The New York Times Gets a British Accent
Since 1896, The New York Times has been America's flagship general-interest newspaper, inventing the concept of "fair and balanced" reporting long before Fox News claimed it as their infamous catchphrase. Love it or hate it, it's hard to imagine a media landscape without The New York Times. But that's exactly what could happen if the company doesn't start to turn a profit.
Yes, the print version of the Times is still on sale in practically every bookstore, newsstand, and Starbucks (SBUX) in the country. And the company has managed to make a serious go of its online-subscription service -- a real feat for a general-interest newspaper. But its parent organization, The New York Times (NYT), has still managed to lose money in the last year.
An Englishman in New York
Enter Mark Thompson, Englishman and current director general of the BBC, Britain's state-run news service. Starting in November, Thompson will become the Gray Lady's new CEO.
Thompson has spent the last eight years running the BBC, helping to keep it afloat through a time of great financial difficulty, which included an unprecedented 6,000-employee layoff.
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A CEO with financial-management skills is good news for the battered news giant, whose profits are down more than $120 million in the last 12 months alone. And while the newspaper business is tough all over, News Corp. (NWS) managed to make $1.18 billion in the same period. The Washington Post (WPO), parent company of its own namesake newspaper, made more than $98 million. Gannett Company (GCI), owner of USA Today, made more than $404 million.
Doubling Down on Digital
Clearly, then, there's still an opportunity to make a healthy profit in the newspaper business. So why go to a Brit, who runs a state-operated news organization, to turn around an unabashedly for-profit American institution?
Here's what Arthur Sulzberger, Jr., publisher of the Times, had to say on the subject: "Mark is a gifted executive with strong credentials whose leadership at the BBC helped it to extend its trusted brand identity into new digital products and services."
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"Trusted brand identity" and "digital products and services" are the key words here. The Times is already one of the strongest media brands in the country, if not the world. And expansion into the digital arena is just what the doctor ordered for the newspaper's survival.
Along those lines, Thompson was responsible for the development of the BBC's highly successful online-media service, iPlayer, which he pushed through over the objections of naysayers.
Like The Times, then, the BBC has great reporting and a trusted brand: It just needed to be nudged forward into the 21st century.
Get ready, America. "All the news that's fit to print," the Times' legendary motto, is about to pick up a British accent.
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John Grgurich is regular contributor to The Motley Fool, and owns no shares of any of the companies mentioned in this article. The Motley Fool owns shares of Starbucks. Motley Fool newsletter services have recommended buying shares of Starbucks and writing covered calls on Starbucks.
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