The FT has a confused story this morning on the newspaper industry. Its headline says “Newspapers turn into rich mens’ toys,” but the story’s primary example is The New York Times and its financing deal with Mexican billionaire Carlos Slim.
Now, far be it for me to be naive enough to say that it doesn’t matter who owns you, but I’ll give the Times more credit than that—and as the FT concedes, papers have “long been the playthings of wealthy men.” Slim will have no voting rights, just the right to make near-usurious interest off of his investment (the potential ex-KGB agent buying London papers is more worrisome).
And this paragraph makes no sense:
Newspapers have long been the playthings of wealthy men but a seemingly endless decline in advertising revenues is raising the question of whether private ownership or the shelter of sitting within diversified empires is now the industry’s only valid business model.
Which is it?
That said, the story does have an interesting point today about the newspaper industry:
The $5.6bn Rupert Murdoch’s News Corp paid in 2007 for Dow Jones, owner of the Wall Street Journal and several local papers, would now be sufficient to buy Gannett, the New York Times, McClatchy, Media General, Belo and Lee Enterprises, even at twice their current share prices.
That’s incredible.
It seems you haven't read the latest news from CNN on this. The 14% interests are tax deductible. This is what Slim does in Mexico and now he taught the Times how to do it; They both will benefit from it. Check the CNN on how the NYT will deduct the interests. Very smarth from both, and both win.
#1 Posted by Jason Bailey, CJR on Thu 22 Jan 2009 at 05:19 PM