These are curiously masochistic days for the New York Times Company. Stumbling now into what will likely be a distracting proxy fight with an investor group that happens also to be their largest shareholder, there does not seem to be a correct decision coming from either their commercial or editorial divisions.
Last week, the New York Times Company announced an agreement with Tribune, Gannet, and Hearst to form Quadrant One – an online sales conglomerate designed to sell advertising inventory across the many local newspaper sites owned by the four media companies. The new entity has been described to the advertising community as an attempt to make it easier for advertisers to purchase online media across a broad swath of local markets, but in truth it is an arrangement that effectively wipes out the brand equity of the participating local newspaper sites. These local newspapers were clearly properties that the New York Times Company felt necessary to acquire way back when. To now put the local web components – and the individual futures of the local newspapers’ declining print businesses – into an anonymous commercial bucket with three other media companies that frankly the New York Times Company does not need is nothing less than admitting that the local properties have little value.
Dana Hayes, the interim CEO of Quadrant One – and full-time SVP of advertising sales for Tribune Interactive – spoke with Advertising Age. “Specific inventory will go into Quadrant One. Premium positions and units above the fold will go in,” he said. The most desirable online advertising inventory across New York Times Company’s local newspaper sites will be represented by competitors of the New York media empire – under the umbrella of providing an ease-of-use consultative service to national advertisers. The advertisers are, in turn, able to buy this inventory at rates that will likely reflect the dismissive nature of the Quadrant One establishment – in other words, rates that reflect a commodity.
But while questionable commercial decisions can be quietly corrected at a later date, grand editorial mistakes at a newspaper that was once considered a champion of integrity have longer-term consequences. The decision to run with the McCain story during this most important presidential election year may prove to be the New York Times’ biggest blunder.
Earlier today, MarketWatch labeled the New York Times an “embarrassment” and went on to say that the paper “lowered itself to the rank of shrill tabloid.” MarketWatch is a notable Wall Street voice – something the New York Times Company does not need under the backdrop of proxy fights and stock price declines. The stock was down more than 3% today alone.
While one could argue that MarketWatch sits at an opposite speculative pole to that of New York Times, the reliance on anonymous sources has brought universal media scrutiny to the editorial team at the paper. Bill Keller, the paper’s editor, is now publicly stating that he is surprised at the magnitude of the negative reaction.
In this era of consumer-generated editorial, rising blogger and independent writer influences, professional journalism is under siege – and the McCain piece did not help the profession. The New York Times Company exists on the foundation of its content; it has no other diversity in the company’s portfolio of offerings. The company’s future viability rests on the respect of its readership, and the McCain fiasco is putting a bad taste in the collective mouths of that declining readership.
And while it is true that the paper does brandish its leftist slant with a somewhat unsettling frequency, it is also true that the current presidential contest is unearthing a growing population of people who do not readily embody a particular party’s philosophy. It is not a large leap to assume that this population does not have the stomach for the creep of editorial perspective in what is otherwise deemed to be a reliable news source. For these reasons, independent and more neutral sources are continuing to take mindshare – and the share of advertising dollars – from the New York Times Company.
In these unstable times for the newspaper business, the implosion at such an esteemed journalism brand is remarkable. With the proxy fight on the horizon, one does not know for whom to cheer. It seems that the folks at the company may need to be saved from themselves.