What Does the NY Times Want From Boston?

(MoneyWatch)  The long-anticipated vote by Newspaper Guild members at the Boston Globe is in, and management's proposal to cut wages and benefits by $10 million was rejected by a 51-49 percent margin. Management, of course, is The New York Times, which now says it will unilaterally impose a 23 percent salary cut on all the union's members, starting next week.

A cynic might say the Times got exactly the result it wanted from this vote. After all, neither Chair Arthur Sulzberger nor CEO Janet Robinson paid a single visit to the Globe to explain the proposal to employees, or apologize for bringing a proud metropolitan newspaper to the brink of extinction.

Observers in Boston say this hands-off, remote control is widely interpreted as callousness by those in Beantown.

The Globe was founded 137 years ago by six Boston businessmen who collectively invested $150,000. It remained a private, independent company for 101 years, before going public in 1973. Twenty years later, Sulzberger & Co. made the fateful decision to buy the Globe for the massive price tag of $1.1 billion.

Under the Times' management, the Globe has turned into a losing division inside a company that is struggling to manage a large debt load -- roughly the size of the Globe purchase. The Times sustained a net loss of $57.8 million for 2008, $50 million or ~86.5 percent of which it pinned on operating losses at the Globe.

The Times then posted a staggering $74.5 million loss in Q-1 this year, and projected that without the concessions it has demanded by union members that losses at the Globe would reach $85 million this year. The Times has also threatened to close the Globe down entirely -- an outcome that now seems more likely in the wake of the union vote.