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Monday, May 04, 2009

The New York Times' Financial Woes May Cause The Boston Globe Closing

The New York Times has been in financial trouble for a while now, blaming the loss of advertising sales primarily for their dwindling profits but seeing the facts in black and white show exactly how bad that situation has grown.

But the Times Co. itself is under strong financial pressure. It recently mortgaged its new Manhattan headquarters, borrowed $250 million from a Mexican billionaire at 14 percent interest, laid off 100 newsroom staffers and cut salaries by 5 percent.

Whether they intend to shutter The Boston Globe, which Times co. bought in 1993, or whether it is a tactic being used because negotiations failed to produce $20 million in concessions from the unions, Times co. has filed a Worker Adjustment and Retraining Notification (WARN, which according to the law must be filed 60 days prior to shutting it down.

The move could amount to a negotiating ploy to extract further concessions from the Globe's unions, since the notice does not require the Times Co. to close the paper after 60 days. The deadline, however, would put the unions under fierce pressure to produce additional savings, and the Boston Newspaper Guild promptly called the step a "bullying" tactic by the company.

Former Globe columnist Eileen McNamara had some harsh words on the topic of Times Co. saying "From the moment the Times Co. purchased The Globe in 1993, it has treated New England's largest newspaper like a cheap whore. It pimped her out for profit during the booming 1990s and then pillaged her when times got tough. It closed her foreign bureaus and cheapened her coverage of everything from the fine arts to the hard sciences."

McNamara, who now teaches journalism at Brandeis University, ridiculed Sulzberger as "the boy genius whose crack management skills have helped drive the parent company of two of journalism's most respected newspapers to the brink of bankruptcy."

She has a point, under the Times Co. management, The Boston Globe is expected to take a $85 million dollar loss this year alone.

Unfortunately this is what happens when a media outlet produces more opinion and pretends it is news.