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Who Would Want To Buy A Newspaper? Eli Broad Resurfaces

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 Responses to “Who Would Want To Buy A Newspaper? Eli Broad Resurfaces”

  1. 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 (

    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
    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!!!!


    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.


  2. 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.'


    Sam Stew

  3. 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.


    Sam Stew