lost – Frank J. Vega, the new Chronicle's third publisher, says Hearst execs told him they wanted "a world-class newspaper" – but plenty of money has been. As in $62 million last year, an amount confirmed by a Newspaper Guild auditor, and upwards of $250 million since the acquisition. (That's the figure Managing Editor Robert J. Rosenthal says he's heard Vega use. The publisher says through a spokesman that he won't comment on that number.) Hearst's second objective, Vega says, is to "get the place fixed to make some money."

Despite the rather significant deficit, the newsroom has been hanging on to, even fostering, journalistic ambitions that you normally don't see at a paper that missed its fourth quarter projections – let alone one that's dropping millions as if they were pennies. Editor Phil Bronstein brought in Rosenthal as managing editor in October 2002 and Steve Proctor as deputy managing editor a year later, both East Coast transplants with the goal of increasing enterprise projects, narrative storytelling and the general reputation of a place that has long been considered, fairly or not, a low-level newspaper in a high-expectation town.

In the past few years, the 468,739-circulation Chronicle has won a Pulitzer for feature photography for a heart-wrenching series on a severely injured Iraqi boy's recovery in an Oakland, California, hospital; picked up a George Polk Award for an investigation of BALCO, the Bay Area lab charged with distributing steroids to professional athletes, an episode that thrust the drugs-in-baseball problem into the national conversation; created a "homeless" beat that has offered a fresh take on the city's intractable problem; and made a commitment to other long and time-consuming projects. But if some of the stories don't reflect the Chronicle's financial woes, the size of the paper does. It was encouraging---and at the same time puzzling---to see Chronicle bylines from Russia and Israel on the front page of an August A section that totaled a mere eight pages.

Newsroom leaders say they won't pare down their ambitions while the paper tries to climb into the black. "I think we'll be able to continue with our momentum," says Proctor, a former Baltimore Sun editor. The worst case, he says, is that the paper will do a little less than it would like, "but the ambitions don't change."

This picking-your-shots attitude has won the Chronicle praise for some of its undertakings – and criticism for both missing the mark and offering schizophrenic coverage. For the newsroom, at least, it's been a schizophrenic year. There were the highs of winning the Pulitzer, the first for the Chronicle since columnist Herb Caen's in 1996, and the lows of the reluctant ratification of a Guild contract that everyone, even management, describes as horrible.

"This year was a really wonderful year for us," says Stacy Finz, a general assignment reporter, citing the Pulitzer and BALCO coverage. "For it to be the same year as the contract, the same year as the losses..it was just bittersweet." The staff really couldn't even savor that Pulitzer, she says; it "lasted for a flash."

Beyond the money issues is the fundamental question facing every circulation-losing regional newspaper: If it can't be the primary source of news, what should it be? David Moore, a 32-year Chronicle veteran and soft-spoken copy editor, sums it up nicely: "Because of all the competition, we're trying to do as many stories as we can that people can't get anywhere else." The problem with that, he adds, is what about the important news that every other source is going to have? And are those unique stories the ones that people want to read? "I'm not sure."

The paper is taking risks, with the stories it chooses, the way it plays them, even the design of the front page.

John McManus, director of GradeTheNews.org, an organization that critiques Bay Area media, says some of the paper's work has been laudable, while other efforts have been inadequate. Nevertheless, he says, in the past three years – since Rosenthal joined the paper – the Chronicle has stabilized and improved. "It would be a tragedy if, just as they're showing signs of promise, if they were to pull in their horns and retreat to where they were in the '70s and '80s... San Francisco deserves a great paper and it's beginning to get it, and it would be a tragedy if it doesn't succeed."

Newsrooms have been arguing for years that papers need to improve the journalism in order to improve the bottom line – but rarely do their corporate bosses believe in investing their way out of a bad financial situation. Cutbacks are the rule. And Hearst's mammoth losses in such a wealthy, educated, literate market have left almost everyone interviewed for this story baffled, particularly the staff. "What the future holds, given how Hearst has managed to lose money in such a market, doesn't inspire confidence," McManus says. Just what is the San Francisco Chronicle – is it a paper on the path to greatness? More important, can it upgrade its journalism while shrinking its deficit?

