Archives for 2009

Everyone seems to agree that we need save journalism as we watch newspapers slowly sink into insolvency.
Why? Mike Royko, the acerbic, blue-collar, Pulitzer-Prize-winning columnist for the Chicago Daily News put it best, I think, when he wrote that “a reporter is to a politician as a barking dog is to a chicken thief.” The country needs these watchdogs not only for politicians but also for businesses, Wall Street, and the climate.
Many newspapers, magazines, blogs, commissions, and even the government have taken up the question of saving journalism. One report, “The Reconstruction of American Journalism,” by former Washington Post Editor Leonard Downie, Jr. and respected newspaper historian Michael Schudson and sponsored by the prestigious Columbia University Graduate School of Journalism, is the most extensive research I’ve seen that has been conducted on the subject to date.
Downie and Schudson are basically optimistic, especially for local journalism, but they are less optimistic for hard-hitting, responsible investigative reporting on national issues and put forth some ideas and suggestions for preserving this important type of journalism. See this video interview with Schudson to get a summary of the report.
Here are my specific suggestions:

• Because The New York Times is the best and most important newspaper in the country, its survival must be addressed first.
• First, The Times must be wrested away from the Sulzberger family. How?
1. Bill Gates and Warren Buffet have to start things off by agreeing to put a $5 billion matching grant from the Gates Foundation into a new Journalism Preservation Foundation and then pressure other billionaires (Bloomberg, Murdoch, Redstone, Ted Turner, Page and Brin of Google included) to contribute to get the fund up to $10 billion.
2. Buy Carlos Slim’s $250 million loan to The Times by giving him 15 or 16 percent interest on his money. He’ll take the deal because he doesn’t care about the viability of The Times or journalism because if he did he would have given it a lower interest rate; he cares about the money – that’s how he got so rich.
3. Then, call in The Times’s loan as soon as legally possible, which will force The Times into bankruptcy.
4. When the paper is in bankruptcy, offer to buy out the Sulzberger family’s voting stock at a big discount and buy non-voting stock at pennies on the dollar. Investors who were dumb enough to buy non-voting stock in a company run by Pinch Sulzberger deserve to lose most of their money.
5. While the paper is in bankruptcy, get rid of current business-side management (Sulzberger, Robinson, etc.) and the many layers of bureaucratic management and hire bright, young professional managers who want to save journalism and are not interested in getting rich – make sure they live in Queens or Brooklyn where they can hobnob with the folks and not need to pay high rents.
6. Negotiate ruthlessly with the paper’s unions to get major concessions.
7. Renegotiate the contracts with all the editors, reporters, and columnists. It’s an honor to write for The Times and the top compensation should be $200,000 and contracts should be 360 contracts like the record companies are making with musicians in which the paper would get a percentage (40 percent?) of the speaking and consulting fees. Reporters, editors, and columnists wouldn’t get gigs without Times exposure, so the paper should get some of the action. If they don’t like the deal, they can try to get a job that pays more somewhere else – they could interview at Google, for example.
8. Charge $299 a year for online subscriptions to a complete version of the Web site and put a Times Lite version on the Web free and charge non-subscribers a per article fee for the heavy versions of articles.
9. Give students with an .edu e-mail address a 33 percent discount on subscriptions.
10. Charge readers who want to get the newspaper printed on paper and delivered the actual cost of each paper – if it’s $10 a paper, so be it. If they want their fingers smudgy, let them pay for it.
11. When The Times exits from bankruptcy, it will be a non-profit organization run for purpose of putting out great journalism, not for making a profit.

That’s a start. I’ll have some more ideas in Part II, but in the meantime, I’d like to hear your ideas on how to save journalism and The New York Times

Guest blogger Bruce Braun agrees with Michael Weiskopf on Obama’s decision to increase troops in Afghanistan and adds some points on why he thinks it was a bad decision.

