Patterico's Pontifications


More Bad News for The New York Times

Filed under: General — DRJ @ 12:22 pm

[Guest post by DRJ]

Nat Worden of TheStreet thinks the last great newspaper war in New York City is imminent and The New York Times may be moving closer to surrender:

“With News Corp. (NWS) poised to swallow Dow Jones (DJ) , New York Times (NYT) looks vulnerable on the eve of what could be the last great newspaper war in New York City.

Shares of the Gray Lady hit 10-year lows Wednesday after a Wall Street analyst downgraded the stock to a sell, citing the potential for a recession to weigh on advertising from luxury goods retailers, which make up 28% of the company’s national advertising revenue.

In another sign of weakness, a memo to staff members at the company’s flagship newspaper said the publication is cutting newsroom jobs amid a hiring freeze. This at a time when its chief rival, The Wall Street Journal, is hiring as its publisher prepares to duck under the News Corp. umbrella.

News Corp. CEO Rupert Murdoch, who struck a deal to acquire The Journal’s publisher this year, has said he plans to beef up its political coverage, signaling that the right-wing media mogul, who makes no secret of his disdain for the Times and its perceived liberal bias, is hell-bent on burying the Gray Lady on her own turf.”

Analysts see more bad news ahead for The Times:

“In addition to weakness in the luxury goods sector, Bank of America analyst Joe Arns said in a research note that The Times is also vulnerable to the pain in financial services wrought by the subprime lending debacle, because roughly half the company’s revenue comes from finance towns New York City and Boston. Banks like Citigroup (C) and Merrill Lynch (MER) have taken gigantic writedowns, and many observers say that more trouble for the industry is in store.

Arns said a recession could result in a 20% gap or more between the company’s forecast for 2008 earnings before taxes, depreciation and amortization and Wall Street’s expectations.”

In an effort to cut costs, management previously imposed a freeze on hiring and now laid off about a dozen support staff, but no journalists:

“For now, the Times is cutting about a dozen support positions in its newsrooms, according to media reports.

“This staff reduction does not include any journalists, nor any widespread buyouts, as has happened in the past,” Executive Editor Bill Keller wrote in the memo, according to Reuters. “We put into place a hiring freeze several weeks ago, and except for those jobs that are critically important to our future ambitions, we will be trying to fill their positions internally.”

It’s never good news to hear that people have lost their jobs, especially around the holidays, and I hope they find employment quickly. They might try the Wall Street Journal.


7 Responses to “More Bad News for The New York Times”

  1. Frankly i hope the New York Slimes loses even more readers

    krazy kagu (5b69ac)

  2. Nat Worden of TheStreet thinks…the New York Times may be moving closer to surrender

    And “surrender” was Worden’s characterization? Let’s try to be a little realistic.

    The same Worden filed about the NY newspaper wars waaay back in June and mentioned that “shares of New York Times have jumped 13% since Murdoch’s offer was made public May 1.”

    The situation is worse and worsening but a pending “surrender” is wishful thinking and your creative magnification.

    steve (603d28)

  3. I like how Murdoch is unreservedly defined as “right wing” while the NYT only has a “perceived” liberal bias. No double standard there!

    Sean P (e57269)

  4. Steve #2,

    I agree we should be realistic so let’s look at what I actually wrote.

    I said the NY Times “may be moving closer to surrender” which is not the same thing as claiming The Times has surrendered, is it?

    DRJ (8b9d41)

  5. There is no inkling of a “surrender” scenario in Worden’s piece.

    “Vulernable to pain,” yes.

    The recipient of a full-frontal attack by Murdoch, yes.

    An analyst’s “sell” recommendation on NYTimes – or Citigroup – stock isn’t a portent for directors “moving closer to surrender.”

    steve (e57e28)

  6. Steve,
    I don’t think you can differentiate between a blip and a trend.And I don’t think there will be any surrender.I think The Times will expire with a whimper,not a bang.
    (Actually,I don’t think it will expire.But I think it will be”radically” changed and downsized.
    There are too many of us who don’t read the Times anymore because of their bias .Fess up,now:do you think one could read the NYT’s and be well informes about what is happening in the world-or even NYC?
    I don’t.
    And Steve;are you rushing to buy the stock?

    corwin (8c1b37)

  7. citing the potential for a recession to weigh on advertising from luxury goods retailers,

    Hoist by their own economy fear-mongering. Ha, ha.

    andycanuck (7e9ca1)

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