Wall Street Journal Editor Resigns; End of Era Seen

Norman Pearlstine, who piloted the Wall Street Journal during its most ambitious growth period, announced Wednesday that he would resign as executive editor to become a media entrepreneur.

Pearlstine, 49, had been named to the post only 11 months ago, saying at the time that he would give up day-to-day running of the paper and instead focus on long-term projects for parent company Dow Jones & Co.

The company said Pearlstine’s Journal news department responsibilities will now be handled by Paul E. Steiger, 49, who last year was named Journal managing editor.

Pearlstine had been appointed managing editor in 1983 and was responsible for a major expansion of the paper’s staff, including hiring for the first time a large number of experienced reporters from other publications. But no sooner was the expansion well under way than the Journal’s prospects nose-dived. It was hit especially hard by the 1987 stock market crash, which caused a sharp downturn in both financial advertising and subscribers.

Some corporate insiders blamed Pearlstine for expanding too ambitiously, and the expansion was hastily replaced by unprecedented austerity.

Pearlstine over the years was a pivotal figure at the Journal--he was chosen to lead many of Dow Jones’ start-up ventures, including the Asian Wall Street Journal, a European edition of the Journal, the creation of the Journal’s third daily section and, most recently, Smart Money, a joint-venture magazine with Hearst Corp.

“Over the last year I began remembering how exciting it was to start things up. The more I got into it, the more I asked why not do this on my own?” Pearlstine said in a telephone interview.

“The outside world will remember Pearlstine for the roaring 1980s,” said Dean Rotbart, editor of the journalism newsletter TJFR Business News Reporter and a former Journal staff writer. “But many of the people at Dow Jones will remember him as the boy wonder that discovered growing up is not so easy.”

Rotbart and other observers said that the stage for Pearlstine’s exit was actually set a year ago when he was elevated to the role of executive editor.

“He learned so much starting Journal editions in Asia and Europe that it became a unique knowledge that he has to put to use in another way. That’s basically what’s going on,” said TV and film producer James Brooks, one of Pearlstine’s closest friends.

Pearlstine would not discuss his specific plans, but some insiders believe that given his keen interest and connections in Hollywood they would not be surprised if he ended up working in the entertainment industry.

Pearlstine, however, downplayed such speculation. “I wouldn’t rule anything out, but it doesn’t exactly follow the kinds of things I’ve done before.”

Pearlstine will remain a consultant to Dow Jones over the next year on Smart Money and various book and TV projects.