No mere bystander to newsroom money machinations, Rosenthal is a glass-half-full guy these days. He moved to San Francisco after coming out on the losing end of budget battles with parent Knight Ridder when he was editor of the Philadelphia Inquirer, and he talks about the difference between a privately held company, as Hearst is, and a publicly traded one, citing the encouragement of, and lack of meddling in, journalism as a big difference. The money problems at the Chronicle haven't dampened his enthusiasm for the paper. "If I hadn't gone through that in Philadelphia, I probably wouldn't be sanguine about it," he says. But it's different here: "We're building something..and Hearst wants to build something." In Philadelphia, "it was about taking it apart."

As with any newsroom, the Chronicle is full of the optimists, the pessimists, the disgruntled, the blissful, the frustrated and the afraid. But if there's one blanket adjective to describe staffers, it's "mystified."

I mean, they'll say, how can a major daily newspaper not make it in the upscale Bay Area? And what does that mean, they ask, not just for their own futures, but for the rest of the newspaper industry?

But the sticky financial situation is a decades-old story, dating back to a fateful joint operating agreement, a pact forged in 1965 by Hearst's Examiner and the de Young family's Chronicle. The companies merged their business operations while maintaining separate and competing editorial staffs. For 35 years, profits from the two dailies were split 50-50, putting a damper on whatever cash flow the much larger morning Chronicle may have enjoyed without a continuously shrinking afternoon daily cutting into the revenue.

There was always a feeling among the old Chronicle's news staff that the family-owned paper was doing quite well but the owners were tightfisted, says Matt Wilson, the Chronicle's executive editor in the late '90s. In fact, he says, "it was kind of right on the edge all the time," either losing or making money but never in massive quantities. After John Sias, a former Capital Cities/ABC executive, came on board in 1993 as president and CEO, he called the Chronicle "a nonperforming asset."

In any 50-50 JOA, there's little incentive for either side to invest substantially in the journalism when no matter what is put in, an owner only gets 50 cents of every dollar that comes out. Yet both parties were reluctant to cut down on anything, particularly as an end to the JOA grew closer (it was to expire this year) and the papers prepared for the day when San Francisco would have either a sole survivor or two papers fighting to stay alive.

"The issue was neither party wanted to give in on anything that they felt they might need in the event they had to compete head to head in 2005," says Steven Falk, Vega's predecessor as Chronicle publisher. So the cost structure was high, says Falk, who also worked for the San Francisco Newspaper Agency, which oversaw the JOA, from 1987 until 2000, ultimately as its CEO and president. At the end of 1999, he says, the Examiner, a 100,000-circulation paper, was still delivering papers to homes in Redding, California. That's 217 miles north of San Francisco.

Falk says there wasn't investment in technology near the end of the JOA either, because neither owner wanted to spend money on capital investments that couldn't be easily divided in half if both papers survived. In 2004, Falk says, the Chronicle was the last large newspaper in the country to convert to pagination, which other dailies had long found to be a more efficient and economical way of putting out a paper.

Then there was the Sunday edition, a hybrid of news sections from the Examiner and features from the Chronicle. Jerry Roberts, the Chronicle's managing editor from 1997 to 2002, says Sunday was a frustration, because "the people who got the Sunday paper were Chronicle readers..they would read one paper six days a week, and they would basically read another paper that was very San Francisco-centric" on Sundays. Historically, the majority of Chronicle readers have resided outside of the city.

Falk says this was a major money issue as well. While the Sunday circulation was larger than the Chronicle's daily circulation, the gap wasn't as grand as it is for other major metropolitan dailies. (Sunday circulation, now 510,844, has decreased since the staffs merged.) "So while we could charge a small premium for Sunday" advertising, Falk says, "it wasn't anything like you see at the Chicago Tribune, Washington Post, Boston Globe. Sunday has to be the lead day not just in readership but in revenue." (Newspaper consultant and AJR columnist John Morton says typically Sunday makes up 40 to 50 percent of a paper's ad revenue.)

