By Mick Gregory
“I don’t know if we will be printing in five years, and you know what, I don’t care,” said Pinchy Suzberger, New York Times publisher.
You know what Pinchy? Most of us don’t care either!
Profits at the Times have been declining for going on five years, and the Times company’s market capitalization has been crumbling faster.
The Times wrote down the value of its New England Media Group—which includes The Boston Globe—by $814 million, resulting in the shocking quarterly drop announced last week. Oopsie!
Yet, as they hold “town hall” meetings with their working stiffs at the Boston Globe, the editors made room to hire Dean Baquet and hand him the Washington DC throne. Baquet, you may recall, is the executive editor who refused to make any more cuts at the LA Times which has a 950 person newsroom.
But Mr. Baquet, you just joined a paper that has cut some 150 journalists in the past year? No problems with that, eh?
Thursday, February 08, 2007
Janet Robinson’s pep talk: first impression
Word is, the Times Co. president/CEO faced a very tough crowd at Morrissey Boulevard today. Here’s what Media Log has heard so far:
It was a very hostile meeting. I would say most of the hostility came from the classified ad people who’re being outsourced to India. This woman–her name doesn’t matter–got up and said, she’s been there 37 years, she loves the company, and basically, how can you do this? The paper’s been cut back; we’re kicked out; is this corporate greed or what?
So Janet Robinson right off the bat had to handle this highly indignant, well-spoken classified ad person.
(Note: classified sales people are subhuman in the eyes of the far superior editorial department, so the surprisingly well spoken woman doesn’t get a name).
And she just kept on talking about how they’d had to make very difficult decisions, they wouldn’t be doing them if it wasn’t necessary. That was basically the theme: in order to save the village, we have to destroy it.
The people really kept at her about the outsourcing–that was really the main theme. Dan Totten [the Globe union head] said it was appalling and disgusting, and when did they make the decision–because let’s face it, we just agreed to this contract, and right after that they announced this outsourcing. Was that bad-faith bargaining? And [Robinson] never really gave an answer. She said [the outsourcing] had been under consideration for at least a year, but they didn’t make the final decision until the terrible results of the final quarter were known. They didn’t have a choice.
Somebody said, why do you still want us as part of [the Times Co.] portfolio? And she went on about, you’re a beacon of great journalism, people want to buy you and I admire their taste, but you’re a very important part of the company.
Morgan Stanley, has set out on a campaign that could cost Sulzberger control over the paper. The New York Times is one of a unique few that have a two-tiered stock plan. The family holds a fraction of the stock, but they are voting stocks, the majority of the stockholders do not have a vote on decisions of the company. They ivory tower “executive editors” at the Times have been making horrible business decisions. And Morgan Stanley has been communicating the reasons why.
The details are by AFX International Focus — The New York Times has refused to list on its proxy a proposal from a Morgan Stanley investment fund that called for putting the company’s two-class share structure to a vote.
That system, which has existed since before the company went public in 1969, cements control of the company with the Ochs-Sulzberger family. The company says the control is necessary to protect the editorial integrity of the newspaper.
The Morgan Stanley fund had proposed the measure in November after expressing dissatisfaction with the company’s share price and what it called a lack of accountability to public shareholders.
Catherine Mathis, a spokeswoman for the Times, said the Times rejected the proposal last month, with the blessing of the Securities and Exchange Commission, after determining that the issues being raised in the proposal couldn’t be voted on by holders of the company’s publicly traded stock.
Those shares, which are called Class A stock, have limited voting rights, such as electing 30 percent of the company’s directors, the approval of certain acquisitions and other matters, she said. The more powerful voting rights belong to the Class B shares, which are almost entirely controlled by the Sulzbergers.
The company rejected the proposal last December, Mathis said, but the news became public late Tuesday in a regulatory filing made by Morgan Stanley Investment Management.
And Mr. Sulzberger had to get away. He jumped on a jet to the World Economic Forum at Davos, Switzerland. Remember, that’s where Senator John Kerry called the USA a pariah to the civilized world?
