Tuesday, May 27, 2014



In 1997, the management of Naspers and the New York Times were each confronting dawn on the Internet and the insidious challenge it posed to the mere idea of a "paper of record," expensive printing plants and truck fleets and the conceit that all important news and information could be contained in one place. In 1997, audiences were starting to have more choices than ever; there was a quickening news cycle, distribution that was instantaneous and bloggers who held intergalactic megaphones. This was before Google, Facebook, Twitter, Netflix, iTunes, Pandora and WhatsApp; before videos had been transmitted on YouTube; and before the first smartphones and appstores had put the power of yesterday’s supercomputers in everyone’s’ pockets. It was also before it was obvious that people could buy a song rather than an album, catapult directly to a product page on Amazon, watch a TV show when they wanted, scan news aggregation sites for the latest headlines, dip into specialty sites for detailed coverage and, most importantly, it was way before most sponsors had woken to the fact that were now ways to accurately measure how their advertisements performed.

The management of Naspers decided to ride, rather than fight, the technology tide while the management of the New York Times chose otherwise. Today, coincidentally, both companies have fairly new CEOs, and while the head of the New York Times has to deal with the consequences of twenty years of ruinous decisions, his counterpart at Naspers has been dealt a royal flush. The New York Times CEO inherited a company that missed not just one but two media revolutions - television (mastered in a spectacular manner by Rupert Murdoch) and online (mastered by Koos Bekker, CEO of Naspers) [..].

Between the early 1990s and mid 2000s, the management of the New York Times spent around $2 billion (not including a real estate adventure in midtown Manhattan) on assets that later melted down. The Boston Globe (bought for $1.3 billion) and Worcester Telegram & Gazette (bought for $296 million in 1999) were sold last year for $70 million. About.com, bought in 2005 for over $400 million, was later offloaded to IAC for about $300 million. Even more embarrassing was the use of $600 million of cash to repurchase stock of the company. In 2000 – admittedly the height of the dot.com zaniness – the New York Times had revenues of $3.6 billion and operating profit of $635 million. Last year, its revenues were $1.6 billion and operating profit was $158 million.

Q&A - 19/6

Bank of England The vast majority of money held by the public takes the form of bank deposits. But where the stock of bank deposits com...