From that starting point, Hearst merged the two staffs of the papers, guaranteeing jobs for everyone – not just reporters and editors, but two sets of press operators, advertising salespeople, truck drivers. There were no immediate layoffs. And before long, that dotcom boom, which brought in plenty of ad revenue, went bust.

Wilson, now executive editor of the Marin Independent Journal outside San Francisco, isn't surprised that this trifecta – the high cost structure, plus advertising shortfalls, plus the hangover from an inefficient newspaper agency – has added up to $60 million in annual losses. "It was a train wreck that you could see coming."

To manage this vexing situation, Hearst has turned to three publishers in less than five years. First up was John Oppedahl, former publisher of the Arizona Republic, who presided over the merger of the staffs post-sale. In March 2003, Falk stepped in. In his two-year stint, Falk says he pursued a strategy of cost-cutting – reducing the newspaper's staff by about 400 full-time equivalents – and of revenue growth, by launching a direct marketing program and new products such as the nation's first-and-only Wine section. (One insider says that advertising-success-of-a-section has brought in almost $2 million a year. Vega says this year the Wine section revenues are up 38 percent from 2004.)

Falk also put a full-time national advertising director in New York to help convince Madison Avenue that San Francisco should be among agencies' top buys for national advertising. "I was on a mission to make the Chronicle more than just another regional newspaper, to really put it on the map in terms of national advertising."

Those initiatives, Falk says, were reaping rewards, "but all of that was against the backdrop of a continuing baseline advertising depression in Northern California." The losses continued.

Falk left abruptly in late December 2004, and Hearst brought in Frank Vega, a man who earned his ominous nickname, "Darth Vega," while putting an end to the Detroit papers' 20-month strike in 1997. After 14 years as president and CEO of Detroit Newspapers, the agency that runs the business side for both the Free Press and the News, Vega took the titles of publisher and CEO of the Chronicle in January.

In discussing how the paper got itself into its depressing financial predicament, Vega cites the inflated cost of doing business in San Francisco; the high cost structure, including labor expenditures, at the paper; and the competitive market. He talks about "strengthening the core product"; creating editorial initiatives that use the paper's content in new ways (Deputy Editor Narda Zacchino, for instance, is working on Chronicle book development); and getting more profit from sfgate.com, the paper's Web site, which regularly ranks as the fourth or fifth most visited newspaper site. The Gate's story selection and feel differ dramatically from the paper's, and the Chronicle may have been the first major newspaper to offer podcasts.

Vega's first initiative to trim spending was to secure passage of the major union contract, which affects nearly 900 editorial, advertising, circulation and accounting employees. In late July, Guild members, faced with a take-it-or-get-something-much-worse edict, ratified an agreement that took away a week's vacation (from a maximum of five weeks a year), cut sick days to five a year, abolished car allowances, instituted pay cuts (mostly for workers outside the newsroom) and barred members from honoring the picket lines of other unions, among other concessions. For Guild members, this was a big step backward. But a Guild auditor confirmed that the paper had lost close to $62 million in 2004, and, as Guild President and transportation reporter Michael Cabanatuan says, "Frankly, I think a strike would've killed this newspaper."

Cabanatuan says negotiations came to an abrupt halt when management presented its final offer. He says the Guild was told by company negotiators that Hearst, including members of the board of directors, was growing increasingly impatient. There was "some sentiment that [Hearst needed] to get this wrapped up or make a decision on whether to sell the paper," Cabanatuan says. (After numerous phone calls and e-mails to Hearst Corp. offices, George B. Irish, president of Hearst Newspapers, declined to be interviewed for this story, saying through a spokesman that he felt he had little to add, given my conversations with Vega and others at the paper.)

