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.
Could such an arrangement work with a large metropolitan daily such as the Globe?