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Is the Grey Lady on Life Support? (update)
Posted by: McQ on Wednesday, November 12, 2008

Scholars and Rogues has a very interesting and in-depth look at the shape the NYT company is in. It's not particularly good. In fact, it is fairly critical. It must deliver $400 million to lenders in May of 2009. Unfortunately it is in no real shape to do that:
What NYTCo. has:
• $46 million of cash
• $366 million owed to it by advertisers
Total: $412 million

What NYTCo. owes:
• $398 million of short-term debt (due in May)
• $161 million of accounts payable (newsprint, travel, etc.)
• $100 million of payroll (salaries)
• $159 million of other expenses
• $50 million owed on long-term debt and rent
Total: $865 million

Bottom line, short term: NYTCo. owes $453 million more than it has.
It is reported to have a $366 million line of credit which may or may not be available if it calls on it. Its credit rating has been reduced to "junk" and its once well performing stock is in the toilet.

Much of this has to do with an outdated business model and an apparent inability to modify it to reflect the reality of the changing market. The timing of its financial woes couldn't come at an economically worse time.

It wouldn't at all surprise me though, if the Democrats, given how important the NYT has been to them lately, might not see the paper as "too big to fail".

UPDATE: Heh ... Soccer Dad turns me on to this.
 
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Previous Comments to this Post 

Comments
pedro sez it’s never too early to bellyache. so what if the complaint du jour never comes to pass, fuggedaboutit and complain about something else!

pedro feels that the mythical bailout of the grey lady would be a bi-partisian affair. it would have been much harder to launch that needless war w/o her help.
 
Written By: pedro the illegal alien
URL: http://
That will be awesome to watch Harry Reid arguing to bailout NYT! And if he can’t bail them out, he will at least be able to use the NYT hardship to reinforce the case for the "Fairness doctrine."
In an indication of how bad things may be at NYT:
"Vivian Schiller, head of the digital arm of The New York Times, will be National Public Radio’s new chief executive."
http://www.forbes.com/media/2008/11/11/schiller-nyt-npr-tech-cx_pco_1111paidcontent.html


ship/rats/leaving
 
Written By: Mal Gusto
URL: http://
Rupert Murdoch, call your office.
 
Written By: Bithead
URL: http://bitsblog.florack.us
A bailout is not all that far fetched, I would suggest it’s even very likely. NYC might even go further into bankruptcy to help them.
After all, politicians help their big contributors, that’s just the way it is.

I don’t feel like searching for it, but the details of how they got their shiny, new building for far below market value are pretty bad.
 
Written By: Veeshir
URL: http://
My fondest dream (that doesn’t involve women!) is to see that paper fail and the journos forced to work in the service sector
 
Written By: shark
URL: http://
shark,

They can’t work in the service sector. I predict government or teaching.
 
Written By: Harun
URL: http://
It hardly even matters if they get a bailout. They’re losing money so fast, at a rate that has done nothing but accelerate, that they’d still be gone in a year or two.

The auto companies actually have a plausible story about people buying cars when the economy improves. The New York Time’s story is not plausible; they were bleeding before the economy turned south, they’re bleeding now, they’ll still be bleeding when it comes back.

(I mean, yes, I don’t want my tax money going there; my point is that it still can’t save them.)

It’s actually a prime example of the "moral hazard" of these bailouts. No future outcome of the NYT is improved with "free money" and many are worse.
 
Written By: Jeremy Bowers
URL: http://www.jerf.org/iri
They can’t work in the service sector
Why not? They serviced Obama constantly the last 20 months...
 
Written By: Scott Jacobs
URL: http://
Why not? They serviced Obama constantly the last 20 months...
The Bukkake times:)
 
Written By: capt joe
URL: http://
My fondest dream (that doesn’t involve women!) is to see that paper fail and the journos forced to work in the service sector
I’d avoid any fast food joint they work at.
 
Written By: Don
URL: http://
it would have been much harder to launch that needless war w/o her help.
Haiti or Kosovo?
 
Written By: Don
URL: http://
Don, I think he means the Spanish/American war.
 
Written By: Veeshir
URL: http://
I don’t know where I read it, but this idea doesn’t feel totally original:

Some philanthropist or group of philanthropists should just buy up the company, cover its losses, turn it into a real newspaper, and consider it a public service. They could have an independent team of ideologically diverse auditors judging the editorial policies and the text itself, to make sure it didn’t become a political advocacy journal.

