Blog Post

What The New York Times Should Do With The Globe

imageAfter some brinksmanship, the New York Times finally reached agreement with the unions at The Boston Globe last week. But the Times will still have to take some dramatic steps to get the Globe’s costs under control. Here’s a thought: What if the Globe were to file for Chapter 11? It is a separately incorporated subsidiary. In theory, this would allow management to more dramatically renegotiate its union contracts and restructure the asset. It could allow NYT to reduce losses at a faster pace, which would both provide the parent company with some breathing room and perhaps make the paper more attractive to potential buyers.

While I’m not a lawyer, I talked to one who couldn’t see why this would be an issue. If the NYT wants to alleviate its current cash pressures, this has a nice feel to it. The NYT got some concessions from its labor force, unionized and not, but a bankruptcy could let the NYT reduce headcount a bit faster. We have no reason to believe this would interfere with the sweetheart terms of Carlos Slim’s loan to the Times, unless it leads to a sale of the Globe, in which case proceeds would first be applied to reducing/paying back the loan.

Photo Credit: Flickr

One Response to “What The New York Times Should Do With The Globe”

  1. The last 2 articles are why I LOVE Paid Content. First, Paid Content has an article reporting delusional thinking from Media Giant (a nonmemorable name so this is the best I can do) so readers have the "news" about the news organization. Then this one with a real answer. C11 is the answer. Rightsize in on hard move, not with a 1000 cuts. They could consolidate services with local delivery people for the town papers (weeklys) and others. Work with the PO possibly. Get at least some of the staff out to 128 to 495 where the growth and money is. They need to imagine their perfect size–and do it all at once. Eliminate union deals; start over. Encourage one overall union then, such as the UAW or the Teamsters, or none, depending on worker choice. Too many of them are sucking up time and a terrible distraction. Great thinking by Lauren Fine–and terrific that Paid Content posted it.