Truth seeker

Dow Jones leader Peter Kann talks about the fascinating business of covering business.

By: George Frey

Staff photos by Mark Czajkowski

Peter kann, CEO of Dow Jones, chats with PBJ about his career and the challenges of reporting on the business scene.

   International bureaus, some 1,500 reporters, $1.6 billion in revenues and world influence don’t readily come to mind in the presence of Peter Kann. His friendliness and patience make it easy to forget he’s the man at the helm of Dow Jones & Co.
   As CEO of Dow Jones, Mr. Kann is responsible for the institution millions of people rely on for their up- to-the-minute news every day through the company’s products, such as its flagship newspaper, The Wall Street Journal, its online version of the Journal and Dow Jones Newswires.
   Mr. Kann talked about his career path, the business of Dow Jones as a company, business in America and journalism in society.
   "I’m a big believer in the truth," the Princeton resident said as he sat rocking his chair from time to time in his South Brunswick office, often looking out a window at the snow and traffic on Route 1 while freely talking about the company. There is a white dry-erase blackboard in the background, once scribbled with the remains of notes and phone numbers; his tie is loosened; occasionally, he chews on gum.
   "When I was a young reporter, there was a mindset in the country that everything is relative. The truth is in the eye of the beholder. The moral relativism that is pervasive in society is a contradiction to what journalism is. We have to aspire to find and collect the real truth.
   "The end result, though, is that it is not equally valid for everyone. One man’s freedom fighter is another man’s terrorist.
   "It is important that we get the real truth and facts one by one by one. At least that’s the way I happen to behold it."
   By the fifth grade, Mr. Kann knew he wanted to become a journalist. He grew up in Princeton, and went to Princeton High.
   "If you like to write and have a natural curiosity and a short attention span… then journalism could be right for you," he joked. "My father was a historian so I would watch him take years to write a book," Mr. Kann said. "It seemed impossible to me. I thought, ‘If I can get my name on a newspaper article within a couple of hours and then move on to the next one, that would be perfect.’"
   The newspaper that gave Mr. Kann his start was this one, The Princeton Packet, where at the age of 16 Mr. Kann did a lot of what there was to do at a local newspaper — from getting the bowling league scores from an old Nassau Street bowling alley to filling in for the society page editors when they were out.
   "The next day you’d be driving around in the old company station wagon, picking up the newsstand returns."
   Beyond seeing all sides of the paper, he said, the great thing about it was that the publisher and owner really stood up for the reporters, as sometimes reporters get threatened by people angry with the stories they write.

