I’m genuinely puzzled by all the praise this Gene Weingarten column in The Washington Post has received. Not that the collapse of the news business is Weingarten’s fault, but I’m put off by the finger-wagging, lecturing tone — the exemplar of a failed industry presuming to instruct the visionary who just might save his job. Just listen to us, Jeff, and you’ll be fine! I assume Bezos will not take his advice.
Month: August 2013
Muzzle winner gets its final comeuppance
How sleazy do you have to be before you’re found to lack the morals necessary to operate a slots parlor? Very sleazy indeed. Mark Arsenault of The Boston Globe reports that former Plainridge Racecourse president Gary Piontkowski’s habit of stuffing cash into his pockets — $1.4 million in total — was just too much for state regulators to overlook.
Last month, we bestowed a 2013 WGBH News/Portland Phoenix/Providence Phoenix Muzzle Award upon the racetrack for its unsuccessful attempt to abuse the libel laws in order to silence a local blogger who opposed a slots license for the Plainville facility.
And today, in his Boston magazine blog, David Bernstein lays out Piontkowski’s relationship with former senator Scott Brown.
None of this should surprise anyone. It’s simply what you get with large-scale organized gambling. No casinos. No slots.
A moment of optimism for the future of journalism
In just four days, a major metropolitan newspaper (The Boston Globe) and, now, a national newspaper (The Washington Post) have been sold to wealthy new owners with good-guy reputations who’ll be able to operate debt-free while they try to figure out how to turn around the fortunes of their beleaguered acquisitions.
John Henry’s buying the Globe is one thing. Jeff Bezos’ purchase of the Post is quite another. Post-Steve Jobs, is there a more visionary tech entrepreneur than the founder of Amazon? This is great and hopeful news for anyone concerned about the future not just of the newspaper business but of journalism.
“Papa Doug” minion squawks over Globe sale
A real bump in the road? Or just the Herald being the Herald when it comes to all things related to The Boston Globe?
Chris Cassidy reports in the Boston Herald that the group headed by Douglas Manchester, the right-wing businessman who owns the paper formerly known as the San Diego Union-Tribune, is squawking because its executives believe they offered more money for the Globe than Red Sox principal owner John Henry. Cassidy quotes John Lynch, the chief executive of U-T San Diego:
We bid significantly more than Henry. At the end of the day, I’m certain our bid was higher and could have been a lot more higher if they had just asked. I’m just stunned. I thought this was a public company that had a fiduciary duty to get the most by its stockholders…. From the beginning, I don’t think they wanted to sell to us.
Cassidy writes that the allegations “could delay the deal and leave the New York Times Co. open to shareholder backlash.”
Could they? No doubt we’ll learn more in the days ahead. One thing working in favor of the deal is that the Times Co. has two classes of stockholders, with the voting shares firmly under the control of the Sulzberger family and its allies. But that doesn’t mean the Sulzbergers are legally allowed to leave money on the table.
Last February, Boston Globe reporter Beth Healy wrote an article in which Times Co. vice chairman Michael Golden made comments that could be construed as at least somewhat contradictory. Here is how she began:
New York Times Co. vice chairman Michael Golden told Boston Globe employees Friday that the company has a duty to seek the highest bidder in a sale but aims to leave the newspaper in responsible hands.
“We have no intention to send the New England Media Group to the slaughterhouse,” he said in one of three town-hall style meetings with employees.
One way of interpreting that is that the Times Co. would select the highest qualified bidder — language often invoked so that (for example) a city council isn’t legally bound to award the trash-hauling contract to the low bidder if it turns out that he plans to burn it all in his backyard. Or that the Times Co. would be required to sell to the likes of “Papa Doug” Manchester.
In today’s Globe, Healy reports that, ultimately, what fueled the Henry bid was a lot of green, which may be what prevents the Manchester group’s complaints from rising to the level of seriousness. She writes:
His [Henry’s] was not the highest bid for the Globe, according to people involved in the process. But his offer was appealing to the Times Co. because it was cash, unencumbered by financing issues or a bevy of investment partners. One executive working for the Times Co. said the key was who was best able to get the financing together and close the deal relatively quickly.