Management offered 120 buyouts across departments. Cabanatuan says the paper's management was expecting about $6 million in savings from the already signed contract and a total of $30 million in concessions from all the unions. (Three more contracts were still being negotiated at press time.)

Vega won't confirm hard numbers – "we don't really release specific information of individual papers, what they make, what they don't make," he said, even when asked about the widely reported $62 million. But he will say that he's "not looking for our employees to put us in the black." As for advertising, the ad guy in New York is gone – he's now at the L.A. Times. Vega said through spokesman Allen Olivo that the New York position was a three-month experiment; Vega and others decided that, since the paper uses a national firm in New York, they'd rather have the Chronicle's national advertising person in San Francisco.

The money woes put the Chronicle in an unusual situation. It's "almost unheard of for a major metro daily that doesn't have a [direct] competitor not to make money," says John Morton. (Against the odds, the Examiner still exists – but not as a major metro rival. The free paper is owned by Denver businessman Philip Anschutz; the Fang family gave it up soon after Hearst's subsidies ended.)

Still, Morton – and many others – thinks the Chronicle will turn a profit. It might not be a 20 percent margin, he says, but "they'll ultimately wind up making money."

Vega notes that "there are a lot of papers in this country that have our revenue base that make money. So we have a very high cost structure here... A lot of papers that bring in a hell of a lot less revenue than we do..make money. So there's no question in my mind that the things here..are fixable."

The question on everyone's mind: What kind of paper will that be?

Shortly after Phil Bronstein, who had been editor of Hearst's Examiner, got the top newsroom job at the merged Chronicle, he had dinner in Monterey with John S. Carroll, then new to his editorship at the Los Angeles Times. Carroll "said at the time, 'You may have greater challenges, but your upside is greater,'" Bronstein recalls. "His view at L.A. was, you know, he had this huge battleship, and it would just take him forever to turn it around. Well, it didn't take him forever." (Carroll's paper won 13 Pulitzers in his five years there before he stepped down in August – see The Beat, August/September.)

"And it turns out this has been slower," Bronstein continues. "But I still think the upside is huge, given where we are."

In 2000, the hopeful Chronicle had about 575 staffers in its newsroom – today, the roster is down to about 440, mostly through attrition. The merger shakeout has been slow and difficult. The duplication, with two of virtually every type of reporter and editor in the newsroom, meant many people were underused or lost. It "felt like we were treading water for a year..trying to stay afloat," says Heidi Benson, the paper's publishing reporter. There are still people trying to find their places, adds pop culture critic Peter Hartlaub.

I had lunch with Benson, Hartlaub and Steven Winn, arts and culture critic, three staffers who have found their places – and are quite happy in what they call a more "writerly" features department, thanks to the April 2003 arrival of Carolyn White, deputy managing editor/features. (Weeks after that lunch, White left to take an editing job at National Geographic.) But they remember traveling a long road to get there. "It was baffling," says Winn of the amount of time that passed before management held a big meeting with flow charts to reassign some of the staff. "It was 15 months when I shared the theater beat... I said, 'Well, how are they affording this?'... I was underemployed."

Not that any merger is quick, smooth and painless, but it's easy to see that Bronstein's paper has been a bit of a battleship itself, particularly in those early days.

Before the merger, the Chronicle had launched a big push into the suburbs, an effort to take on Knight Ridder's San Jose Mercury News and Contra Costa Times, William Dean Singleton's ANG Newspapers and other competitors. That strategy "pretty much came to a screeching halt" after the merger, says Linda Strean, a former Chronicle editor who was deputy managing editor after the sale. "Those of us who were there then viewed it as an unfinished initiative," she says, while the new people saw it as a failure.

The five-day-a-week zoning was cut back to one day. Bronstein says he felt the zoning "was more fig-leaf coverage than real coverage." The paper added a page to the Bay Area section, he says, so there is more paper-wide newshole for regional stories. But there has since been a push into the East Bay, with staffers added to the Contra Costa bureau, and the start of East Bay Friday, a zoned features section.