Given that Obama, like Bush, Clinton, et.al are all career politicians, his actions should not be a surprise to anyone. Especially, if one has spent more than ten minutes examining the lists of broken presidential campaign promises.
No matter how seemingly sincere a candidate for the presidency may portray themselves on the campaign trail, once in office, campaign promise amnesia sets in about 30 seconds after being sworn in.
I disagree that Obama was elected by appealing to our “best instincts”. He was elected because of the intense hatred and backlash towards Bush and a joke Republican ticket. It helped that Obama was an attractive candidate, preaching a message of harmony and peace while evidencing how racial attitudes have changed along with a sophisticated campaign management team.
How much difference a year makes! For those of us who voted for Obama on the basis of his campaign rhetoric, we overlooked that first and foremost, he is a politician, like any other politician. Obama is the product of a political system and political class elites. And we forgot that like all politicians, they will say and do just about anything to get elected and to stay in power. We are then stuck with them for two, four or six years with free reign to do just about anything they want, with a blank check, courtesy of us, the US taxpayers. We allow them to gerrymander their districts in ways that essentially guarantees lifetime job security short of being convicted of felonies.
Do we really expect 100 senators and 435 members of the congress to ever come together in a bi-partisan way about anything? The only show of a modicum of unity we ever see, is when something like 9-11 takes place. And even then, all 535 of those elected representatives begin exhibiting amnesia within six months after an attack, about the blood they were demanding in revenge.
Our founding fathers crafted a Constitution and a Bill of Rights that was just six pages long and has been the foundation of our republic for almost 300 years. Now look what we have: Healthcare Reform, Obamacare, whatever you choose to call it, is over 2000 pages long and Title 26 or the US Tax Code runs 5.6M words!
We will never know what took place in the Afghanistan War discussions over the past 11 months, despite the campaign promises for greater transparency in government. Michael makes excellent points in his essay, especially in regards to who should have been invited to weigh in on the ramifications of potential decisions by Mr. Obama. However, original ideas such as Michael’s are not part of the psyche of our political class.
We have created a global geo-political welfare state over the past 60 years for almost every third-world conflict. Got a problem with your country or the country next to you? Call the US. They will send you billions and spill their young people’s blood for you, without question or accountability on your part. Are you ripping off and subjugating your citizens? Murdering them too? Not a problem. Exporting narcotics? No sweat. It is the American Way!
We need to face the reality that we do not have a two party system that works in and for the best interests of the citizens of this country. We have one party, the political class, that exists for the propagation of their interests. This is why Mr. Obama and the Congress makes the decisions they do and pisses away our hard-earned monies and sacrifices the blood of dedicated military.

Everyone seems to agree that we need save journalism as we watch newspapers slowly sink into insolvency.
Why? Mike Royko, the acerbic, blue-collar, Pulitzer-Prize-winning columnist for the Chicago Daily News put it best, I think, when he wrote that “a reporter is to a politician as a barking dog is to a chicken thief.” The country needs these watchdogs not only for politicians but also for businesses, Wall Street, and the climate.
Many newspapers, magazines, blogs, commissions, and even the government have taken up the question of saving journalism. One report, “The Reconstruction of American Journalism,” by former Washington Post Editor Leonard Downie, Jr. and respected newspaper historian Michael Schudson and sponsored by the prestigious Columbia University Graduate School of Journalism, is the most extensive research I’ve seen that has been conducted on the subject to date.
Downie and Schudson are basically optimistic, especially for local journalism, but they are less optimistic for hard-hitting, responsible investigative reporting on national issues and put forth some ideas and suggestions for preserving this important type of journalism. See this video interview with Schudson to get a summary of the report.
Here are my specific suggestions:

• Because The New York Times is the best and most important newspaper in the country, its survival must be addressed first.
• First, The Times must be wrested away from the Sulzberger family. How?
1. Bill Gates and Warren Buffet have to start things off by agreeing to put a $5 billion matching grant from the Gates Foundation into a new Journalism Preservation Foundation and then pressure other billionaires (Bloomberg, Murdoch, Redstone, Ted Turner, Page and Brin of Google included) to contribute to get the fund up to $10 billion.
2. Buy Carlos Slim’s $2.5 billion loan to The Times by giving him 15 or 16 percent interest on his money. He’ll take the deal because he doesn’t care about the viability of The Times or journalism because if he did he would have given it a lower interest rate; he cares about the money – that’s how he got so rich.
3. Then, call in The Times’s loan as soon as legally possible, which will force The Times into bankruptcy.
4. When the paper is in bankruptcy, offer to buy out the Sulzberger family’s voting stock at a big discount and buy non-voting stock at pennies on the dollar. Investors who were dumb enough to buy non-voting stock in a company run by Pinch Sulzberger deserve to lose most of their money.
5. While the paper is in bankruptcy, get rid of current business-side management (Sulzberger, Robinson, etc.) and the many layers of bureaucratic management and hire bright, young professional managers who want to save journalism and are not interested in getting rich – make sure they live in Queens or Brooklyn where they can hobnob with the folks and not need to pay high rents.
6. Negotiate ruthlessly with the paper’s unions to get major concessions.
7. Renegotiate the contracts with all the editors, reporters, and columnists. It’s an honor to write for The Times and the top compensation should be $200,000 and contracts should be 360 contracts like the record companies are making with musicians in which the paper would get a percentage (40 percent?) of the speaking and consulting fees. Reporters, editors, and columnists wouldn’t get gigs without Times exposure, so the paper should get some of the action. If they don’t like the deal, they can try to get a job that pays more somewhere else – they could interview at Google, for example.
8. Charge $299 a year for online subscriptions to a complete version of the Web site and put a Times Lite version on the Web free and charge non-subscribers a per article fee for the heavy versions of articles.
9. Give students with an .edu e-mail address a 33 percent discount on subscriptions.
10. Charge readers who want to get the newspaper printed on paper and delivered the actual cost of each paper – if it’s $10 a paper, so be it. If they want their fingers smudgy, let them pay for it.
11. When The Times exits from bankruptcy, it will be a non-profit organization run for purpose of putting out great journalism, not for making a profit.