It sounds like Times Co. chairman Arthur Sulzberger Jr., if pressed, will be able to make the case that he sold not just to the buyer most likely to preserve the Globe, but also to the one who was the best prepared to sit down and write a check. Money talks.
Some pressing questions for John Henry
This commentary was published earlier at The Huffington Post and at WGBH News .
The speculation had been building since Wednesday, when The Boston Globe reported that Red Sox principal owner John Henry had restructured his bid to buy the paper.
It reached a peak on Friday afternoon, when legendary baseball reporter Peter Gammons — himself a Globe alumnus — posted a one-line item on his new website, Gammons Daily: “A source says the New York Times Corporation has chosen John Henry as the new owner of the Boston Globe.”
Confirmation came early today, as the Globe and The New York Times each reported that Henry had purchased the Globe and its associated properties — most prominently Boston.com and the Telegram & Gazette of Worcester — for $70 million. The Globe’s story led page one, whereas the Times’ version apparently didn’t even make it into today’s print edition.
The sale price represents a huge comedown from 1993, when the Times Co. purchased the Globe for $1.1 billion, half the company’s stock-market valuation at that time. As if by way of justification, the Times’ report on the Henry deal runs through several other pennies-on-the-dollar sales of major metropolitan newspapers in recent years, including those of Philadelphia’s daily papers, the Inquirer and the Daily News, as well as The Tampa Tribune.
Henry’s winning bid also thwarts an attempted comeback by members of the Taylor family, who owned the Globe almost from its founding in 1872 until the 1993 sale.
Among the would-be buyers was a group that included Stephen Taylor, a former executive vice president of the Globe, and Benjamin Taylor, a former publisher. A lot of people in Boston were rooting for the Taylors. But the money they got for selling the paper 20 years ago was split among dozens of family members, and their bid to repurchase the Globe was widely viewed as undercapitalized. You have to assume that if they had the money, the Times Co. would have sold it to them already — or in 2009, when the Globe was first put up for sale.
The ascension of a wealthy local owner may represent the best possible outcome for the Globe. Nevertheless there are questions Henry will have to answer soon — starting with the fate of publisher Christopher Mayer and editor Brian McGrory, well-liked Globe veterans who generally get high marks for the way they’re running the paper. Will they stay? Or will Henry bring in his own people?
Here are a few other questions for Henry.
1. Will he seek to improve the Globe’s bottom line by investing — or by cutting? Unlike newspaper owners who’ve financed their acquisition by taking on debt that they then have to pay off by slashing the newsroom, Henry has the luxury of being able to do anything he wants.
Although paid print circulation and advertising revenue have been dropping, the Globe is believed to be marginally profitable — a considerable improvement over 2009, when the Times Co. actually threatened to close the paper over mounting losses. The Globe today also has about 360 full-time editorial employees. That’s quite a drop from the 550 or so the Globe employed a dozen years ago, as my WGBH colleague Adam Reilly recently reported in Boston magazine, but it’s still enough to make the paper by far the largest news organization in Eastern Massachusetts. The Globe may no longer be the 800-pound gorilla, but a 600-pound gorilla can still accomplish a lot.
My guess (and hope) is that Henry will pursue a growth strategy, and that he has a healthy enough ego to believe he can succeed where others have failed. Perhaps he’ll emulate Aaron Kushner, the young greeting-card executive (and onetime Globe bidder) who’s attracted attention with his attempts to turn around the Orange County Register by hiring journalists and expanding coverage.
One aspect of Kushner’s stewardship I hope Henry doesn’t emulate is Kushner’s emphasis on print. The Globe has taken an innovative approach to the Internet with its two-website strategy (Boston.com, which is free, exists alongside the paid BostonGlobe.com site), a streaming music station, RadioBDC, and online coverage of Boston’s suburbs, neighborhoods and colleges through its Your Town and Your Campus sites. (Disclosure: Our students at Northeastern University contribute to Your Town and Your Campus as well as to other parts of the Globe.)
Henry could be a hero to the newspaper business if he can figure out new digital strategies. A print-first orientation would be a major step backwards.
