The Boston Globe is now officially in play. That’s the real meaning behind Steve Bailey’s front-page story reporting that a local group wants to buy the Globe from the New York Times Co.
Not that retired General Electric CEO Jack Welch, Boston advertising executive Jack Connors, concession magnate Joseph O’Donnell et al. are necessarily going to succeed in their quest. But watch: Now everyone who’s ever harbored the fantasy of owning the Globe is going to surface. The sense is that now is the time. (The Boston Herald adds a wrinkle: Mall developer Steve Karp may be involved with the Welch/ Connors/ O’Donnell group as well.)
That said, it could well be that the Times Co. won’t even consider selling. The company bought the Globe in 1992 for $1.1 billion — a huge amount, given that the Times Co.’s worth 14 years ago was $2.2 billion.
Did you see what Bailey’s reporting the Globe is worth now? Try $550 million to $600 million, in 2006 dollars. Surely Arthur Sulzberger Jr. would like to goose that up before unloading the Globe, unless he concludes that the price is only going to keep dropping.
Last Friday I mused about the possibility of local ownership, writing:
What’s missing is an identifiable group of Boston-based investors who’d be interested in buying the Globe. I would love to see such a group step forward so we could all have a look. A locally owned Globe might be a better Globe — but it all depends on who those owners might be.
I have to say that Times Co. ownership looks pretty good compared to the Welch crowd. Perhaps my own last name will allow me to get away with a bit of ethnic profiling, but this looks like the Revenge of the Pasty-Faced Irishmen. This is Old Boston, not New Boston — a nostalgia move, about the past rather than the future. Two items in Bailey’s column tell you all you need to know:
— Mike Barnicle, the ethically challenged former columnist for the Globe and, more recently, the Herald, is involved in some sort of consulting role. Barnicle has been a frequent, if little-seen, presence on MSNBC (co-owned by GE) since leaving the Globe in 1998. Barnicle’s wife, Bank of America executive Anne Finucane, used to work for Connors. Might this presage Barnicle’s return to the City & Region front? Good grief.
— Bailey reports that it’s “unclear” whether the Welch group wants Boston.com. Frankly, I’d be a lot more impressed if the would-be owners wanted Boston.com but were “unclear” about whether they wanted the Globe. The arithmetic is pretty simple. Revenues at the paper are huge but dropping. Revenues at the Web site are small but rising.
The Welch/ Connors/ O’Donnell move comes at a time when industry observers are questioning not just the chain-ownership model but the very idea of whether newspapers can remain a profitable business.
As Bailey and others (including Media Nation) have noted, the Philadelphia Inquirer has gone from chain to local ownership, and the Chicago-based Tribune Co. is under pressure to sell the Los Angeles Times to local investors.
But the new owners of the Inquirer have announced cuts that go beyond what Knight Ridder ever tried to do. And though Bailey reports that the Welch group would be willing to operate the Globe at a lower profit margin than the Times Co., the Wall Street Journal reported last week that the Globe right now isn’t earning any profits at all.
Among the more promising models is that of the nonprofit foundation, which is how papers such as the St. Petersburg Times, the Christian Science Monitor and Britain’s Guardian.
Could such an arrangement work with a large metropolitan daily such as the Globe?
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The Chief
Is this what it takes for Welch’s wife to get a job? Be careful what you wish for…
Anonymous
Welch wants to buy the Globe and ignore Boston.com?Geez, and I thought his baseball commentary on NESN was worthless.
MeTheSheeple
Dang, I thought I’d be the first to get in the obligatory crack about how much Jack Welch … cared for … newsies.The Globe deal could be big news, but right now it’s in the early-maybe stages. I think maybe the bigger news is the Gatehouse IPO, which surprised a lot of people. Editor and Publisher here, Reuters here. Who woulda thunk?
Anonymous
I’d call you a self-loathing Irishman for your Harp-baiting comment. But I think in the interest of full disclosure, you should admit you’re Irish in the way that Ronald Reagan was Irish, instead of the Tip O’Neill kind. I don’t think having the name Stein, for example, allows you to say “hook-nosed Jew” if you’re a Lutheran.
Dan Kennedy
Anon 9:14: In the interest of full disclosure — since I’m the one who brought it up — I am part-Irish, as is Mrs. Media Nation. I am not (nor have I ever been) a Catholic, though my late father was until he hit his 20s.
man who's a catholic school bitch
Dan, have you been to Catholic School? That gets you to at least a “1/8th Catholic”, regardless of your religion. I did four times hard time at St.Bernard’s High in Connecticut. I went in Congregationist. I came out atheist. I’m not really sure what the hell religion I am now, which could be argued that the “Catholic Education” worked! 🙂
Aaron Read
Shoot! I was hoping a Globe sale wouldn’t come up for a few more years; give Boston University more time to get that “we must prove we’re better than Harvard” bloodlust going (after all, they’re already more expensive than Harvard) so they’d be willing to entertain buying the Globe. I seriously doubt they’d do it now.Sigh ah well. I still think it’s a good idea. Pity it won’t happen.
Anonymous
I’d be a lot more impressed if there were a name mentioned of someone not eligible for Social Security. All that money won’t make them immortal. (Unless they enlist Sumner Redstone).