That’s a start. I’ll have some more ideas in Part II, but in the meantime, I’d like to hear your ideas on how to save journalism and The New York Times

Guest blogger Michael Weiskopf goes after the NY Times for endorsing the Afghanistan buildup — a position I do not agree with, but one which a number of my friends and readers do, so I’m posting Michael’s comments:

Concerning The New York Times editorial endorsing the Afghanistan buildup and Peter Baker’s NY Timesarticle “How Obama Came to Plan for ‘Surge’ in Afghanistan,” I respectfully I disagree.
Mr. Baker’s story evoked the famous Yogi Berra line “It’s Déjà’ vu all over again.” By virtue of the culture lens of the NY Times,, once again the paper is playing the role of cheerleader for an administration’s generals as they beat the drums of war. While reading I checked the byline several times to see if Judith Miller was the writer.
Public support for any military action is essential in a democracy. The “Intelligentsia” also must be brought along, at least in the initial stages. And once again, the NY Times seems to understand and dutifully fulfill its role.
Baker’s article profiling the “lonely and difficult decision that the new president must face,” is a portrait of the corridor of power and of the agonizing decision and supports the notion that there is no alternative but to go forward with an escalation of violence. The article makes a persuasive case for war. If a free and critical press were truly at work, one might expect a bit more critical thinking and reporting of a decision that was apparently reached without the presence or appearance in the room of a single Afghan official, a citizen of a village likely to experience the violence, any opposition leader nor the head of state of any neighboring country in the Middle East.
During his speech on Monday, President Obama stated that the enemies are extremists that have hijacked a kind and gentle religion and are now its militant enemies.
If that is the case, then where are the Saudis, Egyptians, Kuwaiti’s, U.A.E., (the latter two could offer some financing if not much of a military contribution) and other peace-loving Sunnis, and Shiites, who are far more at risk than the western world? Why are they not participating in the struggle against militant Islam? The question is never even put on the table. Why are the economics of the financing of the Taliban and Al Qaeda not analyzed and reported on?
The poppy trade and the thugs that run it are part of a network of corruption that can easily be interrupted with military action against crops instead of people. It would seem likely that this strategy would do far more to destabilize and break up the militant groups than chasing them back and forth across the Pakistan border. Some of us would like to know if this option was ever considered as a strategy or tactic.
Finally, Pakistan has an army, it is already trained and, as we all know, Pakistan has more to lose with a Taliban controlled Afghanistan than any country, including the United States. If an escalation of war is the answer, why isn’t the Pakistan army the first line of offense in this surge, with U.S. soldiers securing their nuclear facilities?
Perhaps there are good answers to these questions, perhaps our government is acting in our best interests, but the arguments and reasoning put forth reflects the idea that fear, politics, and the military are running the day. The Military is not at fault, its job is to provide military solutions and to paint a worse-case scenario. It is the responsibility of a civilian controlled democracy to run the Military.
The opposite seems operative since 911. It is ironic that a president, who was elected by appealing to our best instincts, has bowed to fear and the illusion that we can somehow be protected against the threat of violence through increased force. There is virtually no difference in the rhetoric coming from this administration than that of his hapless and deceiving predecessor.
It is positively Orwellian that this president, after choosing to address this complex issue by caving in to his military advisors, would soon trot off to accept his Nobel Peace Prize.

Many traditional journalists were up in arms last week when the Dallas Morning News announced that senior editors in the sports and entertainment departments would report to executives from the business side of the newspaper. Purists accused the A.H. Belo paper of breaking down the traditional wall between the editorial and business/sales sides of the business.
Really? The newspaper Titanic is sinking fast and the journalism dinosaurs are arguing about the proper color of life preservers.
Dallas Morning News Executive Sports Editor Bob Yates said in a phone interview with Richard Prince of the Poynter Institute, “To me, this is nothing new for the newspaper. Editors of the paper report to the publisher. It’s the same pattern.”
And it’s been the same pattern in television and magazines for decades, but the arrogant journalism elitists who benefitted from newspaper monopolies that were sustained by massive barriers to entry looked down their noses on considering the interests of consumers and customers as crass. Journalists had no concept of or interest in the business of news and thought that people in management and, especially, in sales were the bad guys, which I know from first-hand experience because I taught at the oldest journalism school in the country for ten years.
As early as the 1970s television executives, including those in TV news at ABC and at local stations, realized they were not in the news business but in the advertising delivery business and that the goal was to attract eyeballs – get ratings – not necessarily to produce what newspeople thought was good journalism.
Time, Inc. launched People magazine in 1974 not because Time, Inc. thought it was great journalism, but because it realized that the People section of Time magazine was the most popular section in the magazine and celebrity and human interest stories were what consumers (readers) and customers (advertisers) wanted, and People soon became the most profitable magazine in the world.
The internet brought down the barriers to entry into the news business and eliminated the basis for many local newspaper monopolies. So what was the response of journalists at these papers? Often they decry massive layoffs. But the The Dallas Morning News is doing something radical; it isn’t crying, it’s on the right track and trying to deal with the problem.
Maybe the business people will suggest to the editorial people in the sports and entertainment sections, which are the only ones affected at this time, to think about what readers are interested in. Maybe they will encourage the reporters to start conversations with their readers, because that’s one of the things the internet does best, facilitate communication and conversations.
Salespeople know how to develop relationships with their customers, maybe the newspeople will learn to do the same thing with their readers like Nicholas Kristof of The New York Times is doing.