2. What happens to the Globe’s Boston headquarters? The Globe occupies prime Dorchester real estate near the University of Massachusetts and the JFK Library, leading to considerable speculation that the next owner might want to sell the property and move the paper. Indeed, the Globe’s land and physical assets might be worth the $70 million purchase price all by themselves.
The challenge is that the Globe’s massive printing presses would have to be moved. And the paper has been able to build a nice business for itself by printing a number of other papers, including the city’s second daily, the Boston Herald, as well as some suburban papers.
Still, it would make all kinds of sense to move the presses to a low-cost exurban location and transfer the newsroom and business operations to a smaller space closer to the downtown.
3. How will the Globe cover the Red Sox? The jokes have already started (yes, I’ve done my best to help) about Globe sports columnist Dan Shaughnessy, a notoriously negative presence who wrote former Red Sox manager Terry Francona’s trash-and-burn memoir Francona: The Red Sox Years, which is highly critical of the Red Sox’ ownership.
In fact, the Globe and the Red Sox have been down this road before. Until a few years ago, the Times Co. was a part-owner of New England Sports Network (NESN), which broadcasts Red Sox and Bruins games and whose majority owner is the Red Sox. Henry’s sole ownership of the Globe, though, would represent full immersion in a way that the NESN deal did not.
The real issue is not how the Globe covers the Red Sox as a baseball team but rather how it manages the tricky task of reporting on a major business and civic organization that’s run by the paper’s new owner.
Earlier this year the Globe published a tough report on a sweetheart licensing deal the Red Sox have with the city to use the streets around Fenway Park before games — making “tens of millions of dollars” while “paying a tiny fraction in licensing fees.” (Further disclosure: Some of the Globe’s reporting was done in partnership with Northeastern’s Initiative for Investigative Reporting.)
I’d expect to see tough scrutiny of how the Globe covers the Red Sox in the months and years ahead. No doubt the Herald and other rival news organizations will pay close attention to the relationship. The problem isn’t so much that the Globe is likely to go into the tank for the Red Sox (it isn’t), but that it’s really in a no-win situation.
The answers to those and other questions will emerge in the weeks and months ahead. What matters today is that our largest and most important news organization has been purchased by a local businessman with deep pockets and a track record as a good corporate citizen. That’s good news not just for the Globe, but for all of us.
Photo (cc) by Dan Kennedy.
While we wait for the John Henry announcement
We’re all waiting for confirmation of Peter Gammons’ report that the New York Times Co. will sell The Boston Globe to Red Sox principal owner John Henry. Gammons’ tidbit broke too late for “Beat the Press.” But in Rants and Raves, I talked about why a sale to Henry made sense. You can watch it above.
How’s that trade working out? (XX)
The story isn’t online, but here’s a teaser from the new issue of Sports Illustrated:
STILL KICKIN’ IT
He was once the unlikeliest of idiots in a band of heroes that made history. Nearly a decade later, Bronson Arroyo is still standing, still chilling to his own beat, still one of the game’s most dependable innings-eaters.
I believe Wily Mo Peña played in Japan last year. Not sure what he’s doing this year.
Kindle edition of “The Wired City” now available
I got some great news on Thursday: The Kindle edition of “The Wired City” is now available at Amazon.com. I do virtually all my book-reading on my iPad using Kindle software, even if I have a hard copy — so I know how important it is to make “The Wired City” available electronically. Thank you for your patience.
Why John Henry’s bid for the Globe makes sense
Maybe it’s because this has dragged on for such a long time, but Beth Healy’s report that Red Sox principal owner John Henry has decided to make a solo bid to buy the paper and its associated properties carries with it the ring of inevitability.
He’s got the money, which has always been the big question about local favorites Steve and Ben Taylor. If they had the cash, the New York Times Co. would have sold it to them in 2009.
Henry doesn’t have any obvious flaws, like San Diego businessman “Papa Doug” Manchester. He’s even restructured his bid — possibly at the request of the Times Co.?
I wouldn’t be surprised to see Henry introduced as the next owner of the Globe sooner rather than later — possibly to be followed by an announcement that Dan Shaughnessy has accepted a job at ESPN.