Against a backdrop of news about the sale of major newspapers — on Monday, The Washington Post announced its sale to tech executive Jeffrey Bezos — observers may wonder what's going on with the Los Angeles Times, which has been the subject of sale speculation since its owner, Chicago-based Tribune Co., emerged from bankruptcy last year.
Does the sale of the Post and other newspapers recently to rich individuals portend the Times' eventual fate? The answer, according to some analysts: Very likely.
In February, Tribune hired outside financial firms to advise on a sale and vet potential suitors. Last month, Tribune announced its intention to split its media holdings into two companies — broadcast and newspapers, including the Times — which was seen by some analysts as a further step in prettying up the newspaper assets for sale.
And yet, there's been no word from Chicago or Spring Street on the prospects for a sale, on potential suitors or plans to sell the Times to a wealthy individual, despite the ongoing trend of newspapers exiting the pressures of Wall Street.
The Times is one of Tribune's eight daily newspapers that analysts speculated were up for sale earlier this year. The potential suitors include:
- Southern Californian Aaron Kushner, the publisher of the Orange County Register;
- Former deputy mayor Austin Beutner and his group of potential buyers;
- Philanthropist Eli Broad, who is was interested in working with foundations and other wealthy families to buy the Times;
- News Corp. Chairman Rupert Murdoch;
- Charles and David Koch, the controversial brothers who operate Wichita-based Koch Industries and are supporters of conservative causes.
Meanwhile, other wealthy entrepreneurs have been buying up newspapers with regularity.
- Last week, The New York Times Co. said it would sell the Boston Globe to Boston Red Sox principal owner John Henry.
- Just two years ago, developer Doug Manchester bought San Diego’s iconic newspaper and changed its name to U-T San Diego.
Newspapers are struggling to show high enough profits for shareholders, due to declining print advertising revenues. And corporations are looking for ways to get out of the newspaper business.
“Only wealthy people can do it,” said media consultant Alan Mutter. “They are now becoming rich men’s toys.”
What wealthy people want
Whether that's a good or a bad thing, depends on what the wealthy people want to do with their toys, Mutter said.
“If they want to pursue a political point of view, or commercial point of view, it may not necessarily be good for journalism," Mutter said.
Is the L.A. Times next?
Don't hold your breath. Any sale of the Tribune papers will be delayed, analysts said, because Tribune's plans to spin-off its newspapers into its own separate business will take time.
The spinoff will also require regulatory approval.
Tribune Co. has said the separation will help give more financial and operational focus on its businesses and allow it continue to explore its “strategic alternatives for maximizing shareholder value.”
But media analyst Ken Doctor believes the paper will be sold eventually.
“I think ultimately they will pass into new hands into new ownership, but it will take six months, a year or more at this point,” Doctor said.
And Mutter thinks the new owners will likely be wealthy individuals.
“Every new owner will have a different motivation, and profit is probably not going to be the primary motivation," he said. "It’s something beyond that.”
(GQ contributing editor Marc Ambinder posted the following reaction on Twitter. Thanks to LA Observed for pointing it out.)
Based on your previous purchases, Jeff Bezos, you might also like: — The Los Angeles Times — The Orlando Sentinel — Newsweek— Marc Ambinder (@marcambinder) August 5, 2013