But today, three years later, the newspaper has more than doubled web traffic, raised the cover price by 40 per cent and seen circulation revenue grow.
So how did it get here?
Speaking at the World Editors Forum in Kiev today, executive editor and senior vice president for the Seattle Times David Boardman explained the key elements of the strategy that has seen it transform into a multi-platform newsroom which puts its mantra - "news you can't get anywhere else, when, where and how you want it" - at the heart of its practices and organisation.
Restructuring the newsroom organisation
From the launch of the Seattle Times website, the structure had followed a separate print and web operation within the news department. But in time the title found that this structure and the connected workflows were "very much getting in the way of what we wanted to achieve".
This prompted the development of a new structure based on three key groups: creation, curation and community.
As Boardman explained, the creation team are those who are "out there producing content".
This challenges the notion "that we as a lot of other newspapers became too focused on the pipeline and not what is going into the pipe".We as a lot of other newspapers became too focused on the pipeline and not what is going into the pipeDavid Boardman
Secondly, the curation team refers to the "people really focused on that notion of how we get content to readers in the form they want it", as well as "playing to the strength and competencies of each platform".
Finally, the community refers to both staff and members of the public, and is focused on aspects such as interactivity, outreach and social.
And all three groups fall within the overall focus of "increasing engagement", which Boardman described as the "coin of the realm for all news orgnisations".
Redesigning physical space
The next step was to redesign the actual spaces these teams worked in, and interacted with.
Around the news hub sits the curation team, around that sits creation and on the outside of that is the community.
The redesign also saw metrics placed into the daily discussion, Boardman added, with television screens showing not just the news but also 15-second updates on how users are engaging with Seattle Times content.
Reinvented approach to competition
In a bid to reassess how it was approaching competition, the Seattle Times set up a network of local, independently-run blogs based on specific geographic areas of topical interests.
He said the Seattle Times signposts its users to these blogs, sends traffic to them, and the metrics are showing that those users are coming back to the Seattle Times.
This strategy supports the "notion of us as the town square of news and information", he added. And is also "all geared to the notion of one mission, many platforms".
Addressing the culture of the newsrooms
One of the biggest obstacles, Boardman said, was tackling the culture of the newsroom.
He said the Seattle Times wanted to reject the notion of producing one product and pushing it out in different ways, instead it wanted to "create 24/7 companionship with our community".
But he said that staff who have witnessed the "near-death collective experience" and seen other journalists elsewhere lose jobs has made them "eager to do what needs to be done".
And the organisation leaders try to involve their staff in discussions and bring them into what needs to be done.
Reaping the rewards
In the past couple of years (in 2010 and 2012) the Seattle Times has won two Pulitzer Prizes, one for breaking news and another for investigative reporting.
And the news outlet was last week shortlisted for the Online News Association award for general excellence in online journalism, alongside the Wall Street Journal, New York Times and CNN.
"So I think this approach is having some success," he added.
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