Might Google Buy the New York Times?
By John Ellis
In the last five years, the New York Times has declined in value by an astonishing 70 percent. There is no indication that things will get better any time soon. Indeed, as the specter of recession looms, there is every reason to believe that things will get worse. At some point here in the near future, the market capitalization of the New York Times will fall below $2 billion. At that point, a psychological floor will have collapsed and the company will be in play.
The company that has the most to gain from buying the New York Times is Google. If it proffered a Murdoch-like, no-auction bid of $4 billion, wouldn't the Sulzberger family have to accept it? Every single class B shareholder would accept the offer. It's their only exit. It is also likely that Times employees and retirees would enthusiastically support the deal; it's their only exit as well. So it would all come down to whether the Sulzberger family (smaller in number and not as far-flung as the fractious Bancroft clan that owned Dow Jones) would accept the deal.
First, the Sulzberger family ain't selling. Duh.
Second, why the heck would Google want to assume the liabilities of the Times company? They ain't dummies over there in Mountainview. Imagine Google's directors approving taking over thousands of union contracts, a rusty physical plant, the hundreds of lawsuits the Times faces every year, and a 19th-century business model.
For what? Google already "owns" NYTimes.com content since the Times let the spiders in. In other words, millions of people use Google to find their way to Times stories, thus enhancing Google's value every day. What would it gain by buying a content-creating company? Content hosting and linking is where it's at.
If Google were to buy the Times or any content-creating company it would no longer be Google. It would give up its Googlocity. That would be the beginning of the end.