A Few Words about the “Failing” New York Times.

Very few chief executives leave office on a note as high as Mark Thompson, who announced last month that he would retire from the New York Times Co. at the end of the month.  Thomson took the job in 2012, amidst criticism for having failed to act decisively as director general of the BBC in the case of a long-time broadcast personality who had turned out to have been a long-time pedophile. But the NYT Co.’s board stuck by him, and in the nine years since Thompson has done for The New York Times what he had done previously for the BBC: transformed a stagnating legacy business into a thriving enterprise whose digital revenues are surging.

How?  By signing up some 3 million digital subscribers at $15 a month – nine years without a price increase. A hike is finally in the works, Thompson told Ken Doctor of NiemanLab last year.  Stand-alone Crossword and Cooking subscriptions add nearly a million more. The print edition of the Sunday Times, nearly 900,000, brings the total to 4.9 million. Meanwhile The Times is hoping so add another 5 million digital subscribers by 2025 at the higher rates.

Revenues were $2.1 billion the year before Thompson took over; they were 14 percent less last year, or $1.81 billion. Yet NYT Co.’s share price was $ 46.14 on Friday, up from $7.75 when he arrived. In those years the Times has added some 200 journalists to its payroll, bringing the newsroom total to around 1700.

So much, then, for President Trump’s frequent references to “the failing New York Times.” Trump’s election and subsequent behavior have surely been the single biggest contributor to the growth in Times readership.

If there is a long-range risk to the company, it is that Thompson has thrown the tiller over too sharply.   He told Jim Waterson, media editor of The Guardian, that success stemmed from shaking things up, hiring younger employees and adopting the attitudes of Silicon Valley: “Letting very young, junior people play with big dangerous things. It’s a long way from the way things are done in many newsrooms.”

The relationship between newspaper companies and their print editions was that of “the Titanic [to] an iceberg,” he continued. The New York Times would be one of the last print newspapers to go digital-only, Thompson told Waterson, but “it’s going to happen.”

The danger to the Times is that it won’t happen to the others major newspapers.  Bancroft family heirs sold The Wall Street Journal to Rupert Murdoch in 2007.  Donald Graham sold The Washington Post to the family of Amazon founder Jeff Bezos in 2013.   Pearson, the British conglomerate that had owned it since 1957, sold the Financial Times (and half of The Economist) to Nikkei, one of Japan’s oldest and largest media companies, in 2015.  All three new owners have far deeper pockets than do the members of the Sulzberger family trust that controls the Times.  All three companies sell subscriptions to their print editions for around half as much as the $1,200 annual rate of the Times.

Meredith Kopit Levien, the former Forbes advertising executive who has been Thompson’s second-in-command for several years, will replace him in September.  She urges Times journalists to stop referring to their employer as “the paper.”  There is no similar term that rolls off the tongue to describe the thriving new digital agencies that are now part of the “mainstream media,” she acknowledges. They include giants Bloomberg and Reuters, startups like Quartz, Vox, and Axios, and traditional broadcasters such as the BBC or newspapers such as The Guardian.

Still, Levien told NiemanLab, “Something like three million people listen to The Daily [the Times‘s podcast] every day and something close to 5 million people open The Morning [an email version] every morning. [It’s] a newspaper in a different form.”   What difference, if any, might the finite space budget of a printed newspaper page – the 240 square inches of a front page in particular – make to the various constituents of the world of mainstream news?   That answer to that question will take many years to become clear.

Then again, maybe that $46 share price – more than fifty time last year’s earnings- per-share – means that the Times itself is half in play, expecting and fearing an offer from some computer-age mogul that could prove difficult for its controlling cousins to refuse.  If so, Thompson won’t have been the first CEO to structure a company for sale via indirection. Either way, the Times today is anything but “failing.”

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Most economists who knew Harvard economist Emmanuel Farhi learned the cause of his death very quickly.  But so painful was the death of the 41-year old theorist that it has yet to be recognized publicly as suicide anywhere but here. An extraordinarily sad business in any case, not susceptible to any easy explanation. That is what makes it so hard.

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