1:24 pm Aug. 16, 2012
Some new corporate jargon is being tossed around at The New York Times Company's 8th Avenue headquarters: A growth strategy known as "Invest in the Times."
For a company named after its flagship newspaper, "Invest in the Times" may not actually sound like much of a strategy. But after decades of scrambling to ride the digital wave by buying digital media properties like About.com, Abuzz, and others, while continuing to run newspapers in various other American cities as well as part of a Boston baseball team, a classical music radio station and television network affiliates in nine markets outside of New York, consolidating efforts around the Times is still a relatively recent development, and one that has been accelerated in recent months.
Spearheaded by Times Company chairman Arthur Sulzberger Jr., the goal of the program, which until recently had been called "Invest in the Core," is to extend the reach of the Times brand by increasing investment in four areas—mobile, video, social engagement, and new global markets—with resources made available partially by the sale of other properties.
Various proposals for new projects in these four main areas have been presented to the company's board of directors, according to people familiar with the plans. Depending on which ones move forward, dozens upon dozens of new employees could be hired to work on "major initiatives" at the Times, sources said.
"At our company, we are focusing on four very specific areas for investment because we believe in each, there is real growth potential, giving us the ability to monetize our content and remain true to our core values," Sulzberger said at a conference in London on April 16, when he mentioned the strategy publicly for the first time, though not by name. "They are: mobile offerings, social media, global reach and video," he said.
The print edition of The New York Times, it's worth noting, was not targeted as one of the four investment areas, underscoring the company's belief that newsprint is not the key to its future.
"Invest in the Times" was set in motion back in February following the company's annual executive off-site meeting (which now actually takes place on-site, on the 15th floor of the Times building), in which Sulzberger and about 70 top editorial and business-side people met for two days to discuss the state and direction of the organization. All the top masthead figures participated, including executive editor Jill Abramson, president and general manager Scott Heekin-Canedy, nytimes.com chief Denise Warren, and so on.
From that meeting, task forces were deployed to develop proposals for new Times investments. They were presented to the company's board of directors sometime in June, sources said.
The scope of new projects being proposed under the "Invest in the Times" rubric and what exactly they entail is unclear. But at least one project that was already underway has been swept up into the momentum—a Chinese-language news website that was launched June 28 with a staff of 30. Sulzberger described the site on an earnings call last month as "the first step in our new international strategy, which will extend the global reach of the Times and expand our international audience." (It was in the works as long ago as September, when foreign editor Joe Kahn first told Capital about it.)
A Times spokeswoman declined to say whether any new projects had been green-lighted, stressing that "Invest in the Times" is "an ongoing strategic vision for the company moving forward" as opposed to a finite batch of initiatives.
"There will certainly be further initiatives coming out of each of these categories, but we're not prepared to announce any at this time," she said.
For awhile, there was a big question hanging over the enterprise: To what extent would "Invest in the Times" begin to take shape before a permanent C.E.O. was named to replace Janet Robinson, the longtime executive who was sent packing last December with a $24 million golden parachute after she reportedly clashed with fellow Times Company brass?
The answer came this week, as the Times Company announced it had found its new C.E.O. after being on the hunt for eight long months. The crown was handed to Mark Thompson, outgoing director-general of the BBC.
In the bizarre structure of the Times, Sulzberger ranks below the Times Company C.E.O. as publisher of The New York Times but above him or her as chairman of the board of directors. This has created a perception that no matter what, the new C.E.O. was always going to be a functionary of Sulzberger, who had taken over the job on an interim basis after Robinson was ousted.
And in fact, there was at one point speculation that Sulzberger might scrap this "pretzel logic," as it has been called, and keep the chief executive title for himself, something he did not quite rule out in an April earnings call, shortly after the company hired an executive search firm to assist in filling the role.
Whether or not that was ever the case, by any measure, the Sulzberger interregnum was an active one. The company sold off assets and trimmed staff with the goal of becoming a leaner operation focused on its core media group, which includes The New York Times, nytimes.com and The International Herald Tribune. The regional papers were unloaded late last year and the Times Company sold its remaining stake in the Boston Red Sox in May. Speculation persists that it is eyeing a sale of its other major newspaper, The Boston Globe, as well. The company confirmed last week that it is in discussions to sell About.com, which was largely responsible for its 26.4-percent net loss of around $88.2 million in the second quarter of 2012. (Bloomberg's Edmund Lee reports that the Times Company "would have about $840 million in cash and short-term investments" if it sold About.com)
At any rate, the "Invest in the Times" strategy was developed without a specific C.E.O. in mind—thereby setting the parameters for Thompson in advance. Thompson's role is essentially laid out for him now: To replicate some of the BBC's recent (if, some argue, marginal) successes in digital, and to make an aggressive play in the global media market (something the BBC has been at for decades).
The Times will need to globalize in order to continue to scale its success with the other strategy it's relying on to drive growth in the face of a spiraling advertising market: paid digital subscriptions, which have outperformed projections in the U.S. but cannot scale forever without reaching a global market. (Having siphoned more than 509,000 online and mobile subscribers to the Times and the IHT since it launched last March, the paid model is one legacy of Robinson's tenure that is not, apparently, in jeopardy.)
And the fact that Thompson has no history in print is being paraded by Sulzberger as an asset to wary activist shareholders who worry about the precipitous declines in ad revenue. The solution is not to retool the paper, but to turn the company's primary attention elsewhere.
“We have people who understand print very well, the best in the business,” Sulzberger told Times media reporters in an interview about Thompson. “We have people who understand advertising well, the best in the business. But our future is on to video, to social, to mobile."
Thompson, whose digital bona fides were touted Tuesday in a company press release, is credited with success in these areas, having expanded the multimedia offerings and digital products of a public British broadcaster that has the same international gravitas and august reputation as the Times.
Although some have pointed out that Thompson is not by any stretch of the imagination a digital guru, even skeptics acknowledge that he was good at harnessing the strong digital operation already on the ground when he took over the BBC. The argument lines up well with Janet Robinson's talking points upon the exit late last year of the paper's long-time digital chieftain, Martin Niesenholtz, with whom she reportedly did not get along.
"I think Martin would be the first to agree that one of the most important parts of his legacy is that he's built an outstanding team of professionals that have moved our progress forward," Robinson said at a media conference on Monday, Dec. 5. "They are very, very well versed in regard to what they're doing now and what they need to do to advance the digital operations of The New York Times Company."
Then again, on Friday of that same week, Robinson was fired.
For his part, Thompson hasn't wasted any time getting up to speed. He was spotted Wednesday chatting with staffers in the Times cafeteria along with Sulzberger and Michael Golden, vice chairman of the Times Company (and a fellow member of the Ochs-Sulzberger clan, which controls the company through a two-tiered stock-ownership structure). Later that afternoon, he lunched with the company's senior management team.