Jun. 25, 2009
paidContent - NYTCo Memo: May Has Come And Gone, And We're Still Printing
The Atlantic’s Michael Hirschorn declared in January that the New York Times (NYSE: NYT) is in such dire straits that its printing presses could come to a halt as early as May. Well, it’s now well into June, the NYT’s top brass points out in a memo to staff today, and the paper is still rolling off the presses. The NYTCo is fed up with all the rumor mongering about the company’s future, and isn’t going to take it anymore. The memo from President and CEO Janet Robinson and Publisher/Chairman Arthur Sulzberger to staff (via Nieman Lab), is after the jump. Robinson and Sulzberger say it is the first of what will be frequent memos to staff. Future missives in the series will cover the NYTCo’s financial dealings, advertising, circulation, costs and the digital challenges.
On the Record . . . From Arthur + Janet
June 25, 2009
To Our Colleagues,
The month of May came and went and, contrary to the prediction of one writer, we did not stop printing The New York Times. But given all the speculation and incorrect information that has been reported about our Company, we think it is important to create a regular letter written so that you get the facts directly from us on the record. In the first of what we expect will be frequent e-mails, we’d like to talk about recent events at The Boston Globe. Future letters will discuss financial transactions, advertising, circulation, costs and the digital challenges we face as well as other issues as they arise.
All of you know, only too well, that this has been a difficult time for the economy, the industry and our Company. The recession has amplified the downward secular trends in our business and caused steep declines in advertising revenue, particularly in the recruitment, real estate and automotive categories.
The Globe was one of the first metropolitan newspapers to be deeply affected by the secular and cyclical forces that are now roiling the entire media industry. Revenues at the New England Media Group (which includes the Globe, Boston.com, the Worcester Telegram & Gazette and its Web site) have declined from $700 million in 2004 to $524 million last year.
In the fall of 2008, the Globe and Boston.com developed a strategic plan to deal with their operating loss, which earlier this year was projected to be roughly $85 million in 2009. The plan has several components to increase revenues and lower costs. Here are the strategic steps we have taken:
—We have just completed the consolidation of printing facilities in Boston, which is expected to save $18 million a year.
—In the last month, we significantly raised prices on newsstand and home-delivered copies of the paper.
—The compensation of the Globe’s managers and other nonunion employees were significantly reduced in 2009/2010 through a salary reduction and elimination of their annual incentive plan.
—The Globe’s labor contracts are being restructured in order to save $20 million in annual operating costs essential to our turnaround plan. We had reached agreements with seven unions that provided slightly more than $10 million in savings. Yesterday we reached an agreement, which is subject to ratification, with the Boston Newspaper Guild, which would provide us with another $10 million in expense reductions.
There will be still more to come but with these steps the Globe is on a path to a more secure financial future. We are deeply grateful to all of our colleagues in Boston fo the hard work and sacrifices they have made to put the Globe on a stronger financial footing.
In future letters, you’ll hear from us about other things we are doing to strengthen our Company and prepare us for the future. These are tough times and we recognize that all of you are working very hard to make tomorrow better than today.
Thank you, we deeply appreciate it.
Arthur & Janet
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