Tag: New York Times Co.

Could members of the Boston Newspaper Guild wind up as co-owners of the Boston Globe? A Media Nation reader sends along this link from the Financial Times. The story, posted last Thursday, doesn’t seem to have gotten a lot of pick-up.

But according to an anonymous source, one of the potential buyers, Boston Celtics co-owner Stephen Pagliuca, is reportedly willing to work out some sort of deal with the Guild that would result in employees owning a share of the paper. As the Financial Times notes:

Working with the Boston Newspaper Guild could help remove one of the biggest obstacles to a deal — negotiating a reduction in operating cost that could prove prohibitively expensive to return ownership to local control.

Such an arrangement would be similar to the one recently struck in Maine involving the Portland Press Herald and several smaller papers. Employees now own 15 percent of the company.

Boston Newspaper Guild president Dan Totten released an optimistic statement late this afternoon: “The Boston Newspaper Guild continues to have productive discussions with the New York Times Company and Globe management. We feel we are close to reaching an agreement that we can bring to Guild members for a vote.”

A vote has been scheduled for July 20.

With the New York Times Co. and the Boston Newspaper Guild scheduled to resume negotiations today over $10 million in union givebacks at the Boston Globe, the Times’ Richard Pérez-Peña weighs in with some insights.

His lede, focusing on the Guild’s alleged failure to keep its members apprised of what’s been going on for the past year, is telling, and helps explain why talks between the two sides went off the rails this spring. Even political reporter Brian Mooney, who was outspoken in his support for a “no” vote several weeks ago, says, “It wouldn’t have been that hard to make this go a lot better. There’s plenty of blame to go around.”

Yet there are three questionable assertions in Pérez-Peña’s story. One isn’t that important, but two are. Those assertions pop up in one sentence about halfway through the story:

Throughout the long process, the company has publicly said little about the situation, and to this day it has not confirmed last year’s loss, or acknowledged that it had threatened to close the paper.

I’ll deal with the threat to close the paper first. From the moment on April 3 that news outlets began reporting that the Times Co. was threatening to close the Globe unless the paper’s dozen or so unions could come up with $20 million worth of concessions, it was a little unclear precisely where that shutdown threat was coming from.

I’m not going to try to trace it back to the beginning, though, because I don’t have to. Times Co. spokeswoman Catherine Mathis confirmed it, in an on-the-record e-mail to the Phoenix’s Adam Reilly, on June 4. Reilly had asked Mathis why, in the weeks leading up to the “no” vote, talk about a possible shutdown had seemingly stopped, and whether management had in fact taken that option off the table.

Mathis responded: “Closure is a very real path for the Company to take.” So there you have it: a declarative sentence in which a top Times Co. official, speaking on the record, asserts that the company might shut the Globe if it fails to obtain the concessions it has demanded.

As for the Globe’s losses, Pérez-Peña specifically refers to “last year,” when, it has been reported, the Globe lost an estimated $50 million. As with the closure threat, it is hard to find a statement in which that $50 million figure has been directly attributed to an identifiable Times Co. official — or, in most cases, attributed to anyone at all. Maybe one exists, but I couldn’t find it.

Still, there doesn’t seem to be much doubt that management has, in fact, been telling Globe employees that the paper lost $50 million last year. For instance, consider this, from an April 9 Globe story by Robert Gavin:

Without the union concessions and other cutbacks, the Globe is projected to lose $85 million this year, following a loss of about $50 million last year, according to an employee briefed on union discussions.

But it seems to me that the more important figure is the $85 million. Here, too, the company itself has been less than forthcoming — so much so that a few people warned me early on that I should be clear that the origin of that number was suspect.

Fortuitously enough, though, the $85 million figure shows up in the Times Co.’s most recent quarterly report to the Securities and Exchange Commission, filed on May 7. Here’s the language:

Before savings from changes to the union agreements or other cost-cutting initiatives or the effects of any revenue initiatives, we projected that 2009 operating losses at the Globe and Boston.com would be approximately $85 million.

Finally there is the small matter of Pérez-Peña’s claim that “[t]he Globe’s troubles did not explode into full view until April 3, when its Web site, Boston.com, posted an article reporting that the Times Company had threatened to shut the place down unless unions agreed within 30 days to major concessions on wages.”

Maybe it depends on your definition of “full view.” But, in fact, WBUR Radio (90.9 FM) broke the story on its Web site on April 3, followed a very short time later by the Phoenix’s Reilly, who reported both the $20 million giveback demand and the closure threat.

It’s impossible to ascribe motive when doing this type of analysis. And I suppose these discrepancies don’t add up to a whole lot. But, inevitably, when the Times covers the Globe, every sentence and phrase is going to be scrutinized.

“Beat the Press” blogger-in-chief Ralph Ranalli writes that Boston Globe staffers are now “cautiously optimistic” that the New York Times Co. and the Boston Newspaper Guild will come to an agreement in renewed talks, which resume next week.

