Some readers apparently are worried that they might not have The New York Times (NYT) to kick around much longer.
The media outlet Americans love to hate is getting unsolicited offers of help from people worried that the Times might face the same financial calamity as the bankrupt papers in Philadelphia, or be forced out of business like Denver's Rocky Mountain News. "We have received letters and emails from readers concerned about what is happening with newspapers," said Times spokeswoman Katherine Mathis in an email to DailyFinance. "In their notes they say they would be willing to contribute to the Times because they so value the journalism we provide."
This is refreshing in a way. I wonder if people think they can hold bake sales and car washes to save the Old Grey Lady. Of course, there will have to be premiums to get people to donate. Might I suggest a calender featuring pictures of notable members of staff? Paul Krugman could be Mr. October, for example. They could auction of lunch with Frank Rich (though he would probably do most of the talking). Maybe Maureen Dowd would go bowling with a donor. Perhaps Nicholas Kristof would drink beer and play darts.
This is not as far-fetched as it seems.
One idea being floated to save newspapers is to turn them into non-profit organizations like NPR and PBS. The idea has some appeal because newspapers are becoming less profitable by the hour. Shares of The New York Times parent company are down 75 percent this year even when factoring in the recent run up in the stock market.
Like newspapers everywhere, the Times faces a double whammy of declining circulation and lower advertising revenue. Earlier this month, it netted $225 million from the sale-lease back of most of its swanky new corporate headquarters. The funds were used to retire $250 million in notes.
The New York-based publisher received a $250 million loan from Mexican billionaire Carlos Slim in January and suspended its dividend, which provided much of the wealth of the founding Sulzberger-Ochs family. Recently, it announced layoffs of 100 workers and a temporary five percent pay cut for most workers. Odds are growing that these temporary pay reductions will be permanent.
Time is not on the company's side. It has more than $1 billion in debt due over the next few years. Growth in internet advertising, which once gave newspapers a glimmer of optimism, is slowing. The four -- count `em four -- analysts who cover the company expect it to lose four cents in the fourth quarter. Revenue is forecasted to plunge 15.3 percent to $633.8 million.
Were it not for the Times' dual class stock ownership that allows the Sulzbergers to remain in control, the publisher would have been chopped up and sold off long ago. The Sulzbergers, who have done more than many to protect the First Amendment, can't wrap the company in bubble wrap and pretend the Internet never happened.
The Times proves that content is king of a shrinking kingdom.
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