When talking about poor business forecasting, how can the New York Times‘ purchase of the Boston Globe for a record $1.1 billion back in 1993 not be at the top of the list.
With the news Saturday that the Times has agreed to sell the Globe for $70 million — a 94% loss — to John Henry, the principal owner of the Boston Red Sox, this could go down in history as one of the most egregious examples of failing to predict what the future holds.
And these are the folks setting the tone on the left?
“The Boston Globe’s award-winning journalism as well as its rich history and tradition of excellence have established it as one of the most well respected media companies in the country,” Henry said in a statement published by the Globe.
Respected, but not profitable.
Since 1993, newspapers have seen a massive decline in both circulation and advertising revenue as readers shift from print to online news, as Independent Journal Review reminds us. The chart shows how severe the drop has been:
Even more egregious is the newspaper industry’s failure to adapt to the shift to digital advertising, as shown here:
The chart not only shows the devastation to newspaper print ad sales since 2006 — $20 billion in annual revenue loss — but also highlights the lethargic growth in digital ad sales.
But don’t be too quick to feel sorry for the “dead tree media,” as they are slowly adapting. Some have been able to offset their losses with digital subscriptions, although many will discover their content is not distinguishing enough to justify digital subscribers and the pay-walls will flop, according to The Atlantic.
Considering the overall picture, it makes good business sense for the industry to reconsider its inherent left-wing bias that turns away so many conservative customers, but there is no sign of that happening. But then again, they have already shown how blind they can be.
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