David Geffen, one of Hollywood’s most hallowed players, has roused the newspaper industry with his recent offer to purchase a large stake in the the New York Times. On May 11, Fortune Magazine revealed that Geffen was shopping for the 19% share held by the hedge fund Harbinger Capital Partners. No deal was dealt. And only weeks before, Harbinger proposed a pact with Google co-founder Larry Page to buy the Times Co. though the Google co-founders, who recently purchased a fighter jet, turned it down. Regarding the hedge fund’s approach to Google, the Times chairman Arthur Sulzberger Jr. told Fortune’s Richard Siklos, “Things to worry about, things not.”
The Times executive editor Bill Keller ponders a pertinent issue: “How you remake the business model for the long haul.” While the newspaper industry is being folded like flour into the dough of the doyens of Web 2.0, the Times is doing relatively well, having taken steps to stay alive like putting up for sale its stock in the Boston Red Sox and cutting costs at the Boston Globe. While the industry is imperiled, the Times may find salvation through adaptation to the practicalities of modern media. But is it worth adapting?
There are still some who believe in the power of paper, the advantages of editorial analysis, and/or simply don’t want to witness the demise of one of the greatest icons of American tradition. Those close to Geffen say, “He believes it is the most important newspaper in the US – and it needs protecting.” Geffen won’t make a hostile bid. According to an article in the Financial Times, Geffen’s offer was made at the market price, far below the $500 million Harbinger paid in 2007. But Harbinger wanted a premium. Geffen remains willing. And there’s speculation that the Ochs-Sulzberger family, which owns the paper, is looking to sell (see New York Magazine’s “Bleeding ‘Times’ Blood.”)
Meanwhile, the Grey Lady is working hard to up her sex appeal aiming for a slenderer look, fewer appearances, appearances potentially to a more elite audience, and is even considering Kindle-type devices.
And as Geffen, the quiet suitor, stands by, another billionaire, Carlos Slim, a Mexican businessman and the third richest person in the world, according to Forbes Magazine, is eying the Times. In fact, the paper is already indebted to Slim by $250 million. But while Slim’s billions (thirty-five) far outweigh Geffen’s four, it is said that Geffen, who worked up from the mailroom at William Morris to the pinnacle of Dreamworks, is a “patient buyer.” And as good things have long been the bounty of those who wait, perhaps the Grey Lady will succumb to Geffen’s quiet perseverence.