The Bloomberg-Times Competition and Courtship
by Ira Stoll
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New York Times chairman Arthur Sulzberger Jr.'s firing of the paper's executive editor, Jill Abramson, is being seen through several different interpretive lenses. There are those, like Susan Glasser and Amanda Bennett, who see it in the context of the treatment of women editors in the workplace. There are others who see it in the context of the struggles of print newspapers to reinvent themselves for a digital age. But another way to look at it — and an intriguing one — is as the latest development in what is both a competition and a courtship between the New York Times Company and Bloomberg, L.P., and their proprietors, the Ochs-Sulzberger family and Michael R. Bloomberg.
It's a competition, because the New York Times and Bloomberg News compete for news and for staff. As Sarah Ellison reports in Vanity Fair, Ms. Abramson's replacement as executive editor of the Times, Dean Baquet, "had earlier been offered a job at Bloomberg News," and as Mr. Sulzberger put it to Vanity Fair, "we risked losing Dean."
Had Mr. Baquet decamped to Bloomberg, he would have followed a platoon of talented Times editors, including David Shipley, Jonathan Landman, Timothy O'Brien, Mary Duenwald, Paula Dwyer, James Gibney, Tobin Harshaw, Katy Roberts, Clark Hoyt, and Winnie O'Kelley. They are lured in part by the higher compensation offered by Bloomberg — "outsized salaries," as the Times described them in one news article.
The two news organizations cover each others' troubles with glee.
The Times was all over the story of Bloomberg reporters using Bloomberg terminal data to assist their reporting on Bloomberg financial services data customers such as Goldman Sachs and JP Morgan Chase. And the Times fronted a news article about Bloomberg's decision to delay publication of articles that might anger the Chinese government. A Bloomberg reporter involved in that episode, Michael Forsythe, was later hired by the Times.
Bloomberg, meanwhile, has been aggressively covering Ms. Abramson's exit. "Sulzberger, Abramson and Keller didn't immediately respond to calls to their mobile phones," said one article by Bloomberg reporter Edmund Lee, who apparently both has Mr. Sulzberger's cellphone number and isn't afraid to use it. Al Hunt, a Bloomberg columnist and television personality who is a pal of Abramson's from their days as colleagues at the Wall Street Journal, went on Bloomberg TV to declare that Mr. Sulzberger firing of two executive editors and a CEO in 11 years "raises serious questions about his management style, doesn't it?"
All the tension, though, masks and betrays a certain romantic attraction. For as is widely recognized at both Bloomberg and the Times, Bloomberg is the likeliest purchaser of the Times if the Ochs Sulzberger family — which at this point includes not only Ochses and Sulzbergers but also Dolnicks, Goldens, Perpiches, Greenspons, Greens, Dryfooses, Kirschts and Cohens — decide to sell.
And that decision is the elephant in the room. The Times itself, in a news article published in January of this year, described a meeting between Michael Bloomberg and the staff of Bloomberg Businessweek magazine in which, "when asked if he would be interested in buying The New York Times, he joked that he was not, partly because he would not be able to influence the coverage." The New York Post last week quoted a Bloomberg source as saying, "Mike doesn't think about buying the Times, mostly because it's not for sale."
But what if it were for sale? Other newspaper families — the Chandlers that owned the Los Angeles Times, the Bancrofts that owned the Wall Street Journal, even the Grahams that owned the Washington Post — have sold. Family control of the Times rests with an entity called the 1997 Trust, so named for the year of its creation, a date one year before Google was created and a moment when it would have required a prophet to foresee the havoc that the Internet would wreak on the newspaper business. The Trust is set up to last 21 years after the death of the last surviving child of Iphigene Ochs Sulzberger (Two of the four, Marian Heiskell and Ruth Holmberg, remain alive). At least until then, the trustees are directed not to sell the paper, unless they determine that doing so would better achieve the trust's primary objective, which is, according to the Times proxy statement, "to maintain the editorial independence and the integrity of the New York Times and to continue it as an independent newspaper, entirely fearless, free of ulterior influence and unselfishly devoted to the public welfare."
Bloomberg certainly has the money to buy it. Forbes puts his wealth at $32.6 billion, an upward revision that followed an astute New York Sun article in 2006. That dwarfs the New York Times Company's market capitalization of about $2 billion. Mr. Bloomberg's assets outside the financial information and terminal business are managed by Willett Advisors, a firm run by Steven Rattner, a former New York Times reporter who is a pal of Arthur Sulzberger Jr. and who is a contributor to the Times op-ed page. Mr. Bloomberg grew up in Medford, Mass., home of Tufts, where Arthur Sulzberger Jr. went to college. The Times endorsed Mr. Bloomberg for mayor in 2005 and again in 2009, though its news coverage sometimes riled the mayor. Mr. Bloomberg even is a student of Spanish, which may help with managing Carlos Slim Helu, another big New York Times shareholder.
It's possible to make the case that the gusher of revenues from Bloomberg's financial information, analytics, and trading platform terminal business are a better guarantor of editorial independence than are the Times' diminishing print revenues and their uncertain digital replacement, though if the fear that China would retaliate for news coverage by restricting terminal sales did indeed affect the Bloomberg news coverage, that would tend to undercut that case. David Warsh points out that Bloomberg employs roughly twice as many journalists as the Times does.
If editorial independence were the sole criterion, the owning family might hold on. Sometime down the road, though, there will be estate tax to pay. So since 2010, the Sulzbergers have been gradually selling. The family's economic ownership of the company has declined to 13 percent from 19 percent over the past four years. A company spokesman told the Wall Street Journal the sale of the shares, which would be worth about $146 million, was because of "estate planning and long term estate taxes."
Wouldn't it be something if the family that owned the Times were ultimately dislodged from its perch because of taxes on the rich that remained in place in part because of enthusiastic Times editorials like this one denouncing "the false claims and warped premises of ardent estate-tax cutters"? If Republicans ever realize that the estate tax could dislodge the Sulzberger family from the Times, they may be tempted to rethink their support for its repeal. Or perhaps the Times editorial writers will rethink that language about false claims and warped premises — that is, if they aren't too busy polishing their resumes and sending them over to Bloomberg View.
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