The post-merger duplication applied not only to beats but to editors as well. Strean, Wilson and Roberts, top editors at the old Chronicle, worked under Bronstein, their former competitor, after the merger. (All three have since left the paper.) The disagreements at the top were evident to the staff. "The leadership was then figuring out what to do and who to be and fighting their own fights," says Kim Severson, a writer in the food section who left in October 2004 for a job at the New York Times. When "all that noise is going on above you, it's hard to do great journalism."

Roberts, now editor and vice president for news of the Santa Barbara News-Press in Southern California, departed in February 2002. Strean left later, worked under Roberts at the News-Press for a time and is now managing editor of GreatSchools.net, a nonprofit site aimed at parents of kids in kindergarten through 12th grade.

With the old Chronicle management gone, Bronstein looked outside the paper for his managing editor, hiring Robert J. Rosenthal – "Rosey" to everyone. Severson says there was a lot of hope that he would bring a new direction, a fresh start, gravitas. "People were generally welcoming and thinking..finally things would turn," she says. There was always a feeling of, "OK, maybe now, maybe now the merger will be behind us. Maybe now."

Rosenthal says he didn't realize how big a challenge he was accepting when he came to San Francisco. But even with the problems and the looming buyouts, there's a sense that the paper is taking steps to "renew the place," he says. He talks of changing the culture, which to Rosenthal means giving reporters time – "as long as it takes" is his mantra – to work on enterprise and big narrative projects, devoting large swaths of newshole to them and fostering a sense of urgency.

Perhaps things haven't "turned" but "are turning." Kevin Fagan, a 12-year veteran of the Chronicle, is the one who got the homeless beat – it was Rosenthal's idea, a non-San Franciscan's reaction to the shocking scenes on the city's streets. Rosenthal tells the story of sitting in a car at a stoplight with his wife and children when a homeless man, surrounded by pigeons, snapped the neck of one of the birds and stuffed it in his jacket.

Fagan and photographer Brant Ward spent six or seven months working on their first series. Fagan initially thought he'd "go be homeless for a week" to cover the story. But, Fagan recalls, "Rosey said, 'You two guys just go out and be on the streets for as long as it takes – and nothing else.'"

Rosenthal also backed Fagan's longtime scheme to go to Laos to follow a local peace activist who developed a computer that could be hooked up in remote villages. "Rosey got the adventure," he says. The editor worked closely with Fagan on his writing, phoning in single word changes from a plane the day the first installment of the homeless series ran. "You become a Rosey convert when you go through that," Fagan says. "Those who haven't..they don't know what to make of him."

There are certainly plenty of critics of some of the news decisions and high-profile initiatives. While the paper is picking its shots, not everything pays off. Investigative reporters Mark Fainaru-Wada and Lance Williams have been covering the BALCO/steroids story almost full time since September 2003, garnering several awards for their efforts; the "Operation Lion Heart" series on the Iraqi boy whose family eventually was granted political asylum in the United States, by writer Meredith May and photographer Deanne Fitzmaurice, picked up the Pulitzer. But then there was the 39-part series on the making of a bottle of wine called, simply, "Grape." Outgoing Deputy Managing Editor/Features White, a former editor at the Philadelphia Inquirer, says "Grape" was a great read, but many inside and outside the paper thought it was a bit much, as in too much, to the point where the concept has become a bit of joke. At a front-page meeting I attended, one editor told of the next day's Wine section centerpiece story, a saga of infidelity, divorce and loss in a vineyard. "Let's do a 39-part series on it," one editor quipped. "Cheap shot," said another.

Then there was the sex beat, a decision to cover the Bay Area's seedy sex industry, but the plug was pulled on that project after about 10 installments. The pieces offered an inside, sometimes shocking look at things like the world of bondage and S&M – not your typical mainstream newspaper fare, a bit voyeuristic, and without the context to explain why the paper was doing this. "It didn't work out," Rosenthal admits, adding that the paper may try it again.

