July 17, 2008

Dear Readers,

These are tough times for printed newspapers.

Paper and fuel costs are soaring. The way many people get their news has been changed forever by the Internet. A worsening economy has prompted some businesses to cut advertising spending. We're experiencing what many in our industry are calling "a perfect storm."

Significant change - transformational change - is required to meet the evolving needs of our readers and our advertisers to ensure a strong, sustainable business.

At the AJC, we have set a course to do three key things:

• Expand our already robust Internet business.

• Reset the business model for the printed newspaper to prepare us for the future.

• Reduce overall costs.

This work began nearly two years ago, and has involved the best thinking of many of our employees, as well as feedback from thousands of our readers and hundreds of our advertisers. Although the reinvention of the AJC will continue to play out in the weeks, months and years to come, we have several developments to announce today.

Beginning next month, we'll be simplifying our daily newspaper, Monday through Saturday, both to conserve costs and to focus on our core mission of covering Metro Atlanta in-depth.

The most significant of the daily product changes is the discontinuation of our geographically targeted community sections. This includes the daily Gwinnett News section as well as the NorthSide, CityLife and NorthWest sections.

While the sections will go away, coverage will continue. The daily Metro and Sports sections will expand to include more news and information from these communities. Our reporting staffs in Gwinnett, Cobb, DeKalb and North Fulton will remain in those areas, filing stories both for ajc.com and the printed AJC.

Other changes to the paper include:

• Moving Better Health features from a stand-alone section into an expanded Wednesday Living section;

• Merging content from Saturday's Buyer's Edge section into an expanded Sunday Living section;

• Strengthening the Sunday Homefinder section, and moving the HomeStyle decor and remodeling section from a limited-circulation run on Thursday to full distribution on Sunday.

Simply put, the cost to produce these sections has become prohibitive. Paper costs have risen 35% in the past year and, since we drive 80,000 miles a day to deliver the AJC, fuel costs have hit us hard. While we know many of our readers enjoy these sections, these moves overall are consistent with feedback from time-starved readers that the newspaper should become more focused and easier to navigate, particularly during the week.

We are also announcing a staff reduction of about 8% of our full-time workforce that will occur between August and October. The reductions will come from various areas of our business. These changes come on top of a series of planned reorganizations already completed across AJC departments over the past 18 months.

The changes announced today, particularly those involving our employees, are difficult. However, they are necessary to sustain us in the present and position us for future growth.

We are rapidly becoming a multi-media company with strength in the print and Internet worlds.

• Our total audience is larger than ever. Every week, 2.2 million adults are reading the AJC in print or online. That's an increase of nearly 7% since last year.

• In 2007, ajc.com logged more than 1 billion page views.

• Our mobile traffic hit the 1 million mark - per month - earlier this year.

• The Sunday AJC is a resource for more Metro Atlantans than any other single medium in our area.

• We remain the largest news-gathering organization in the Southeast.

We are deeply appreciative of our readers, Internet users, advertisers and the community at large. Your needs are guiding us, and we look forward to serving you for years to come.

As always, we appreciate the opinions and ideas of our readers. On July 16 and 17, I invite you to visit ajc.com/changes to share your comments, or please feel free to e-mail us at insideajc@ajc.com.

Sincerely,

John Mellott, Publisher