The New York Times has won five Pulitzer prizes for its journalism today [Guardian.co.uk], but over the last year or so the share price has tanked. It seems that winning a Pulitzer doesn’t cover the cost of well…winning a Pulitzer
While we should celebrate the Times‘ continuing success as a newspaper of record, despite some serious upfcuks in the past (Jayson Blair, Judith Miller), we should also perhaps be preparing an obituary for the style of reporting that helps the paper be consistently one of the world’s best.
IN 2010 maybe the headline will be “Google wins 5 Pulitzers for re-assigned New York Times staff”.
Writing in the April edition of Vanity Fair, Mark Bowden notes that the Times company – owned and run by the Ochs Sulzberger family for three generations – is saddled with debt and a stonkingly horrible share value of around $3.50, down from more than $50 at its peak in mid-2002. This graph from Crossing Wall Street says it all really.
According to Bowden’s story, the paper is in real trouble and may well be on the market soon. He seriously suggests that Google might be an interested buyer, but Rupert Murdoch may well, despite denials, also be a bidder. [The Inheritance, VF April 2009]
The share price is less than the cover price ($4) of the NYT Sunday edition, down 93% from the glory days. In 2008 ad revenue at the paper fell by14.4% [News Busters]
It seems that Arthur Ochs Sulzbergr Jr, the current incumbent in the publisher’s chair may well be the last of the dynasty. Mark Bowden lays it on the line:
While the crushing forces at work in the newspaper industry are certainly not Arthur’s fault, and many other newspapers have already succumbed to them, the fate of The New York Times is of special importance: it is the flagship of serious newspaper journalism in America. The Times sailed into the economic storm that began in 2001 in good financial shape, bearing the most respected brand name in the profession. It was far better equipped than most newspapers to adapt and survive. What is increasingly clear is that the wrong person may be at the helm. Arthur Sulzberger’s heart has always been in the right place, but he assumed leadership from his father uniquely ill-equipped for this crisis—not despite but because of his long apprenticeship.
A piece in the New York Magazine from October 2008 explains some of the history; Arthur spent $3 billion buying back NYT stock in an attempt to retain and grow the Sulzberger’s family control. It back-fired horribly, the company’s not even worth $3 billion today.
First, there was Sulzberger’s decision to use the paper’s excess cash flow when it was making money in the nineties to buy back stock—a practice meant to improve investor confidence—instead of acquiring new properties that could have hedged against print losses. In the last decade, the Times bought back $3 billion of its own stock—more than the company’s present market value. Now that money is gone, and the company has sunk from surplus to deficit. (Sulzberger himself has acknowledged that the buybacks were “the stupidest thing” he’s done.) [Bleeding Times’ blood]
So are we approaching the end of an era? It seems plausible to suggest that the NYT will not win any more Pulitzers. They are expensive and require a well-resourced newsroom and a commitment to costly investigative reporting. In order to save the dying giant, the management has been on a cost-cutting spree. Of course, the first place that feels the knife is the newsroom.
A very recent memo [15 April 2009] from the Times‘ executive editor Bill Keller was leaked to rival paper the New York Observer, it makes chilling reading. Several sections of the paper are being abandoned and freelance budgets slashed. You can read the whole memo at the Observer, but this closing stanza seems to hold out bleak prospects:
The hope and expectation remain that the pay cuts and the spending cuts outlined above will get us through the year without the need for other significant reductions. As I have said on past occasions, there is nothing sacrosanct about the current size of the newsroom, but if the day comes when we decide to undertake a cut in the staff it should be driven not by the temporary crisis of a recession, but by a careful calculation of our long-term priorities.
In the meantime, the world continues to deliver up a rich bounty of news, and we have been covering it with a level of journalism that demonstrates, every day, why we matter.
Maybe the NYT won’t matter for much longer. That would be a real shame, but it seems that the grim scenario played out recently at the NYT is a template for the future of newspapers.