They could get some real diversity on the opinion pages (instead of a token conservative) and have ’em go at it. Then at least it would be interesting.
 
Written By: Bryan Pick
URL: http://www.qando.net
They could try a different business model. Report all the facts and let the readers decide.

They’d rather be bankrupt.
 
Written By: MarkD
URL: http://
I blame Bush.
 
Written By: Obamarationalizer
URL: http://
Can anyone figure the gap between the moral bankruptcy and the economic bankruptcy?
 
Written By: BlogDog
URL: http://www.pugsofwar.blogspot.com
it would have been much harder to launch that needless war w/o her help.

Haiti or Kosovo?

Written By: Don
URL: http://
Don, I think he means the Spanish/American war.
Naw, he means the war on poverty. The NYT was invaluable on that one.
 
Written By: kyleN
URL: http://impudent.blognation.us/blog
I don’t think they are losing money just because they are left-wing, but because the Newspaper business as a whole is being killed by the internet. I am not sure just making it "fair and balanced" would actually help that much.
 
Written By: Harun
URL: http://
No, but making it high-quality information—the kind you can’t get just by looking at press releases and asking the most generic of questions—would add value, and being in an ideological echo chamber tends to degrade the quality of information.
 
Written By: Bryan Pick
URL: http://www.qando.net
I am not sure just making it "fair and balanced" would actually help that much.
It’s true that the newspapers are losing big chunks of revenue and mindshare to the internet. However, given this pressure how much sense does it make for newspapers to alienate half their potential readers?

I know a number of people who follow the news closely and used to subscribe to papers and magazine but have intentionally canceled their subscriptions.
 
Written By: huxley
URL: http://
At last we have found our silver lining!
 
Written By: ZF
URL: http://
Huxley is correct. The NYT and other MSM outlets have been alienating a large percentage of their potential customer base for years, conservatives. Those conservative potential customers actually want to see them fail.

It is truly astounding to find most of an industry, the MSM, essentially calling about 1/2 of its potential customers "idiots" or worse. Yet the MSM does that every day.
 
Written By: maxwell
URL: http://
harun, you are wrong. I’m one who has cancelled all newspaper and magazine subscriptions and watch no TV news whatsoever. Yet I am always up-to-date on news, I just refuse to support the in-the-tank crowd with my $$ or my eyes.

I’d like to see the NYT go belly up and the Sulzbergers living on the street. We can’t always get what we want...
 
Written By: Peg C.
URL: http://
Suppose Putz Sulzberger gets his wet dream and a bailout.

Suppose the Dems get their wet dream and institute the Fairness Doctrine.

Given public ownership in the NYT, wouldn’t the Fairness Doctrine mean that he’d have to give balance coverage?

Just contemplating being forced to do non-partisan reporting is enough to make Putz’s head explode, not to mention most Dems.

 
Written By: nerdbert
URL: http://
Peg C. is right. JOIN HER IN THE REVOLUTION.

Cancel all print and cable subscriptions for a year (or more if you like). If a large number of subscribers do this at one time, OUR VOICE WILL BE HEARD. Be sure to tell service providers why you ar cancelling. Donate savings to charity, favorite politcal cause, or SAVE IT.

Avoid buying anything necessary. See how fast Liberal Democrats and Screaming Lefts can rescue the economy created by themselves. Let them do it on their own. Yeah, right!
 
Written By: peaceatlast
URL: http://
The internet and other free media may very well be killing the NYT and other big-city dailies, but what kind of business is it that in the face of declining demand goes out of its way to ignore, insult and abuse half of its customers?
 
Written By: Rick Z
URL: http://
The NYT does have interests in its building in NYC and the Boston Red Soxs baseball team. Both holdings are substantial but illiquid.
 
Written By: one
URL: http://
Can we watch the NYT fail?

Yes, we can!
 
Written By: Occam’s Beard
URL: http://
HOW is this happening ?
don’t the millions of libs support their own daily newspaper ?
Anyway,the day they close down will be celebrated in here .
Couldn’t happen to a more deserving business.
 
Written By: salome
URL: http://
Just contemplating being forced to do non-partisan reporting is enough to make Putz’s head explode, not to mention most Dems.
I wish, but most journalists and Dems believe that while theoretically there may be some minor bias in the MSM, basically the MSM’s reportage is non-partisan and objective.
 
