A very fascinating look at the Machiavellian machinations of the power players at the NY Times - and what was behind the firing of the Times CEO Janet Robinson.
If you are a reader of the Times, or a New Yorker, or just looking for some good non-fiction, invest the 15 minutes or so it takes to read the feature.
Some tidbits - but read the whole thing!
As the paper’s stock price has declined in recent years, there has been increasing unease among the Ochs-Sulzberger clan, who control the paper through a special class of shares. Three years ago, facing huge debt problems, the company suspended the lucrative stock dividend that once flowed quarterly to the family’s 40-plus members, intensifying the need to solve the intractable advertising problems of the newspaper in the digital age and figure out a way to turn the family’s cash spigot back on. Janet Robinson, the company’s advertising brains, found herself caught between her increasingly remote boss and a frustrated family worried over the future of its 116-year-old fortune.
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Between the About.com debacle and the sudden decline in print advertising, the paper was headed toward a 3 percent drop in revenue and an overall loss of almost $40 million in 2011. Since Robinson began as CEO in December 2004, the Times stock has lost more than 80 percent of its value. And this was significant not only for the business but also for the family that owns it. The Times has always had conflicting business prerogatives: to turn a profit, yes, but also to supply the family with what amounted to a trust fund by churning out several million dollars a year in stock dividends. At one time, the family received upward of $20 million a year, which served as a kind of Ochs-Sulzberger operating budget. But when the dividend was suspended, the family were left with only their stock wealth and whatever they had in trust funds and savings. That was fine for Sulzberger and the five other family members with salaried positions at the company, but the wider family of sons and daughters, nieces and nephews were now forced to sell stock at a historical low to raise money. Most of them have admirable if low-wage jobs as academics, novelists, musicians, and psychotherapists, but the money also funded second homes and hobbies such as underwater exploration. Two years ago, the clan began working with a company called Relative Solutions, which specializes in brokering disputes inside wealthy families.
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In the era of Arthur Sulzberger Jr., when newspapers have flailed under new digital realities, the New York Times Company has shrunk dramatically. Once it was a wide-ranging media empire of newspapers and TV stations and websites, and even a baseball team, that was worth almost $7 billion; today it’s essentially two struggling newspapers and a much-reduced web company, all worth less than $1 billion (for comparison, consider that the Internet music company Pandora is valued at almost $2 billion). Despite the shrinkage, the company has retained essentially the same top-heavy management, which it has kept well compensated. Even though the paper froze executives’ pensions in 2009, as it is threatening to do with union employees, the company created two loopholes, called the Restoration Plan and the Supplemental Executive Savings Plan, which allowed certain high-earning executives to take money out anyway. As a result, Janet Robinson received an additional lump-sum payment of over half a million dollars upon exiting the Times.
Janet Robinson's total termination package came to $24 million so don't weep too much.
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