Russ Stanton is one of my favorite people. Imagine the stereotype of a reserved, slightly stuffy big-city editor and that’s not Russ.The editor of the Los Angeles Times for the last 20 months, Stanton is uncommonly down to earth and available. But the main reason I like him is his public honesty. Stanton’s default response is to tell the truth — something that doesn’t come easily to most executives struggling to keep their enterprise alive. Asked earlier this year how many news staffers could be sustained if the Times went Web only, Stanton could have been forgiven for taking a pass. He didn’t. The answer, he said, was 150.

So when Stanton visited our USC Annenberg graduate class last night, “Entrepreneurship in the New Media,” I believed him when he said he’s bullish about prospects for the Los Angeles Times, even as it sits in Chapter 11 with huge questions looming about its future.

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The Times, he said, has a decent shot of emerging from bankruptcy court with very little debt and a ledger sheet that puts it into positive territory for the first time in a long while. In the meantime, he said, the Times has moved down the road toward remaking itself as a Web-oriented news organization no longer burdened with the newspaper’s old visions of national and international grandeur. The Times, he told our class, is for and about southern California.

Most interesting to me was Stanton’s telling of the Times’ new local strategy. On the surface, the Times would seem to have a hopeless challenge trying to serve the sprawling, vast, diverse LA landscape. If the Internet favors ever smaller and specialized niches, how can that benefit a news organization trying to cover a region that Stanton said is the size and population of Ohio?

Stanton acknowledged the Times had a history of spending vast sums trying to conquer Orange County or the San Fernando Valley, only to throw in the towel when advertising failed to support the editorial extravagance. The new local strategy abandons the idea of using staff reporters to make a market, and instead relies on citizen participation and data.

The citizen participation part is a work in progress that probably will rely on partnerships and blogger networks, but the data portion will take a big step in a few days when the Times launches its neighborhood-by-neighborhood crime data project. The data will cover 113 LA neighborhoods (the boundaries of which were helped decided by readers), and has the enthusiastic involvement of the LA Police Department.

Other notes from Stanton’s talk:

— The Times believes its real breakthrough will come when an e-reader is developed that will achieve iPhone-like acceptance by the public.Stanton said Times publisher Eddy Hartenstein is keenly interested in this arena, and likens it to the way, in a previous job, Hartenstein shook up the cable industry with DirecTV. Stanton, by the way, said the Times has 2,700 Kindle subscribers.

— The Guardian will probably be the Times’ new model for how it sees the relationship between its Web and print offerings. The Times‘ Web site today still is dominated by stories that appeared in the morning paper. But Stanton said that will change by taking the Guardian approach — focusing overwhelmingly on writing (and re-writing) for the Web, with the latest of those re-writes serving as the next morning’s newspaper story.

— The Times continues to expand its Web audience when many newspapers are stagnating. Stanton acknowledged the Times got well behind on the Web front, but now its audience growth is fastest among major newspapers, he said. 170 of his news staffers have Twitter accounts, he said.

Finally, I asked Stanton the leadership question. How does he keep the news team upbeat and mission-driven when the Times is surrounded by trouble and uncertainties. He listed three things: First, personal time spent talking to news staff. “I also write a lot of notes,” he said, recalling he still cherishes a note he received from former editor Michael Parks (also CCLP Faculty Fellow). Second, he preserved four areas (albeit some with fewer resources) that are a part of the Times’ cherished history — foreign, national, sports and entertainment. Lastly, he said, “We have to pick our spots" and do those well. Gone are the Times‘ bigger-than-life initiatives and intense focus on winning Pulitzer Prizes.  It’s realpolitik time at the Times. And what about those who disagreed with the new strategy? Said Stanton: “They’re gone.”

(Note: An earlier version of this story misstated Stanton’s tenure as editor. It’s 20 months. It also inaccurately described Stanton’s estimate of the news resources a Web-only operation at the LA Times could sustain. His estimate was 150 news staffers, not 150 reporters.)