Los Angeles Times editor's departure shows that billionaires — still — have a hard time figuring out how to save newspapers

• Another billionaire is having a hard time with his newspaper.
• This time, it's Los Angeles Times owner Patrick Soon-Shiong, whose editor is leaving.
• Jeff Bezos's Washington Post made big cuts — and Warren Buffett has given up on papers altogether.

It's not news that the newspaper industry is in trouble: It has been in trouble since at least the start of the internet era.

But Tuesday's news — that Kevin Merida, the top editor at the Los Angeles Times, is leaving the paper less than three years after taking the job — illustrates, yet again, just how lousy the situation is.

That's because the LA Times is owned by billionaire Patrick Soon-Shiong, and it is losing money; even though Soon-Shiong is a billionaire, even billionaires have limits.

You can get some of that information by reading between the lines of Soon-Shiong's memo to his staff announcing Merida's departure. It includes multiple references to the paper's "challenges" and a line about how it's "imperative we all work together to build a sustainable business."

But a person who is familiar with the company made it even clearer to me Tuesday: The LA Times, which already underwent significant layoffs last year, is now looking at another round of cost-cutting this year — something designed to cut more than $10 million from its budget, this person said.

It's reasonable to conclude that Merida didn't want to take that on, so Soon-Shiong will have to find someone who does.

Asked for comment, an LA Times spokesperson said that company leaders "don't generally make forward-looking statements about staffing levels and aren't able to comment further at this time."

It's also worth pointing out that Soon-Shiong, who bought the LAT and the San Diego Union-Tribune for $500 million in 2018, sold the San Diego paper last year. In 2021, The Wall Street Journal reported that Soon-Shiong was considering selling the LA Times itself, but Soon-Shiong said that was not the case.

The bigger picture is that Soon-Shiong is just the latest billionaire to have bought a newspaper — a business that in the old days could generate profit, prestige, and power for its owner — and determined that even a billionaire doesn't have the ability or will to fund perpetual losses.

Last fall, for instance, The Washington Post — owned by Amazon founder Jeff Bezos — one of the richest men in the world — underwent giant staff cuts. In 2020, Warren Buffett — also one of the richest men in the world — sold Berkshire Hathaway's portfolio of newspapers, including his beloved hometown Omaha World-Herald.

Meanwhile, one of the few investors that wants to own newspapers — hedge fund Alden Global Capital — has a reputation for buying the properties only to strip them of their value.

So, if billionaires can't save newspapers, who can?

There are some promising plans for nonprofit publications kept afloat by a combination of ads, subscriptions, and local philanthropy — The Texas Tribune is the best-known example. But, of course, the Tribune itself had layoffs last year.