As I walked in Central Park today, Monday, I was reminded by a flag at half staff that it was December 7, Pearl Harbor Day.
When I got up this morning, I wasn’t aware of the date, and I didn’t see a reference to Peal Harbor Day when I did my morning online skimming of The New York Times, The Huffington Post, and the blogs I subscribe to via Google Reader. Does this mean that everyone the New York City Department of Parks and Recreation has forgotten about Pearl Harbor?
As I walked back home, I thought that I should blog about my memories of December 7, so at least those who read or skim my blog will remember Peal Harbor and some of the lessons from 68 years ago.
I was nine years old on Sunday, December 7, 1941. It was before lunch on a bright, chilly winter day in Battle Creek, MI. Bobby Baker and I met on our bikes near Fremont School. I remember riding my Schwinn Classic Deluxe and that Bobby told me that the Japanese had bombed Pearl Harbor. Neither Bobby nor I knew where that was or what the implications were, but I knew about the Japanese because my mother and father had scrap books of their trip to Japan in 1928 when my father worked for the W. H. Gary Company in Kansas City.
In our house we had Japanese glass flowers and a metal crane standing on a turtle’s back and pictures of Japanese women in kimonos. My dad also had a trunk in the basement full of maps wrapped in wax paper.
The next Monday, the 8th, my father sent a telegram to the War Department in Washington that read something like: “I have a trunk in my basement that has complete, detailed maps of the entire telephone communication system in the Japanese Islands.”
On Tuesday he got a telegram back that read, essentially: “You want your trunk get on a train to Washington, D.C. today.” And he did.
My mother and I joined him in June and we spent WWII living in Alexandria, VA. My father worked in the Japanese section of G2 (Military Intelligence) in the Pentagon.
Looking back 68 years and thinking about the lonely flag flying at half staff in Central Park, I came home and Googled “flags at half staff” and discovered there are only four days during the year that it is customary to fly flags at half staff: Peace Officers Memorial Day, May 15th; Memorial Day, the last Monday in May; Patriot Day, September 11th; and Pearl Harbor Remembrance Day, December 7th.
Two of them commemorate all who died in the line of duty and two commemorate single-day events: December 7, when 2,402 died, and September 11, when 2,953 died.
In 1941 the United States declared war on the Japanese government to demonstrate that there were consequences for its terrorist, murderous behavior. We then occupied the country, disarmed it, and spent billions to help it become a world-class economic power, in part because it wasn’t allowed to spend on a military presence or on defense. We did the same thing with Germany with the same result.
It occurred to me that the 30,000 troops that Obama is sending to Afghanistan should probably be taught history so they could indoctrinate the Afghans, the Taliban, and Al Qaeda on the lessons of Pearl Harbor and World War II: Attack the U.S., let us declare war and then win, occupy their country, demilitarize it, pay to rebuild it, and get rich.
U.S. troops should be armed with guns to protect themselves, hammers and saws to build schools, and a DVD player to show the 1959 Peter Sellers comedy “The Mouse That Roared” that demonstrates step-by-step how to make war on America and prosper.
Unfortunately, from what I can see, the Taliban or Al Qaeda doesn’t have a sense of humor or the sense to learn from history, so they’ll have to learn the lessons of Pearl Harbor the hard way.
I remember the easy way – by seeing the flag at half staff.

I’m old fashioned. I grew up in an era when Thanksgiving dinner was a time not only for food but also for lively family conversations and catching up; but not today in the age of the internet.
At a recent Thanksgiving gathering, I noticed the younger people were more engrossed in their computers, iPhones, and TV (a Roku device streaming Netflix) than in conversation.
I’ll make a rough guess, probably based more on perception than reality, that of the six hours of hanging out before we sat down for dinner, that the amount of time spent on a computer, mobile phone, or watching TV was twice the time spent in conversation.
Was this self-absorption, narcissism, social anxiety, or the age of the internet? I suspect the major culprit was the internet, especially with those under 35 in the assembled clan.
I suspect that the younger people have, as Ken Auletta says in his book of the same name, been Googled. If they are curious about things and people, they use Google to get the answer, which is not necessarily an evil thing in itself, or, presumably, Google wouldn’t do it.
The problem is that the instant availability and accessibility of the world’s information has reduced the compulsion or desire, it appears, for social interaction. The internet has isolated people in their own private worlds, thus eliminating the need for social exchanges in person because Facebook does it much more efficiently and, more importantly, emotionlessly.
Young people tend to text, Tweet, or Facebook with each other instead of talking face to face or even over the phone (mobile, of course), I’m guessing because there is less expenditure of emotion, and fewer honest feeling exchanged. Like with a computer or iPhone, there’s no emotion, no feeling involved, and young people are used to interacting without their emotions being engaged, it seems. They have never seen a computer or iPone cry or laugh or fall in love or get angry; these devices just give up all the information in the world, but no feelings.
Also, as I wrote in a previous blog, “We tend to believe that lots of information is good for a democratic society, and in theory it is. However, in practice there is now so much information (content) available that it is possible by means of selective searches and selective perception to create an echo chamber so that opposing sounds are never heard.”
Not only are opposing sounds never heard, but also information that is not in our wheelhouse of immediate and intense interest is not searched for or noticed, thus increasing our narrowing polarization and isolation.
When I mentioned my observations about the Thanksgiving gathering to my good friend, Paul Talbot, he said, “If I had opened a computer, turned on the TV set, or looked at my cell phone during a family gathering my mom would have thrown me out of the house.”
If we had been at Paul’s mother’s house yesterday, all of us (including me) would have been outside and hungry – and deservedly so.
This incident has been a good reminder to me to shut down my internet devices when I’m with other people and to interact – to be curious and care about who other people are and how they feel. After all, I’m not an emotionless computer connected to the internet, or am I?

