Tribune Update: Zells Keeps Talking; Stamford Sale Blocked; Shareholder Sues

The man who will take control of the Tribune Company if a complicated process goes as planned (note to copy desks: he’s not the new owner) has been talking again. During an appearance at Stanford late last week, Chicago developer Sam Zell said letting Google steal content was bad for media companies — setting off a wave of suggestions that he must not know much if he thinks Google is stealing. The actual quote, according to the WP: “If all of the newspapers in America did not allow Google to steal their content, how profitable would Google be? Not very.” He said the current arrangement between search engines and newspapers will have to give way to new formulas that “reflect the cost benefit.” Put aside the provocative “stealing” aspect aside, what Zell is saying is no different than many others have said: allowing content to be used for little or no compensation is a core issues newspapers and other media outlets have to address. The company he wants to head has tried a number of fixes, including premium content, but has yet to find a real solution.

Zell sat down the next day with an LA Times reporter for an hour and went into a little more detail about online than he did with the Chicago Tribune. He is impressed by one part of the Tribune’s digital strategy: it’s 42.5 percent stake in CareerBuilder.com: “Anything that’s growing at 25 percent certainly gets my attention. I just wish osmosis would permeate all the other entities the company had so that we could in effect have a 25 percent growth rate across the board.”
— He had dinner after the interview with David Geffen, who continues to press for some kind of deal involving the LAT. He also received letters of interest “from four groups in Baltimore, three in Hartford, four guys in Orlando. But we started with the idea and the focus that we would keep all these things together.”
— One interesting note: latimes.com is running advice from readers as a sidebar to the story.

Stamford sale blocked: An arbitrator blocked Tribune’s sale of the Stamfiord Advocate to Gannett Monday, ruling that the sales agreement violates the contract of newsroom employees represented by the UAW. According to the SA, the arbitrator said a sale must include the contract; Gannett has told workers when the sale was announbced that the contract was not part of it and wouldn’t be honored.

Shareholder lawsuit: A lawsuit filed late last week in Chicago by shareholder Reed Simpson says the deal to take the company private should be blocked because good-faith wasn’t shown to bidders Ron Burkle and Eli Broad, according to the Chicago Tribune. He also alleges the board “stood on both sides of the issue and engaged in self-dealing and obtained for themselves personal benefits, including personal financial benefits, not shared equally” by other stockholders. Top execs will share a bonus pool for putting the deal together.

loading

Comments have been disabled for this post