David
You wrote:> The Boston Globe is now officially in > play. That’s the real meaning behind > Steve Bailey’s front-page story > reporting that a local group wants to > buy the Globe from the New York Times > Co.Dan: How in the hell do you know what the “real meaning” of these steps are? Do you have special contacts or inside information? (If so, you certainly haven’t revealed anything like that.) Face it: you’re merely speculating, with no harm to you if you’re wrong. This is typical of all pundits who feel free to mouth off without any consideration for whether they’re right or not.What is your punditry record??David
Dan Kennedy
David: You seem to hold a very low view of pundits. In that context, I’d say my punditry record is outstanding!More seriously — I guarantee you that Jack Welch, Jack Connors and Joseph O’Donnell are not the only three rich people who are interested in buying the Boston Globe. If we don’t hear about other possible buyers at some point, I will refund your subscription fee in full.Frankly, I find your comment to be rather odd. What did you wander in here for if not for speculation? I did cover the Globe for more than 10 years. I continue to talk with media people on a regular basis. Yes, I’m speculating, but I’d like to think I’m offering informed, educated speculation.Mark my words: If the Globe is for sale, the Welch group will not be the only potential buyer that we’ll hear about. I’ll be proven right about that.
mike_b1
Dan, David has a point. If the Globe is for sale, then it is in play. If’s if not — as the NYT insists — for sale, then it’s not “in play,” no matter who claims to be sniffing around. And after making the bold assessment that the Globe is in play (for sale), you then qualified it in your response to David above.Now, perhaps the NYT leaked something to Bailey in order to stir the pot and drum up interest. And perhaps Connors called Bailey and talked him into writing something up in order to press the Times’ (or their shareholders) into action. I could see that. But only the former means the Globe is “in play.”
Dan Kennedy
Mike: No. This is important, so let’s run through it. I did not qualify my statement that the Globe is in play in my response to David. I qualified it in my original item. I wrote: “That said, it could well be that the Times Co. won’t even consider selling.” I can’t be any clearer than that.So what do I mean by “in play”? Exactly what I wrote. More potential buyers will come forward. If any of these deals looks like it would be good for the shareholders of the New York Times Co., then the Sulzbergers will be under tremendous pressure to sell.I realize that the Sulzbergers don’t have to sell — there are two classes of Times Co. stock, and the Sulzbergers hold the only class with voting power. Still, they have some fudiciary responsibility to shareholders, even if it’s moral rather than legal.So yes, the Globe is now in play, and if Arthur Sulzberger Jr. doesn’t want to sell it today, that doesn’t preclude his changing his mind six months from now. Other family members might change it for him. I’m sure you’ve read the reports that his position might be tenuous, although that talk was a lot louder a year ago than it is today. Here’s the Ken Auletta must-read.You will notice that the Times Co. has not said that the Globe isn’t for sale — the Globe had to issue a correction to that effect this morning.In other words, David and Mike, I stand by every word of that item.
mike_b1
“If the Globe is for sale” sounds like a qualifier to me.And Wall Street would completely disagree with your definition of “in play.” Neither Welch nor anyone else is taking positions in Times Co. as a way to influence their decision on the Globe.Not that it matters.
Dan Kennedy
Mike: I had a qualifier in my original item! What part of this do you not get?
mike_b1
Jesus. Dan, you wrote to David: “Mark my words: If the Globe is for sale, …””If” is a qualifier.
Dan Kennedy
Mike: Jesus, yourself. You claimed that my comment to David was the first time I had qualified it. You wrote above: “And after making the bold assessment that the Globe is in play (for sale), you then qualified it in your response to David above.” And I have pointed out to you — three times, now, I guess — that I qualified it in my original item. This is not a big deal, but please stop.
mike_b1
Dan’s original post, first sentence: “The Boston Globe is now officially in play.”That’s a statement, clear-cut, no maybes or perhaps about it.I never said anything about your response to David as being the first time you qualified it.Look, either you think they are in play or you don’t. You’ve first said they are. Then later you said “If they are.” Which is it?I don’t think they are.
Dan Kennedy
Mike: First off, I’m sure no one’s left reading this but the two of us. Second, I think I see what the problem is — you don’t know what “in play” means. Here you go: “Rumored to be vulnerable to a takeover attempt.”Can a property simultaneously be vulnerable to a takeover attempt and not for sale? Uh, yes. That’s the positon the Globe finds itself in now. (That is, unless it is for sale.) Indeed, the sort of takeover attempt that the definition of “in play” gets at is a situation in which the property is not for sale — at least not at first.A Globe sale would not be a classic takeover, with stock being bought and sold and hostile moguls forcing their way onto the Times Co. board. The Sulzbergers have insulated themselves from that with their two classes of stock. But, as I said in an earlier comment, the Sulzbergers might be pressured to the point at which they decide to sell.I’m not sure how you got going on this, but you’re off.
mike_b1
Do you lecture your class like you lecture me? Get in the real world. The Globe’s not in play until the Sulzbergers decide it is. The stock closed today at $23.62, much closer to its 52-week low ($21.54) than to its 52-week high ($29.49). Today, so many people were so hyoed on the Welch rumor that a whole 100,000 more shares were moved than the 3-mo. average. That’s a rounding error, not a trend.Dan, the market is ignoring the gossip. There’s no “play” here.And the Times board has a legal fiduciary obligation to their shareholders and strict limits on what they can say and do in these matters. And nothing they have said publicly indicates they have any interest in moving the Globe.
Dan Kennedy
Mike! You’re changing the subject! You started off by falsely claiming I had said the Globe was for sale — “after making the bold assessment that the Globe is in play (for sale).” I never said any such thing. If my students were to mischaracterize something I wrote so blatantly, you are damn right I would lecture them.The Globe is indeed in play, that’s not the same thing as being for sale, and that’s the end of it. And other than your obstinate insistence that “in play” and “for sale” mean the same thing, I actually agree with most of what you say.
Anonymous
Boys, boys! Keep this up and Callie Crossley will lecture to you both!