The marriage between Oprah and national broadcast television was made in show business heaven, but after 25 years she’s going to abandon the aging broadcast TV dinosaur, which will help push it into extinction.
TV made Oprah the most famous, most influential, most beloved, most generous, richest (about $2.3 billion) self-made woman in the world. However, last week she announced that she will stop airing her syndicated broadcast television daytime talk show in September 2011, by which time she will move her programming to her own cable network, appropriately named OWN (the Oprah Winfrey Network) – no one as ever said she’s not clever.
Here’s what Advertising Age had to say about Oprah’s move:

Oprah Winfrey’s decision to end her long-running syndicated program is a bet on the future of TV — that niche cable channels, with their dual revenue streams from advertising and subscriptions, will be a more stable media base, and that technology will allow any content provider to reach its core audience in a more direct fashion without having to be seen at a certain time of day and on a certain channel.

Not only will she boost cable’s ratings, but she will undoubtedly hurt broadcast television’s ratings, especially Diane Sawyer’s, who will by then be the anchor for ABC’s “World News,” (which has benefitted for 23 years from Oprah lead-ins) as pointed out by Brian Stelter in his thorough article in the New York Times.
This article, by the way, is just one more that reaffirms that Stelter is currently the most intelligent and knowledgeable writer about the television industry.
In two years, when Oprah leaves broadcast TV for cable, will television stations or even cable systems still be viable delivery systems? This Christmas several TV set manufacturers will be selling HDTV sets that connect directly to the internet (WiFi).
In a couple of years, will content providers such as Oprah have figured out how to charge for programming on the internet? Will Google’s YouTube have expanded its deal with CBS and be able to charge consumers directly for CBS programming? Will HULU.com, which this October had a huge surge in traffic because of ABC-TV programming, be a highly profitable delivery method? Will ESPN have made a deal with YouTube to change consumers $24.95 a month for all ESPN programming, including Web site content, streaming mobile content, podcasts, and streaming audio?
If so, will the broadcast TV dinosaur still be alive when Oprah abandons it?

