Walter Hussman Jr., chairman of Wehco Media Inc., in his office at the Arkansas Democrat-Gazette.
Walter Hussman Jr. was born into a family of newspaper publishers, but he’s one business icon who didn’t truly want to be a businessman.
“I really thought the creative side was the news side, writing the journalism,” said Hussman, longtime publisher of the Arkansas Democrat-Gazette and chairman of Wehco Media Inc.
So after getting a journalism degree at the University of North Carolina and an MBA at Columbia, Hussman went to work in 1970 as a writer at Forbes magazine in New York. Then his father gave him a choice. He could stick with writing, or he could come home and learn the family business. The logic was simple: If he tried publishing for a few years and didn’t like it, Hussman could return to the writing life in New York. If he didn’t try it, he would lose the opportunity forever, because the aging Hussman would sell the business and retire.
“I was enjoying being in New York and really not wanting to come back,” Hussman said last month. “The idea of moving from New York to Camden, Arkansas, when I was 23 and single wasn’t really so appealing. But I’m glad I came back.”
His first task was to manage his hometown paper, the Camden News, which his father had bought from his grandfather, Clyde E. Palmer, in 1949. One priority was printing problems, and an idea struck: Why not have the afternoon Camden paper printed on the Hussmans’ modern offset press in El Dorado? The El Dorado News-Times was a morning paper, so the timing would allow it to handle both jobs. Shared printing between sister publications has since become an industry standard.
After a few more ideas like that, Hussman found that he was having fun. “I started to realize how interesting it was to use creativity in business decision-making.”
Almost a half-century, a newspaper war and an internet revolution later, Hussman is in the Arkansas Business Hall of Fame, but at age 69 he is pulling back a bit. Wehco President Nat Lea, a nephew of his wife, Ben, has succeeded him as chief executive. Hussman’s daughter Eliza Gaines, 29, is vice president of audience development.
Hussman, thin but energetic as ever, his foot tapping against a table leg throughout an hourlong interview, clearly loves the Democrat-Gazette. (It was the Arkansas Democrat when he and his father bought it for $3.7 million in 1974.) As chairman of Wehco, he oversees 2,000 employees and operates 14 daily and 11 weekly newspapers as well as 13 cable TV companies. The private company has operations in Arkansas, Tennessee, Texas, Missouri, Mississippi and Oklahoma.
“Eliza makes it four generations of the family in journalism, and actually Nat is a part of that too,” Hussman said. “He’s done a great job at the corporate level, and in jobs at our cable operations, and managing the papers in El Dorado and in Hot Springs.”
Hussman recounted Eliza’s success as a travel writer in San Francisco, as editor of two Wehco papers and in several roles at the Democrat-Gazette. He said it was her idea to have reporters promote their work on Twitter and Facebook, something that helped drive web page views up by 50 percent in a year.
But with readership and ad revenue shrinking in the internet age, Gaines is wading into problems as existential as those her father faced at the Democrat 42 years ago. Then it was the money-losing No. 2 paper in Little Rock, trailing the Arkansas Gazette in circulation, advertising, news and prestige. As losses persisted, Hussman despaired. “Buying the Democrat was a long shot, we knew, at the time,” he said.
“Walter tried to give up,” said longtime friend and lawyer Philip Anderson. “He offered a joint operating agreement, willing to publish five days a week, and to guarantee that the Gazette would get its historical profit. After that, there would be a 90-10 split, with the Gazette getting the 90 percent. [Gazette Publisher] Hugh Patterson said no, and that just made Walter more determined. Walter worked very hard to keep that newspaper going.”
He did it with a flurry of innovations like free want ads for individuals, front-porch delivery and marketing — not to mention more pages of news and a fiery editor named John Robert Starr — changes that made the Democrat competitive and eventually drove Patterson to file an antitrust suit claiming unfair business practices.
After the Democrat prevailed in a unanimous federal jury decision in 1986, the Gazette was soon sold to the Gannett Corp. for $51 million and $9 million in assumed debt.
Gannett entered the Little Rock market boasting of its deep pockets and goal of driving the Democrat into submission. But after five years of bitter competition and deep red ink (Hussman has conceded losing “tens of millions”; Gannett lost $108 million in Little Rock), the chain looked to its bottom line, shut down the Gazette and sold its assets to Hussman for $68.5 million.
“Then we had some very good years,” Hussman said. (Wehco saved enough cash over four years to buy out Hussman’s sister, Marilyn, who owned 40 percent of the company.)
But the Democrat-Gazette eventually faced the digital onslaught, in which advertising migrated to the internet and most newspapers rapidly lost paying readers.
Again, Hussman showed foresight, his admirers say, by keeping the Democrat-Gazette’s news content largely behind a pay wall.
In retrospect, protecting web content was crucial. “By 2011, we had the same circulation we had 10 years earlier, and we were the only paper in the country that could say that,” Hussman said. “Dallas had lost half of its circulation; Atlanta the same. Then it became clear that advertising was so bleak we would have to get far more of our revenue from subscribers. When we raised rates, we lost some, but we lost from a base of 100 percent of our customers. When others had to raise prices, they were working from a base of half.”
Recent whispers that Warren Buffett made an play to buy the Democrat-Gazette or Wehco aren’t true, Hussman said in a July 25 email.
Buffett had praised Hussman’s operation three years ago as an example of how profits still could be made in newspapering. At that time, Buffett’s Berkshire Hathaway was snapping up papers, and even today he doesn’t rule out more acquisitions, though his enthusiasm has cooled.
“This rumor got started when he [Buffett] contacted me a few years ago and asked me some questions about why we did not give away our content,” Hussman said. “He also asked about how we competed and ultimately were the survivor of the newspaper competition in Little Rock. He invited me to Omaha for lunch, and I later attended the annual meeting the year he mentioned us in his annual letter to shareholders. We have stayed in touch since then. But he has never once asked about acquiring our paper or newspapers. And we are not interested in selling them.”
While Hussman has been criticized as anti-union (the Democrat’s locals all decertified in the first few years of Wehco ownership) and frugal to a fault, particularly in payroll, the Democrat-Gazette did splurge a bit after the 1991 merger.
Hussman has drawn praise for supporting charter schools and the P.A.R.K. after-school program led by former pro football player Keith Jackson. The eStem charter school downtown occupies the Gazette Building, which Wehco sold for $3 million and unamortized lease improvements after refurbishing it at a cost to the company of $2.5 million, Hussman said. “Jim Walton [chairman and CEO of Arvest Bank Group] put in another $2.5 million,” he said.
Jackson, the Little Rock native who became an all-pro tight end, said Hussman was instrumental in helping his ministry for inner-city youths. “When it comes to education, Walter Hussman is probably the No. 1 guy in Arkansas behind the scenes,” he said. “As big as his mind is for business, his kindness is bigger than that.”
Wehco’s revenue is stagnant these days, though figures for the company are unavailable, and Hussman avoids specifics. “Newspaper revenue has been falling, but cable has gone up a bit. We focus on being more efficient. The Democrat-Gazette itself is still profitable, though not nearly as it once was. The fact that it’s making money is encouraging in this environment.”
In 2001, Arkansas Business estimated the Hussman family net worth at $890 million. What is it today?
“Whatever my net worth is today, it’s a lot less than it used to be.” He laughed, long and hearty. “I’ll put it this way, the value of newspapers has gone down significantly. But I still enjoy it as much as I ever did.”
See more at Ten Arkansas Business Icons Have Stories to Tell
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