Mark Morford's popular online column, written in a style that is, well, very blog and not very newspapery, now runs in the paper. Actually, it's an edited, PG-rated version of Morford's work, which has been provocative enough in the past to get him suspended. Twice.

These stabs at being different are either seen as wacky acts of desperation by a paper clinging to life by a thread or grand forays into experimentation. Steve Proctor says of Grape: "There's something that's daring and almost crazy... But to me, that's more emblematic of being willing to take risks." The paper's never going to get anywhere, he says, unless it tries.

Proctor spent 23 years at the Baltimore Sun, lastly as deputy managing editor of features and sports, and he says he came to San Francisco because it didn't seem that the Sun, under owner Tribune Co., was going to get the kind of support it needed to develop and expand its journalism the way it had in the past. Tribune's strategy, he says, revolved around the L.A. Times, the Chicago Tribune and Newsday – leaving the Sun in the second tier. At the Chronicle, Proctor, like Rosenthal, sees the job as building something, turning a newspaper that has been viewed as underperforming "into a newspaper you would expect a sophisticated city like San Francisco to have."

He describes the process as "alternately exhilarating and exasperating."

As for where the Chronicle is, none of the top editors is declaring victory – yet. "On a scale of one to 10, we're about three-and-a-half at the moment," says Bronstein, who adds that that rating is good, because "relative to the things we're talking about here, we started probably minus five... I think we've made a lot of progress and obviously we have a lot to go."

To see that the Chronicle is taking chances and daring to be different, one only had to pick up the paper this summer and look at the front page. One day, the design gave equal weight to three headlines, presented in three columns across the front page. Another day, the headline "Bay Area's New Efforts in the War on Terror" was laid out partly in red type and in large capital letters. Most days, A1 features only four stories.

The effort to mix it up a bit, to make the paper more vibrant, was launched by Bronstein and Rosenthal, both of whom say some days they like the results, some days they don't.

But it's something those inside and outside the paper point to when they say the Chronicle is uneven and unpredictable. "Our front pages change so much," reporter Stacy Finz says, "I don't even know what to expect anymore."

Deputy Editor Narda Zacchino, who came to the paper in May 2001 after 31 years at the Los Angeles Times, says she's a little on the conservative side – "early on, they were sometimes a little tabloidy" she says of the front pages – but overall she likes them. "I think they've really hit a stride now."

"Um," says former Chronicle editor Linda Strean, when asked about the new design. She pauses. "It's loud." Back when she was at the afternoon Examiner, she says, the paper clearly had a street-sales look, and this is "definitely more reminiscent of the old Examiner."

Rosenthal says increased street sales would be a bonus but isn't the goal of the new design. Bronstein – obviously one with single-copy sales experience from his Examiner days – says street sales did not dip in the summer, a good indicator that they could be up this fall. Circulation, which dropped 6.5 percent daily and 7.8 percent on Sunday in the six months ending March 31, is always a concern – even though Bronstein and Vega say the majority of that decrease was the result of discontinuing deeply discounted copies.

The front pages and other news decisions have led some staffers to question the mission of today's Chronicle. Reporter Carl Nolte, who has been with the paper since 1961, says it lacks direction. Newsroom resources "need to be reshuffled and rethought," he says. "Seems to me," he adds, "we look like some fish on the bank, flopping around... We've been doing some pretty interesting things, but the sum total isn't making an impact on readers."

David Perlman, a science editor and writer who has been at the paper even longer than Nolte (since 1951), says the Chronicle is "doing some pretty damn good and interesting things we would've never done before. I'm doing more travel on more stories than I would've done before Hearst took over." But, he adds, not all of what the paper does "makes as much sense as it should."

For almost every project, it's easy to find both fans and naysayers. After Chronicle copy editor Alicia R. Parlette, 23, found out she had cancer, the paper ran seven "chapters" of "Alicia's Story," her first-person account of what she was going through. While 3,000 letters and e-mails poured in, the vast majority thanking the paper for running a touching story that resonated with many, others questioned the amount of space and the type of play the pieces received. Those first seven installments in June – two more have run since then – appeared on consecutive days on A1, and a few layouts have taken up more than half of the front page.