Guest blogger Bill Grimes writes:
For several years I have written short analysis and opinion pieces on the New York Times Company’s business, financial, and management problems. In a January 2007 lengthy report I suggested that the company sell its broadcast properties (it later did), that it sell the Boston Globe (it tried this year but found no buyers), that it sell its interest in the Boston Red Sox and a Canadian newsprint company (it didn’t), that strengthen its already excellent Web site (it did) and charge a substantial subscription fee (a much different pricing from its previously failed attempt to charge users a fee for mostly its high profile columnists (it didn’t), and to discontinue soon the printing, publishing and distribution of the print newspaper which represents 40s percent of the NY Times operating expenses. Sustaining this printing expense will be very difficult in any economic environment and by continuing to print the paper when the content is being given away free online is the main cause, I believe, of the deteriorating circulation of the newspaper. Furthermore, it makes charging a fee for the online product more difficult because of the ease of pass-along readership.
My other criticisms subsequent to that lengthy treatise have been the woeful performance of management. Management decision-making at the Times Company moves like pre-global warming icebergs. And when it finally decides to act upon a critical issue or opportunity, the ideal time to maximize the economic value of such decision has long passed. For example, the broadcast stations were sold two years after prices for radio and television stations had peaked. The Boston Globe was offered for sale only a year ago, long after everyone knew that online competition (Craig’s List, Google and dozens others) had forever crippled newspapers’ print advertising market. Selling the Globeis of vital importance to the company because it would reduce its crippling debt (see more below), free up financial resources to bolster NY Times’content and enable management to focus all its attention on it.
Two years ago the company, after the disastrous decision to build and buy (with other investors) a new headquarters building and being apparently surprised shortly thereafter that its profits were in freefall, realized that it may not be able to service its billion dollars of debt even though then it had about $100 million in cash on the balance sheet. So management went to the market seeking capital. It was unable to sell any equity – too risky to buy stock in a company that was rapidly approaching cash flow negative and with $70 to 80 million in annual interest payments owed to their banks for their current debt.
It finally found a lender, Carlos Slim, the wealthiest person in Mexican, who provided $250 million in debt. The price the company paid for this money was 14.2 percent annually, a staggering amount given today’s near all-time low interest rates. That loan with the additional accrued interest is due to be paid in 2012, and, without the sale of a lot of equity or the entire company, it will not be possible. However, the interest rate accurately reflected investors’ concerns that the company may fall into bankruptcy, otherwise less expensive debt or equity would have appeared. As a debt provider, not an equity owner, Slim has an early call on company assets in bankruptcy although the value of the printing presses seems dubious and I believe the company has sold some of its interest in the headquarters’ building. Last time I looked the value of the Boston Globe, for which the Company paid $2 billion, has been written down to $700 million with no apparent buyers.
The financing story has another twist. It has been widely reported after Slim’s loan that the Times Company had another interested lender at the same terms. That investor was Hollywood mogul, media-savvy billionaire David Geffen. However, he insisted on a board seat and the Times Company management recommended that their board to refuse such a request (Slim had agreed not to ask for representation). Having Geffen on the board of any company, given his track record as an investor, entrepreneur and understanding of media and its audiences, would seem too good to be true. But Times Company CEO Sulzberger apparently wanted no voice conflicting with his own.
Now, the Times’ newest serious problem is a threat that may be the most endemically serious of all facing the New York Times Company, a threat that will exacerbate its profit loss and perhaps result in the Sulzberger family finally losing control of the business. It is no other than the substantial improvement of the content of the Wall Street Journal under News Corp ownership. I didn’t observe closely enough the content changes that were being made to the Journals product two months ago when I became a subscriber of both home delivery of the print paper and the online Web site.
After studiously reading it daily for this period of time I am hugely impressed with WSJ. It competes favorably with the king of business and finance news, the Financial Times and increasingly so with the New York Times in other international and US news. Every week it seems that more content is being added to the WSJ in cultural and lighter information.
The WSJ looks contemporary and even hip, with splashy color and creative graphics. Both the quantity and quality of the content seems to me to have been significantly increased. Specifically, the WSJ has broadened into much more of a news content product covering local, national and, most striking, international news. It is no coincidence to me that the only major newspaper (print edition) to enjoy an increase in circulation this past quarter has been the WSJ.
I have moments ago finished reading the entire Friday, November 20, issue – every story. Here are the highlights of the diverse news and information content I found:
The front page has four articles, one on the House/Fed/Treasury dispute with a compelling color photo of an angry Tim Geithner responding to a question; the second on the grounding of the nation’s airlines yesterday; the third India’s labor wars and the fourth a lighter piece which has long been a Journal standard on “Buffalo Troubles in California”.
Also on the front page is Oprah’s photo and a short statement of her new TV deal, a listing of fourteen “Business & Finance” stories and fourteen “World-Wide” news stories. And an informative chart titled “Vital Signs’’ of leading economic indicators.
Page two begins six pages of “U.S. News” stories, followed by four pages of “International News” articles. Each is well-written and are mostly in-depth stories of broad interest to the thinking person –the NY Times reader, to be specific.
I did not see a single story written by a syndicated news service. All displayed WSJ reporters’ bylines.
The “Opinions” pages, including three editorials, had nine stories:
The six-page Marketplace Section looks terrific with four articles on its front pages. “Money and Investing” came next with color charts and graphs.
Then, for me, where the biggest change has occurred and what is aimed directly (as is the increase in US and International news stories) at the NY Times reader is the increase in interesting articles in the section devoted daily to the arts, home, dining, culture, and sports. Today, being Friday, this section called the “Weekend Journal” led with an article called “Rock God or Mere Mortal?” about Tom Petty featuring a large color photo of him with guitar. This section included in depth reviews of two films, two books, five sports articles, two on theater and more. The WSJ now seems to be competing favorably in every genre of content with the NY Times, and it is difficult, given the financial structure of both companies, to see how the Times can compete long term. Murdoch has greatly enhanced the content and the experience of reading the Wall Street Journal. It has become appointment reading for me and I would think others. Not to mention the fact that according to what I read last WSJ’s web site has 1.3 million subscribers paying $90 a year for the product.
But here’s the really bad news for the New York Times, the WSJ, at least today, is filled with advertising. Fourteen full-page ads, most in four-color. Scores of half and quarter page ads nearly all for upscale consumer products –those that the Times has relied upon over the years. I can remember when most advertising in the WSJ was Business-to-Business and advocacy ads. The WSJ also today had a hefty real estate classified section and many ads were large enough to exhibit small pictures of houses for sale. It seems to me that in this depressed advertising market that WSJ is taking meaningful market share from the Times, and that tells me that we will see continued reductions in ad revenue at the Times and greater operating losses. With the $250 million plus interest due to Slim in two years (April 2012) the outlook continues to dim.
How much longer can we, the public, and the Times shareholder have to tolerate the inept management of the company? I love the Times content and, more importantly, believe it is very much needed in our society, but I am not sure the government will have any bailout money left to keep it coming to us. One of my small irritants of management is its continuation of its slogan “All The News Fit to Print.” If you love the Times and want a good cry, think hard about those six words, which reminds me of the most ignorant slogan General Motors used in every Chevrolet ad until Rick Waggoner was fired by the US Government: “Chevrolet: An American Revolution.”
Life without the New York Times would not be pleasant and much more dangerous, but at least with the remarkable improvement in the Wall Street Journal, it may still be tolerable.

