Writing in the January/February edition of the Atlantic, Michael Hirschorn concedes that while the prospects for the New York Times to go out of business are "slim," the economics are downright scary:
Earnings reports released by the New York Times Company in October indicate that drastic measures will have to be taken over the next five months or the paper will default on some $400million in debt. With more than $1billion in debt already on the books, only $46million in cash reserves as of October, and no clear way to tap into the capital markets (the company's debt was recently reduced to junk status), the paper's future doesn't look good.
That's really the only evidence he marshals, because his story, in point of fact, is not about the imminent financial demise of the Times. It's about a future without the print edition of the Times -- where the digital version becomes the mainstay of the brand and all the news that's left to print, (perhaps) is saved for Sunday.
In this scenario, nytimes.com would begin to resemble a bigger, better, and less partisan version of the Huffington Post which, until someone smarter or more deep-pocketed comes along, is the prototype for the future of journalism: a healthy dose of aggregation, a wide range of contributors, and a growing offering of original reporting. This combination has allowed the HuffPo to digest the news that matters most to its readers at minimal cost, while it focuses resources in the highest-impact areas. What the HuffPo does not have, at least not yet, is a roster of contributors who can set agendas, conduct in-depth investigations, or break high-level news. But the post-print Times still would.
Anyway, the Times corporation is having none of it. According to a letter they've sent the Atlantic (and 'cced to the trade press), the Times has about $800 million in credit through 2011 -- plenty to keep the paper afloat until then. SVP Catherine Mathis has this to say about Hirschorn's real argument:
With regard to the specific point made about the demise of the print edition of The Times in May, it may make for a good a story but it is poor analysis. We have 830,000 loyal readers who have subscribed to The New York Times for more than two years, a number that has increased by about a third over the past decade. They like reading the print edition and pay a substantial amount of money to do so. That's not to say they don't visit NYTimes.com or read our journalism on their mobile devices. They do. But they would be unhappy if they couldn't pick up a print copy. And since it's profitable for us to print these copies, we will continue to do so.
This is a challenging time in our industry and for the U.S. economy. Employees are concerned about their jobs. People in the media industry are working extraordinarily hard to find creative solutions to the issues they face. It is a time for clear thinking and analysis, not uninformed speculation.
I'm not sure where I come down on this. Many of my colleagues who've made their careers and developed their identities online believe that brand credentialing is a thing of a past; it matters not where you work, it matters what you do. I don't think this is yet the case. There is something to be said for traditional forms of media these days: the structure of the White House is set up to communicate with them. Assume two reporters of equal capacity and intelligence; one works for the Politico and one works for the Times. Who gets David Axelrod to return their calls first? The Times will win out, always. That's not to say that the Politico won't get its calls returned, just that even the Obama communications staff has a bias toward authority, history and reach. The New York Times still means something. The Washington Post means something. The Wall Street Journal does, too. One question: will the administration use Obama 2.0 -- whatever it is -- to give supporters a preview of White House announcements? These'd be the same type of previews that White Houses traditionally give only to reporters and select constituency groups.... If so, will the Obama White House contribute to the process that further discredits -- or decredentializes -- the establishment media?
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