And Ranalli asks an excellent question: How can the Times Co. stick to the 23 percent pay cut — based on its contention that the two sides are at an impasse — when management and the Guild are actively engaged in bargaining sessions?

Depending on how things go, this could be a very big day for the future of the Boston Globe and its employees. The Newspaper Guild is sending in its national president, Bernie Lunzer, to try to work out an alternative deal with New York Times Co. management. (Boston Herald coverage here; Globe coverage here.)

It’s easy to say the Times Co. is going to stick with the 23 percent pay cut it imposed last week, but there are reasons to think that management would be amenable to negotiations. Management’s chief aim is to extract $10 million in concessions from the Guild, and to do it in a manner that paves the way for selling the paper.

The 23 percent pay cut accomplishes the first goal but not the second, since the Times Co. is now dealing with building full of seething employees. And about 190 Guild members still have lifetime employment guarantees, which will make it more difficult for a new owner to do the sort of drastic restructuring that’s needed.

It wouldn’t surprise me if the two sides reach an agreement that looks quite a bit like the one that was narrowly rejected last week: a pay cut of around 10 percent; cuts to retirement and other benefits; and an end to the lifetime job guarantees. If Times Co. executives have any sense at all — a debatable proposition at this point — then they will sweeten the pot a little bit so that Guild members can feel that they actually got something out of last week’s “no” vote. As long as it adds up to $10 million, then it really doesn’t matter.

New York Times columnist David Carr today, meanwhile, checks in with a group of outside analysts to try to put a price tag on the Globe. It proves to be a futile exercise, as the prices range anywhere from $250 million to the Times Co.’s actually having to pay a new owner as much as $25 million to make the Globe go away. Nor does the longer online version add much.

The takeaway quote comes from the venerable analyst John Morton, who writes to Carr:

Should a private buyer be found I suspect that any Globe employees still employed after the deal goes through will recall the contract they have just rejected as paradise compared with what a new owner will impose in cost-cutting.

Times Co. executives have behaved badly enough through this crisis that it’s easy to forget the larger truth: the newspaper business is coming apart at the seams, and what’s happening at the Globe is no different from what’s happening to major metropolitan dailies across the country. Morton’s assessment is a reminder of that reality.

There’s an ugly symmetry to the news that the New York Times Co. is soliciting bids for the Boston Globe.

Having paid $1.1 billion for the Globe in 1993, half the market capitalization of the entire Times Co., the Sulzberger family may now find there is virtually no interest in what once once its second-most-prized asset after the Times itself.

After the Boston Newspaper Guild narrowly rejected a proposal to cut salaries by about 10 percent and eliminate about 190 lifetime job guarantees, the Times Co., as expected, imposed a 23 percent pay cut. And the Guild, as expected, has appealed to the National Labor Relations Board.

What’s unclear today is the status of the lifetime job guarantees, widely thought to be a major stumbling block to any effort to sell the paper. Today’s Globe story, by Keith O’Brien, isn’t quite as explicit as I’d like it to be, but the gist seems to be that the guarantees remain in effect at the Guild — at least for the time being — and the paper’s other unions have given them up.

In the Boston Herald, Jay Fitzgerald and O’Ryan Johnson interview Poynter Institute business analyst Rick Edmonds, who wrote an excellent post the other day suggesting that the Globe was closer to break-even than is generally assumed.

Edmonds tells the Herald that the lifetime guarantees and the ongoing labor crisis remain major stumbling blocks to a sale: “Having these different things going on makes it considerably harder, if not impossible, to sell this newspaper.”

So says Poynter Institute business analyst Rick Edmonds.

In a revealing post — made all the more interesting following the Boston Newspaper Guild’s narrow defeat of a package designed to save the New York Times Co. about $10 million — Edmonds reports that Times Co. spokeswoman Catherine Mathis has clarified some of the murk. (Via David Folkenflik.)

Edmonds writes that the $85 million operating loss the Globe is said to be ringing up in 2009 actually “includes depreciation, amortization and special charges.” His best guess: the Globe is on track to lose about $20 million this year, and the concessions demanded by the Times Co. would roughly cover that.

Of course, following today’s Guild vote (the deal lost by a heart-stopping margin of 277-265) management only has $10 million in hand, in the form of concessions agreed to by unions other than the Guild. Management has threatened to impose a 23 percent pay cut, which the Guild, in turn, says it will appeal to the National Labor Relations Board.

It’s impossible to know what’s going to happen next, at least not tonight. But one thing that ought to be acknowledged is that the folks at 135 Morrissey Blvd. have continued to put out a very good newspaper despite months of uncertainty, even chaos, with respect to the Globe’s future. I’m sure that will continue.

Update: The Globe itself made some of the same points on April 24, though Edmonds’ main argument — that the paper’s true operating loss this year is likely to be $20 million — doesn’t quite emerge.