Ken Auletta has written another enlightening book that explains what’s going on in the media: Googled: The End of the World as We Know It. If you want to understand the new world, buy it and read it.
Auletta explained how the three major television networks lost viewers and squandered opportunities to get into cable by massive-ego-driven infighting in his 1992 classic Three Blind Mice. In Googled he documents how two Stanford Ph.D. students, Larry Page and Sergey Brin, changed the media landscape and, in fact, changed the world while executives in the old media world squandered opportunities to get on the internet and whined about the death of their magic world – media history repeats itself.
Auletta invested two-and-a-half years thoroughly researching and writing , and no one could have done it better. The Columbia Journalism Review, in ranking him as America’s premier media critic, concluded, “no other reporter has covered the new communications revolution as thoroughly as has Auletta,” and New York Magazine described him as the “media Boswell.”
Executives, managers, and creative people in the media are not going to like what they read in this book because Auletta writes that at Google and in the new internet world engineers are the kings and queens and are the new creators that drive the business, not the marketers,salespeople, writers and directors who drive the dinosaur media.
Engineers believe in data and they ask tough questions. They ask “why can’t we make information free and accessible to everyone?’ Or “why can’t we put the needs of consumers first and not worry about making money right away.” This kind of thinking will drive greedy media moguls nuts. They’ll probably be happier watching “American Idol” or WWE Wrestling.
But you’re smarter than that. Read Ken Auletta’s Googled and don’t miss the final chapter, titled “Media Maxims” that he did not include in the book because it thought the 25 maxims (what he learned from writing the book) are “not organic to the book’s narrative, and because I feared it [would] muddy the book’s purpose, casting it as a How-To book.”
The final chapter containing the 25 maxims are available in a .pdf format on his Web site. Don’t miss them; they will give you almost the equivalent to a masters degree in media management.

Last week when I blogged about CNN falling into fourth place in the cable news channel ratings, I became a victim of my blogging – I had to watch CNN and HLN to see why HLN might beat CNN in the 25-54 ratings.
Watching CNN was numbingly boring, but not painful to watch. HLN (formerly Headline News and CNN2), however, was painful to view for more than a half-hour news cycle. The daytime anchor, Richelle Carey was as easy to watch as any carefully coiffed beauty on Fox News or Fox Business Network, and the graphics were easier on the eye and more in harmony with a news image than CNN’s (although not quite as good overall as Fox News’s graphics).
The problem was not the anchor or the graphics, but was with the story selection – the stories were all about crashes, rapes, murders, funerals, and disasters. The HLN stories offered a cornucopia of brief items with accompanying irrelevant, endlessly repeated video that would appeal to those who had the self-image of being a victim and wanted to watch stories of people suffering.
I remember reading a research study some years ago about why people like to read about or watch stories about disasters and crime. In addition to the fact the disasters usually create the opportunity for riveting video, people like to read or hear about them to feel good. They seem to say to themselves, “I’m glad that didn’t happen to me. I could be worse off than I am.”
Also, I think people who see themselves as victims like to have other victims as company. I suppose misery loves company. I suspect there is a deep need to reinforce their sense that they are victims and to confirm their persecution complex.
So I guess HLN has found its niche – victims.
The New York Times’ story titled “CNN Finishes Last in TV News on Cable” indicated that HLN in had a monthly average of 221,000 people 25-54 watching versus CNN’s 201,000. The reason the 25-54 numbers were touted is because that is the demographic preferred by advertisers, therefore the only viewers who matter.
So, of the 304 million people in the United States, I’m guessing there are about 25 million who are 25-54, which would mean that less than one percent of them watch the continuous victimization offerings of HLN. This is a small but obviously profitable niche for the Turner Broadcasting cable network (in turn owned by Time Warner).
HLN is profitable because there are marketers who target their advertising and promotion to people who feel like victims: Tax Masters goes after people who are victims of the income tax system, Humana Health Care goes after people who are victims of the health insurance system, Tylenol goes after people who are victims of old age, Long Island Hospital goes after victims of poor health, and Time Warner Cable, in its promotion spots, show people returning their Verizon phones, thus, they are victims of Verizon.
Thus, as a viewer, I couldn’t get away from the victim pitch – in the stories, in the commercials, and in the promos. There were victims, victims everywhere on HLN.
There is now a niche for victims on HLN; for angry, uneducated white men on Fox News; for dummies on Fox Business Network; for angry liberals on MSNBC; for sports fans on ESPN; for women on Oxygen; and for alien-abduction fanatics and circus lovers on CNN.
In the long tail of cable networks, appealing to ever narrower niches seems to be the prevalent strategy. UPN anyone – the Ukulele Pick Network?

