The
Boston Globe has analyzed its own dire predicament—wherein its parent company, the
New York Times, is threatening to close it unless
Globe workers kick back $20 million—in a generous fashion.
The newspaper business itself is at fault, the
Globe wrote in a story about itself—classified advertising revenue has been snatched by the Internet. The
Globe reports that
its fortunes have been waning in a dramatic way since 2004 and that it's on track to lose $80 million this year. It’s not the
Times' fault, rather it's just the world as it is. And nobody has any answers.
But how come, given five years of gloom and dwindling alternatives, the
Times still owns this clunker?
Just a little more than two years ago, when the
Globe was already profoundly ailing, former GE CEO Jack Welch and Boston advertising legend Jack Connors
said they’d be willing to take the paper off the
Times’ hands. Welch and Connors hired JP Morgan, which valued the
Globe at $550 million to $600 million—below the $1.1 billion the
Times had paid more than a decade earlier, but not a bad deal for 2006. The
Times said nothin' doin'.
(AP Image)
What were they thinking? This asset of theirs had already lost half of its value and nobody but nobody is predicting a turnaround in the newspaper industry, but…they had a plan?
Indeed, why else would you keeping a flagging business, with a cash offer on the table, unless you had a plan?
And that plan would be…? Surely, the
Times investors have a right to know what that failed plan was and who was responsible for it.
Except what if there was no plan? What if, as the
New York Times has squandered its patrimony, there has never been a plan, except for blind faith?
In the case of the
Globe, there was a special amount of blind faith.
The
Globe could be in near extremis, but in the executive office of the
Times the central business analysis was that nothing could be done, no transaction could involve the
Globe as long as the publisher's father, Arthur Sulzberger, who bought the
Globe when he was publisher, was still compos mentis.
It was a family thing. “We view the Globe as an important asset, and we have taken many steps that we believe will improve its performance,”
said Times spokesperson Catherine Mathis, a woman who has been forced to utter more nonsense than possibly any other flack in the media business.
It was noblesse oblige as usual. The
Times, and its shareholders, would shoulder the burden of the
Globe because it, too, was part of the Sulzberger legacy.
Newspapers make newspaper people stupid. Newspaper people do not have the ability or the imagination to see the end of newspapers—or a way out of them.
They’re all trapped here. Jack Welch’s $600 million could have bought the
Times out of one of the toughest spots in its history, but it would not have been right. Better we all die with our boots on.
More of Newser founder Michael Wolff's articles and commentary can be found at VanityFair.com, where he writes a regular column. He can be emailed at michael@newser.com
