Who Would Want To Buy A Newspaper? Eli Broad Resurfaces

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imageBack in 2007, when Sam Zell was swooping in to buy the Tribune Company, Eli Broad was mentioned as a possible last-minute bidder for its flagship paper, the Los Angeles Times. Now, as Tribune files for bankruptcy, the billionaire founder of KB Homes and SunAmerica is talking again about a possible LAT purchase.

At a lecture on business and philanthropy in New York City last night, Broad discussed how a deal might be structured if the paper is put up for sale as part of the bankruptcy proceedings. “I would like to see our foundation and others join together to own the LA Times,” he said, adding “we can’t afford to lose good newspaper journalism, investigative reporting.” He said the new owners would have to be comfortable with the idea that it is highly unlikely the paper would ever generate the profits it once did. He also said that the LAT couldn’t survive as a national newspaper, but that it could possibly partner with other papers like the Washington Post (NYSE: WPO) to piece together national coverage.

More after the jump

The LA Times was part of the Times Mirror newspaper empire before Tribune bought the chain in 2000 for about $8 billion. Tribune was taken private by real-estate tycoon Sam Zell in 2007 as part of a $8.2 billion, debt-laden deal. The company filed for bankruptcy in December as it strained to pay off that debt.

“No one has figured out a good business model as of yet,” Broad said of the newspaper industry. “Newspapers ought to be owned by foundations, not look for great financial returns.”

6 Comments

Sam Stew

RE: My previous comments on a
newspaper and magazine industry
'FREE PRESS' standard, USB smart
card (key ring format), as a 'add-on' or
band-aid tech, until something more
powerful comes out regarding
public key encryption and crypto-
hardware based 'cloud computing'

Dear Sirs:

My understanding of the older hardcopy news-
paper industry finances was a 'rule of thumb'
for daily A.M. newspapers of:

$0.50 [US $/week-day copy]
(~$.50 [US $/blank newsprint price of paper]
________________________________
$0.00 [US $ profit/week-day copy], but, 1
ad circulation credit.

~$0.50 [US $/week-day advertising revenues]
(~$0.50 [US $/week-day editorial staff costs]
________________________________
$0.00 [US $ profit/week-day copy]

~$0.35 [US $/week-day classified revenues]
($0.00 [US $/week-day circulation costs]
__________________________________
$0.35 [US $ profits/week-day paper]
x ~3.5 million [big-city circulation/day]
__________________________________
~$1.0 million [US $ gross profits/day]

This newspaper costs and profit formula,
broke down in the late 1990's, from:

CASE 1: Craig's List, a non-profit, giving out FREE
e-classified ads (www.craigslist.com).

CASE 2: Google (R ) taking FREE LUNCH digital
media, feeding it into its FOR PROFIT Web
browser engine, and making huge profits in
fully paid and FOR PROFIT, 'directed search'
or highly focused search, based upon a custom
per customer collected 'marketing preferences
database,' which collects every type of personal
search data on its customers possible. This
highly sensitive database, is allegedly protected
by weak US corporate privacy laws, but, is
obviously a privacy issue, and is undoubtedly
subject to government and private party leaks.

Google (R ) has taken FREE LUNCH hardcopy
books to feed its FREE LUNCH search engine,
and even FREE LUNCH e-newspapers, also
feeding its FREE LUNCH search engine, not
paying 1 penny for content creation!!!!! This
rings of Napster's (R ) early attempts to violate
US Federal copyright laws.

To compete with both Google (R ) and Craig's List
(R ), the US newspapers and magazines, offering
paid content, PAID LUNCH digital media, will have
to go with 'cipher text' format or encryption methods,
otherwise a monthly at home newspaper rate of
$45.00 [US $/month/home delivered newsapper],
will be customer dropped. The daily at home
delivered NY Times was about y. 2008
$55.00 [US $/month/home delivery]!!!!

Replacing high quality and integrity, PAID LUNCH
PAID CONTENT newspapers for FIRST AMENDMENT
support and publishers and reporters brave enough
to pursue a good faith effort, at God's whole TRUTH
(e.g. Watergate scandal, e.g. anthrax mailings), with
FREE LUNCH entertainment, is not a wise trade!!!!

Sincerely,

Sam Stew

P.S. – If anybody wants to support the FREE PRESS, and
wishes more details on this plan, pls. e-mail me to
have any questions answered.

.

Sam Stew

P.S ( To my first comment):

The company of Texterity (R ) Corp. was
mis-spelled as Textuality (R ) Corp..

Also, there is a huge download time
difference per communications MODEM
type of relative per home-business MODEM
type (v.22 BIS MODEM, ADSL MODEM,
broadband cable MODEM, direct
fiber transceiver connection):

CASE 1: newspaper style (95% text and 5%
low-rest color graphics/page), best
met by Olive (R ) Corp. type of
HTML or Web-style pages.

CASE 2: news magazine style (95% hi-rest,
color graphics, and 5% fonts based
text), best met by broadband MODEM
supported, Texterity (R ) Corp. type of
low-res, post-script file, 'streaming bit
map,' giving a 'thumb through' the color
magazine, e-magazine, on-line reading
approach. But, Web style 'thumbing
around' (HTML transport on underlined
URL's) is lost.

My understanding is that Texterity (R ) Corp.
takes actual newspaper and magazine
postscript files for hardcopy, and at their own
server, re-processes them in low-res for
screen graphics, screen fonts.

CASE 3: very hi-res, color graphics (e.g.; National
Geographic standard color print
graphics), best met by over-night down-load,
Adobe Book|Adobe Acrobat (R ) format
e-book format, with fancy 'simulated font'
support. Here the downloaded fonts, may be
custom fonts, vs. NY Times font, or LA Times
Gothic font.

Also 'thumbing around' via Web Style, hyper-text
transport mouse clicking upon underlined
URL addresses, is also lost.

Exactly which format will 'sell' for what digital
medium, is yet to be established in the market.

A print industry-journalism industry standard
USB smart card (key ring format), will be an easy
add-on hardware solution, to give [family key/issue],
'paid content,' under paid e-subscription
controls, plus will automatically block-out
Google (R ) and Yahoo (R ) free spider-robotic
page searches, by submitting family key
encrypted (cipher-text). Any through-put
problems, can be handled by 'spot encryption.'

Sincerely,

Sam Stew

Sam Stew

Dear Sirs:

I am wondering why somebody in the printed
newspaper business, does not look at
a 'band-aid fix' interim solution for
e-newspaper, for profit, paid content, of
combining together:

USB smart cards for PC's (keyring style),
holding of 'shared family keys/issue,'
and standardized for the entire
e-newspaper paid content industry,

Web servers of Olive (R ) Corp.'s
e-newspaper in HTML format,

Web servers of Textuality (R ) Corp's
e-newspaper in 'streaming bit map,'

Adobe Corp's e-book format (must be
downloaded over-night),

existing PC hardware under Windows XP, Vista.

Such a combination will be 'add-on' tech for
a very fast, real-time downloaded, standard
encrypted, e-newspaper of 'paid content,'
which could also be archived and re-read,
and could be shared among users, but,
would be denied to Google (R ) and
Yahoo (R ) search services due to
'cipher text' encryption.

I am a FREE PRESS and 1st AMENDMENT
advocate, and wish to see healthy newspapers
around the world, with for profit 'paid content'
high enough to give financial security to the
publishers and reporters reporting of a
good faith effort at God's whole TRUTH.

Sincerely,

Sam Stew
[email protected]

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