Written By: huxley
URL: http://
It actually wasn’t the loss of mindshare that hit NYT, it was a loss of advertisers. Between Craigs List, Monster, etc., there is really little need for most advertisers to give their advertising revenues to Pinch Salzburger. Moreover, the Times was and remains a very poorly run business.
 
Written By: Bill Dalasio
URL: http://
I bet George Soros will keep the Times afloat, if he’s not already in the mix.
 
Written By: Greg Toombs
URL: http://
New NYT business model: Burgers and fries.
 
Written By: Skip
URL: http://

New York Times has become nothing more than a mouthpiece for anti-American propaganda. They don’t need a bailout, they need to get out of the radical left wing of the Progressive/Socialist Party that sold out the country for the sake of an election.


Click here: YouTube - Timeline shows Bush, McCain warning Dems of financial mess
 
Written By: Mickey
URL: http://
New York Times has become nothing more than a mouthpiece for anti-American propaganda. They don’t need a bailout, they need to get out of the radical left wing of the Progressive/Socialist Party that sold out the country for the sake of an election.

 
Written By: Mickey
URL: http://
The NYT company cannot be bought without the Sulzbergers’ blessing because of their two-tier stock ownership arrangement, and they’re not about to sell. But it would be nice if Rupert or someone would publicly put a low-ball but serious offer on the table to buy the company. Then, when Pinch goes to Washington looking for taxpayer dollars, opponents could at least point out that there is a private offer on the table and they could take that rather than public money. It might not stop Obama/Pelosi/Reid from coming to the aid or an important organ of the Democrat Party but it might hurt them in the PR war.
 
Written By: Paul Schlick
URL: http://
Their situation is bad but not quite as bad as the numbers given indicate.

The short term debt due in May can be rolled over - i.e. not paid or postponed (take your pick).

I doubt they owe $100M in salaries. It could however be unfunded pension obligations. Even five thousand employees at $3000/week is only $15M.

But that still leaves a miserable cash situation.

The NYT is a paper that loves to pour undiluted misery on ninety percent of America. With that coming back I can’t be sad.

They aren’t going away soon, or soon enough. I’ll stop rather than add to that.



 
Written By: K
URL: http://
it would have been much harder to launch that needless war w/o her help.
Haiti or Kosovo?
Not to mention it would have been much easier to win the necessary Iraq War without her constant undermining and ankle-biting.
 
Written By: Achillea
URL: http://
I am proud to hasten their descent. Everytime they send me subscription notice i return in empty. only costs them a couple bucks, but makes me happy.
 
Written By: Gamecockjerry
URL: http://
K:

The payroll does not sound that far off. They have 10,230 employees as of last report — twice your estimate which means $30 million. Also, I would guess that their average pay including associated costs is around $5-$6k per month. So double your estimate again to $60 million.

I am sure there are a few stars and senior management making in the mid-six figures that account for the rest.

Also, don’t forget the print and drivers union members.
 
Written By: dcpi
URL: http://
More than likely, the NYT is already scheduled for some of the $700 Billion Bailout as We the People don’t get to see who is actually bailed out due to Paulson’s Un-Transparency.
 
Written By: Ratt
URL: http://
The Dems can’t bailout NYT. I mean, some may want to try but the it’s going to awfully hard to justify to the American people using their tax dollars to fund a non-essential left-wing New York newspaper. I hope Reid tries cause he’ll look as stupid as he did when he stood up and said the war was lost.
 
Written By: Phil
URL: http://

NYT is like the public educational system. It causes more harm than good.

Good riddance.
 
Written By: John V
URL: http://hellobirdy.blogspot.com/
Not that I’m a leftist, but a plausible business strategy for the NYT is to go ahead, admit its leftist bias, give up any pretense of objectivity, and become a highbrow advocate of leftist causes and left-slanted news coverage, like the Guardian in the UK - along with its cultural coverage and other content that targets affluent, hyper-educated, big-city intellectuals. It’s about 99% there now, but it’s burdened by its notion of trying to be the "newspaper of record".

Personally, I like honest bias over fake "objectivity", since a truly objective report on pretty much anything is nearly impossible to execute. I’d probably read the NYT more if it were honestly leftist.
 
Written By: Foobarista
URL: http://

 
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