On Tuesday, October 27, New York Times reporter Bill Carter wrote an article titled “CNN Last in TV News on Cable” in which he gave 25-54 ratings and rankings in prime time for the four cable news networks. He did not indicate where he got the numbers.
Sarah Rabil wrote a similar article on Bloomberg.com posted at 3:18 p.m. EDT and titled “CNN Falls to Fourth Place in Prime-Time Cable News” in which she wrote: “CNN, owned by Time Warner Inc., placed fourth among cable news networks in prime-time audience ratings in October, according to Nielsen Co. data provided by MSNBC.”
OK, now we know where Bill Carter got his numbers – the MSNBC flacks had been spinning the story to media reporters and columnists – and Sarah, as a good reporter should, wrote where she got the numbers. Bill Carter didn’t, but you know as well as I do what the original source of his information was.
Carter and Rabil acted as virtual, or rather digital, stenographers for the MSNBC public relations flacks, just like the flacks wanted them to. Neither Carter nor Rabil gave much insight into why the ratings might have been the way they were.
When I returned to the Bloomberg.com site at about 7:15 p.m. to link to the CNN story , I noticed it had been updated at 7:58 p.m. and the name of another reporter, Brett Pulley, had been added. The story’s headline was “CNN Falls to Fourth in Prime-Time Cable News Ratings (Update1),” was longer than the original one, and mentioned that the ratings information was “according to Nielsen data cited in an e-mail by Alana Russo, a spokeswoman for MSNBC.”
At least the Bloomberg.com reporters were transparent about where they got their information, but the journalistic question is “would the story get played to make CNN look bad if it wasn’t sold by MSNBC flacks?” and “Do the stories give insight or are the reporters merely acting as stenographers for their source?’
Carter’s New York Times story was more insightful and gave some possible reasons for CNN’s decline: CNN was down from 2007 and 2008, which were dominated by political news, and because MSNBC and Fox News in prime are filled with opinion programming and CNN, except for the ridiculous Lou Dobbs, isn’t. Prime time was emphasized because that’s where ratings and, thus, ad dollars are highest.
But neither Carter nor Rabil and Pulley’s story made the connection between CNN’s rating declines and the drastic change in the news network’s channel position on Time Warner Cable in New York, where almost 10 percent of the country’s TV homes are.
CNN was moved from the favorable Channel 10 position on Time Warner Cable in New York to the unfavorable position of Channel 78 and Fox’s FX network was moved to Channel 10. Why do you suppose this happened? Could it possibly have anything to do with the fact that in February, 2007, Time Warner spun off Time Warner Cable into a separate public company?
When Time Warner owned both Time Warner Cable and the Turner Broadcasting System, which owns CNN and HLN (previously Headline News), they were in the same family and CNN got favorable treatment from Time Warner Cable.
But after the divorce in 2007, the newly independent Time Warner Cable wasn’t in a mood to be nice to its former family members. After February 2007, Time Warner Cable was in a position to maximize profits for itself, not for its former family members.
I suspect Time Warner Cable instituted a pay-for-play policy and began to charge cable networks for more favorable channel positions. I’ll bet Fox sweetened the pot and got FX moved to Channel 10 in New York. I’ll bet that MSNBC ponied up, too, and got a more favorable position (Channel 14 in New York), next to its sibling, CNBC on Channel 15. It doesn’t look like CNN or HLN (Channel 58 in New York) coughed up enough, if any, money and got buried on Channel 78, which could affect the ratings.
The Nielsen ratings sample is notorious small and, thus, is not terribly stable from rating period to rating period, In October, according to MSNBC’s numbers as fed to the Times and Bloomberg.com, CNN in prime time had 202,000 viewers 25-54 and MSBNC had 250,000. Those 48,000 viewers could be a rounding error caused by the change in channel position (although CNN lost in a couple of months to MSNBC before the channel switch) or to sampling error.
But perhaps the larger questions is, “What does it matter to cable subscribers if Time Warner Cable is making more money because of pay-for-play, if indeed it is using this strategy?”
Well, my wife and I pay Time Warner Cable $142 a month for cable and an internet connection, and I can’t remember the price of our service ever going down. Well, that’s not entirely true; we recently got a measly $1.00 taken off our bill for eliminating paper and paying electronically. But the point is that our cable bills are going up, the service is passable at best (the internet service is fully automated by means of voice recognition and you have to give up two fingers and a toe to get to talk to a real person), and Time Warner Cable is now making more money than ever.
Not what you’d call consumer friendly. No wonder the cable industry is vilified in public opinion polls and shows up lower than even journalists and politicians (and that’s lower than whale dung). Consumers are angry, and having the cable companies inconvenience them with senseless channel switches just to make more money is going to make them angrier.
Comcast, the nation’s largest cable company (Time Warner is number two), is in negotiations to buy 51 percent of NBC Universal from GE. Congress will give this proposed merger close scrutiny because both Congress and consumers are angry, and when they both find out about play-for-play, they’ll be angrier, I’ll bet.
And it doesn’t help when business and media reporters don’t scrutinize stories the are fed by PR flacks and act as stenographers for cable company spin.