Then they fit in some skiing at one of the ritziest resorts in the world.
What began as a casual chat ended in a fascinating glimpse into Sulzberger’s world, and how he sees the future of the news business.
By Eytan Avriel of Haaretz.com
Given the constant erosion of the printed press, do you see the New York Times still being printed in five years?
“I really don’t know whether we’ll be printing the Times in five years, and you know what? I don’t care either,” he says.
Sulzberger is focusing on how to best manage the transition from print to Internet.
“The Internet is a wonderful place to be, and we’re leading there,” he points out.
The Times, in fact, has doubled its online readership to 1.5 million a day to go along with its 1.1 million subscribers for the print edition.
Sulzberger says the New York Times is on a journey that will conclude the day the company decides to stop printing the paper. That will mark the end of the transition. It’s a long journey, and there will be bumps on the road, says the man at the driving wheel, but he doesn’t see a black void ahead.
Asked if local papers have a future, Sulzberger points out that the New York Times is not a local paper, but rather a national one based in New York that enjoys more readers from outside, than within, the city.
Classifieds have long been a major source of income to the press, but the business is moving to the Internet.
Sulzberger agrees, but what papers lose, Web sites gain. Media groups can develop their online advertising business, he explains. Also, because Internet advertising doesn’t involve paper, ink and distribution, companies can earn the same amount of money even if it receives less advertising revenue.
Really? What about the costs of development and computerization?
“These costs aren’t anywhere near what print costs,” Sulzberger says. “The last time we made a major investment in print, it cost no less than $1 billion. Site development costs don’t grow to that magnitude.”
The New York Times recently merged its print and online news desks. Did it go smoothly, or were there ruffled feathers? Which team is leading the way today?
“You know what a newspaper’s news desk is like? It’s like the emergency room at a hospital, or an office in the military. Both organizations are very goal-oriented, and both are very hard to change,” Sulzberger says.
Once change begins, it happens quickly, so the transition was difficult, he says. “But once the journalists grasped the concept, they flipped and embraced it, and supported the move.” That included veteran managers, too.
How are you preparing for changes to the paper that are dictated by the Internet?
“We live in the Internet world. We have, for example, five people working in a special development unit whose only job is to initiate and develop things related to the electronic world – Internet, cellular, whatever comes.
The average age of readers of the New York Times print edition is 42, Sulzberger says, and that hasn’t changed in 10 years. The average age of readers of its Internet edition is 37, which shows that the group is also managing to recruit young readers for both the printed version and Web site.
Also, the Times signed a deal with Microsoft to distribute the paper through a software program called Times Reader, Sulzberger says. The software enables users to conveniently read the paper on screens, mainly laptops. “I very much believe that the experience of reading a paper can be transfered to these new devices.”
Will it be free?
No, Sulzberger says. If you want to read the New York Times online, you will have to pay.
In the age of bloggers, what is the future of online newspapers and the profession in general? There are millions of bloggers out there, and if the Times forgets who and what they are, it will lose the war, and rightly so, according to Sulzberger. “We are curators, curators of news. People don’t click onto the New York Times to read blogs. They want reliable news that they can trust,” he says.
“We aren’t ignoring what’s happening. We understand that the newspaper is not the focal point of city life as it was 10 years ago.
“Once upon a time, people had to read the paper to find out what was going on in theater. Today there are hundreds of forums and sites with that information,” he says. “But the paper can integrate material from bloggers and external writers. We need to be part of that community and to have dialogue with the online world.”
And while on community, the scandal about Jayson Blair, the reporter caught plagiarizing and fabricating, hurt the brand, not the business, he says. Blair was forced to quit in May 2003.
You’re one of the few papers that continues to print on broadsheet, which people consider to be too big and clumsy. Until when?
“Until when? The New York Times has no intention of changing that,” Sulzberger promises. At any rate, transitioning from broadsheet to tabloid would be prohibitively expensive, he says.
If you own any of those secondary NY Times stocks, I think it’s time to sell.