John McManus of GradeTheNews.org says it was "day after day after day of her personal struggle on the front page... It just seems like a kind of personal journalism that may be good for a diary" but not for a major metro paper, particularly when it displaces so much on the front page. (Rosenthal says the story received a lot of emphasis, "but we're saying it's totally different. [You're] not going to see this anywhere else.")

The Chronicle tends to play all of its major initiatives big, and almost always on the front page. This summer, the paper sent Matthew B. Stannard to the Middle East to write about the evacuation of Jewish settlers from the Gaza Strip and the West Bank through the viewpoints of various individuals. Between mid-July and late August, Stannard filed 22 human-interest pieces. Seventeen of them ran on A1.

With only four pieces on the front page, the paper's choices are often the subject of vigorous debate. "People expect the Chronicle to be a civic institution that's going to tell them what's important, and they don't always live up to that," says Michael Stoll, associate director of GradeTheNews.org. At times, he says, the paper features "storytelling with nothing else," a can't-see-the-forest-for-the-trees problem in which the pieces are nice tales but don't address broader, big-picture issues.

Chronicle staffers are often hard-pressed to pinpoint how the paper's substantial deficit has affected the journalism. "Newshole" is usually the answer, and maybe fewer expense account lunches. They're surprised at how much the paper has continued to do despite the financial morass. Perhaps "unevenness" is the true indicator of a paper trying to find its way, hang on to big ambitions and do it all with fewer resources.

Rosenthal says complaints about unpredictability or unevenness are fair. Part of the problem is that the paper doesn't have staffing in the right places to provide consistent coverage. (Some staff reorganization is likely to follow the buyouts, which were being implemented at AJR's press time.) There are staff-produced stories from Gaza now, he says, but the Chronicle won't be there all the time. While the paper relies on the Chronicle Foreign Service – a network of stringers – Rosenthal says foreign bureaus may be in the paper's future. Right now, though, "the number one challenge is to really tell people things about the Bay Area and California they didn't know," he says.

Some, like Readers' Representative Dick Rogers, say the paper is still struggling to reflect that sense of place. Larry Kramer, a former executive editor of the Examiner, a Bay Area resident and president of CBS Digital Media, says the Chronicle has demonstrated "a stronger and more consistent commitment to investigative journalism... Where I think it still falls down a little is in capturing what is unique about San Francisco." Of course, Kramer says, that's the easiest thing to ask for and the hardest thing to do.

"They're trying to build a reputation around the country of a great newspaper" – an honorable ambition, he says. "I think, though, the ambition ought to be more about this city."

Bronstein does talk about such an ambition when describing how the Chronicle hopes to become that great paper, the one envisioned five years ago by Hearst. He runs through the cultural phenomena that have sprung up in the Bay Area and moved across the country, from the Beat Generation of the '50s to the summer of love in the '60s to the digital revolution. The Chronicle, he says, needs to find a way to reflect the rich mixture of people and culture and innovation. "The way you do that," Bronstein says, is not just with great traditional journalism "but also things like [Don] Asmussen," who pens a satirical cartoon for the paper, "or even putting Sean Penn as a correspondent in the paper or even Robin Williams in the paper, because these are people who live here." In late August, the Chronicle ran Penn's dispatches from Iran, which he visited in June, before the country's presidential elections.

Few at the paper are using the adjective "world-class" these days – the financial situation seems challenging enough, perhaps – but the ambition is still there.

"It's nice when The Atlantic Monthly starts a story by saying, you know, in an influential article in the San Francisco Chronicle," Bronstein says. "It may seem that we're coming from a place of insecurity and inferiority complex, but the reality is that..the Chronicle has not historically, whether rightly or wrongly, been taken very seriously as a newspaper. And it is our intention to change that."