David Geffen and the New York Times.
I would be remiss if I did not point out that the odd couple of the American media business these days is David Geffen
and that other would-be owner of the Times
, Rupert Murdoch.
Geffen and Murdoch were brought together by Murdoch’s wife, Wendi. The relationship blossomed not least of all because most of the other people in Wendi’s circle were lefties and glamour pusses. Geffen, is, too, a lefty and glamour puss, but, also, a billionaire with a relentless focus on media business talk. Murdoch likes nothing better than to talk, without respite, about the media business, and to do it most of all with other billionaires—even gay
(“poofters” in Murdoch lingo) former rock impresarios (Murdoch is not exactly your rock type).
The two billionaires speak now a few times a week. Often, they check in with each other every day. Geffen is a great source of gossip for Murdoch—reliable gossip, in Murdoch’s estimation; Murdoch is a great source of less-than-reliable gossip for Geffen.
As important, Murdoch and Geffen may be the last men in America still interested in newspapers—certainly they are the two richest men in America still interested in newspapers.
Murdoch offered Geffen a discouraging analysis of the Los Angeles Times
when Geffen expressed interest in the paper. Geffen, for his part, acted as Murdoch’s intermediary to Sam Zell, the owner of the Chicago Tribune
and the LA Times
, when Murdoch was briefly interested in buying Newsday
, another of the Tribune Company’s papers.
That they are both irrationally fascinated by the New York Times
furthers the bond. Not least of all because the Times
provides such a never-ending source of gossip. What both men are doing—spending ever-growing chunks of their business day doing—is trying to work out, and, possibly, game the Times’
fate. What’s the mood of the Sulzberger family? What’s the mood of the Times’
big shareholders? How far will the Times’
And, most critically, what’s the number?
Murdoch paid $5.6 billion, a 68% premium over the share price, to convince the Bancroft family to sell him the Wall Street Journal
. What’s the number the Sulzbergers will need to cash out
? Indeed, having wildly overpaid for the Wall Street Journal
, Murdoch is trying to figure out what, at the Times’
current market value of $800 million, the Sulzberger premium will have to be. But Murdoch, given his own sinking share price, knows that this time he can’t egregiously overpay to dislodge them—so he waits.
Geffen, who has been floating the suggestion
of making the Times
a not-for-profit foundation, is reported to have put feelers out to the hedge fund that owns a big chunk of Times
shares, suggesting a price slightly above market but well below where the hedge fund bought them. No dice—yet.
The obvious question is to what extent are Geffen and Murdoch working together? Working together solves a great problem for each of them: Geffen can’t run a newspaper—what he would like is the titular role he had at DreamWorks—and Murdoch would take less heat if he had someone else’s cash in the deal.
As they gossip together about the Times
, they themselves are quite a juicy tidbit.
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 firstname.lastname@example.org.