The New York Times Company is threatening to shut down the Boston Globe:
The New York Times Company has threatened to close The Boston Globe unless labor unions agree to concessions like pay cuts and the cessation of pension contributions, according to a person briefed on the talks.
The company is looking for $20 million in savings from The Globe, which has already gone through several rounds of deep cost-cutting and staff reductions. The company does not report figures by newspaper, but executives have acknowledged that the Globe lost tens of millions of dollars last year.
The threat to close The Globe was first reported by The Globe on Friday evening on its Web site, Boston.com. The site quoted the leaders of two of the unions describing a meeting Thursday at which the company delivered the ultimatum.
It quoted an unnamed person saying that in the meeting, management said that without the concessions, The Globe would lose $85 million in 2009.
The Times Company chairman, Arthur Sulzberger Jr., and Catherine J. Mathis, chief spokeswoman for the company, each declined to comment or confirm the article.
The company paid $1.1 billion for The Globe in 1993, the highest price ever paid for a single American newspaper, and it was highly profitable through that decade. But in recent years, the erosion of advertising and newspaper circulation has been more severe in the Boston area than in most of the country.
Advertising revenue for the industry fell 16.6 percent in 2008, according to the Newspaper Association of America.
The Times Company also wants to end a provision in The Globe’s contracts that gives certain employees lifetime job guarantees.
Gee, do you think ?
Of course, one wonders what the value of a lifetime job guarantee is an dying industry.