  "The greatest piece that I ever wrote for The Packet was an exposé on migrant laborers that used to work on farms in the area," he said. "It showed how grim some of the conditions were for these people; living in shacks without running water or electricity.
   "A lot of people were upset with it and complained to the publisher about the story," Mr. Kann said. "The publisher was even friends with some of the people that complained. They stood by me, though."
   The publisher and owner of The Packet at that time was Bernard Kilgore, who during the same time also held top positions at Dow Jones, retiring in 1966 as its president. He was then named chairman of the Dow Jones board. Today, Mr. Kilgore’s son Jim runs The Princeton Packet Inc. as the president and publisher.
   "A lot of people at the time said Barney bought The Packet as a hobby," Mr. Kann said. "I think he saw it as more of an experiment."
   Bernard Kilgore is credited with boosting The Wall Street Journal’s slumping circulation figures, partly by making the Journal the first national daily in the country through satellite technology and remote printing facilities.
   Another insight Bernard Kilgore had that changed the company came about through realizing it was important for Dow Jones and The Wall Street Journal to devote more time to the analysis of stories. Readers would choose the Journal over other local and national daily papers because of its depth in showing readers why an event happened and what its effects would be.
   Another major Kilgore mindset instilled at Dow Jones and still evident today is the supremacy of the reporters within the company, Mr. Kann said.
   "The structure matters. The people matter. If the publication is good on any given day, it has to do with the reporters." Of course, Mr. Kann says it also has to do with a lot of other people, but it has to start from digging and finding good stories. "With mediocre reporters, the public will get less information."
   After graduating from Harvard, Mr. Kann applied at The Wall Street Journal on Bernard Kilgore’s recommendation. "Barney suggested I apply, but I don’t know if he helped me get the job," Mr. Kann said.
   He worked at a few of the paper’s bureaus in the U.S. as a reporter but was soon dispatched to Southeast Asia, becoming the first Journal staffer to cover Vietnam in 1967, as a roving reporter based in Hong Kong.
   "I was one reporter covering half the world. It was a large beat. I would disappear for a week or 10 days. They didn’t know where to find me. It wasn’t as if I had to file every day," he said. "I would file my stories by regular mail sometimes. It was leisurely and old- fashioned, more like the 19th century foreign correspondent. Unfortunately for the reporters today, editors are in constant contact with them."
   At the age of 29, Mr. Kann was awarded a Pulitzer Prize for International Reporting for coverage of the Indo-Pakistani War in 1971.
   Over the last 32 years he has risen through the editorial and corporate ranks, and beyond the CEO position. Mr. Kann is also the chairman of the board and an editorial director for all of the company’s publications. But even though he is removed from working in the newsroom because of more business responsibilities, he still likes to give his views to editors and spend time with the editorial board.
   As for business at Dow Jones, Mr. Kann said things really are not looking up yet in terms of advertising revenue, but business looks better than during the "awful and uncontrollable" period late last year.
   Advertising revenue in publishing is seen as a good indicator of the economy because when companies are growing and moving, they have to get their products sold. When there is a dip in the economy, the advertising budget is often the first to go and the last to come back. Mr. Kann said a full page of advertising in The Wall Street Journal costs $200,000. If you buy 30 to 50 pages a year, the price can drop.
   "Our fourth quarter (2002) performance reflects continued cost control and modestly better than expected advertising volume at The Wall Street Journal," Mr. Kann said in a Jan. 23 statement. "…We do not yet see signs of meaningful business-to- business advertising recovery in the near term, as reflected in our outlook for the first quarter for 2003."
   Still, Dow Jones invested heavily into its products and made some major changes in 2002, he said. On April 9, for instance, the company launched a very changed Wall Street Journal, with more sections and features like Personal Journal. Through the additions, the paper was able to greatly expand its space and color capabilities, keys to eventually expanding advertising.
   Those projects over the past years were good for everyone to unite and focus on while business was otherwise slow, Mr. Kann said. "We invested a lot of time, money and effort into the business. We’re running this company for the long term. The changes in The Journal will benefit the readers and advertisers for years and years. In a personal sense, I’m proud of that."
   The advertising slump for the publishing world, however, did not come without its casualties. Mr. Kann and Dow Jones were faced with having to cut costs, laying off about 450 people and making some managerial changes. "You try to do it as sensibly as possible, but there’s no way of doing it without some people getting hurt." Mr. Kann said he hopes the layoffs have stopped and that a raise freeze would be lifted soon.
   Nevertheless, trust in the operation and optimism for the future continue for the company and growth may lead to new products. Dow Jones is considering re-launching its Saturday Wall Street Journal, which has not published since the early 1950s. Also, Mr. Kann said, the company will start Dow Jones News Plus, its "newswire of the future" to offer "better editorial judgment, organization and presentation of the news with easier access." It hopes to begin that service in March.
   Already in the works, Dow Jones announced Jan. 17 an agreement with The Washington Post by which Dow Jones will be able to use material from The Washington Post overseas bureaus in Dow Jones international editions. The deal came about as a result of the sale of The Washington Post’s stake in The International Herald Tribune, an overseas paper it ran jointly with The New York Times. News and editorials will be available starting in April, Dow Jones said.
   As for the state of business and the economy in America, Mr. Kann said things are still uncertain.
   "There’s a jittery economy. Fears of a war and all of these lingering business scandals. There’s a lot of governance issues in corporate America. There is still a nervous feeling out there."
   Asked if better reporting on business could have helped prevent the recent business scandals, Mr. Kann indicated that news coverage and Dow Jones’ influence both have their limits. There were government agencies that were much closer than The Wall Street Journal to companies like Enron that couldn’t avert their disasters, he said. Different research or questioning on the part of the newspapers probably wouldn’t have uncovered any mismanagement because crooked companies lied outright, he said.
   On the other hand, Mr. Kann admits the media tend to overreact.
   "Business scandals get big coverage. You try to break them. Most businesses are run by decent people. In the mass media business becomes synonymous with Kenneth Lay and John Rigas (Enron, Adelphia). The public sees business as a bunch of crooks. That’s not factual and not fair. There is a tendency for the pendulum to swing too far. We try to avoid the pendulum from swinging too far."
   But the scandals did provide ample material for stories. "In a sense, business scandals and problems are very interesting. They make news. An airplane landing safely is not news. Crashing is."
   As a business person, you have to know what you are looking for in a news product, he noted. "If you try to get your business news from TV, you’ll often get a silly and exaggerated version of the issue. If people read The Journal, they’ll get a better, more in- depth version of a topic. The consumer has to know what they’re trying to find out and to pick the appropriate publication."
   More than 2½ million people rely on the domestic print and online versions of The Journal for that financial and business news — perhaps, as Mr. Kann explained, because the information presented is not insurmountable. The structure is designed so that writers often are not experts in the areas they are writing about; a concept that is credited to the Kilgore theories, Mr. Kann said. The end result is that writers are forced to explain the sometimes arcane very simply.
   "Business is intrinsically interesting," Mr. Kann said. "It’s something that involves politics, people, conflict and controversy. It is not so innately different than covering politics or urban affairs. It’s something that can greatly benefit the reader."