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At N.Y. newspaper, Warren Buffett leads from afar

Billionaire says he plans to buy more publications

BUFFALO — Over the years, newspaper owners have built monuments to themselves in the form of giant buildings, statues, and plaques. At the headquarters of The Buffalo News, a sand-colored office building, the only visible sign of the owner is a small photo hanging in the office of the publisher, Stanford Lipsey, signed, ‘‘To the best in the business, Warren.’’

Warren is, of course, the billionaire Warren E. Buffett, but the modesty of his physical presence — he has not visited the newsroom in eight years — understates his interest in the paper, which his company, Berkshire Hathaway, bought in 1977.

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Buffett’s views on newspapers have been a hot topic. Three years after telling shareholders he would not buy a newspaper at any price, Buffett has moved aggressively into the business, buying 63 local papers and revealing a 3 percent stake in Lee Enterprises, a chain of mostly small daily newspapers based in Iowa.

In a letter Buffett sent to the publishers and editors of all Berkshire Hathaway daily newspapers, he described himself as a newspaper addict who planned to buy more papers. While he is less certain how he will make papers profitable in the digital age, he’s confident that in certain cities, newspapers will thrive.

‘‘I do not have any secret sauce,’’ Buffett said in a phone interview. ‘‘There are still 1,400 daily papers in the United States. The nice thing about it is that somebody can think about the best answer and we can copy him. Two or three years from now, you’ll see a much better-defined pattern of operations online and in print by papers.’’

The best indicator of what Buffett may do is what he has done with The Buffalo News. Interviews with more than a dozen current and former editors paint a picture of a profitable paper that is run with little involvement from its owner. Some journalists say the owners will hold out as long as they can to buy the latest printing presses and that they wish the paper dedicated more resources to the highly ambitious journalism that wins the biggest awards. But many workers agree the owners do not skimp on sending journalists to town meetings or on enterprising local journalism.

‘‘In Grand Island, Neb., everyone is interested in how the football team does. They’re interested in who got married. They’re maybe even more interested in who got divorced,’’ Buffett said.

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But being owned by Berkshire Hathaway has not shielded The News from the industry’s slump. In 2011, the union said newspaper officials told them the paper earned a profit of $9.3 million, the first time the paper’s profits fell below $10 million in a quarter-century. Lipsey said The Buffalo News often reported annual profits in the 1980s of $55 million. Since 2009, nearly 100 full-time jobs have been cut, said Henry L. Davis, president of Buffalo Newspaper Guild. The unionized staff members who remain have had a 1 percent raise since 2009.

The newsroom staff is now 140, from 200 about a decade ago, with cuts made mainly through buyouts rather than layoffs. Retirees have few complaints about the pension managed by Berkshire Hathaway because the maximum retirement payouts have been raised. Newsroom employees still have their health benefits fully covered.

‘‘We do kind of consider ourselves lucky,’’ said Gene Warner, a reporter with the paper for 32 years who retired in 2010. ‘‘We’re not bleeding red ink.’’

Lipsey hopes to improve the paper’s fortunes by unveiling a version for Apple’s iPad and a paid subscription model. He is expanding into commercial printing and hopes for double-digit growth this year.

Margaret Sullivan, appointed managing editor in 1998, said that Buffett had offered guidance when asked and offered praise for the paper’s awards. But he is not involved in editorial decisions. She said she had the financial resources to hire staff when necessary and to approve investigative projects, but she does not have an endless bank account to spend on prize-winning journalism.

‘‘We don’t have all of the resources behind us. We do really strong work, not to win awards, but to benefit the community. I think we’re very ambitious in our reporting.’’

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