Will Tycoons Save or Ruin Newspapers?

Today's New York Times quotes Roy Greenslade of The Evening Standard as follows: "There are five reasons for owning newspapers, and all begin with a P: profit, propaganda, political influence, prestige and public service. There's no profit in The Standard,so you've got to look at the other things." His comments were provoked by the fact that The Standard is about to have a new owner: Aleksandr Y. Lebedev, the former K.G.B. spy who has become a billionaire banker.

Greenslade's formula resembles the ownership typology that I set forth a year ago in a paper called "Leading the Way to Better News: How the Powers that Be became the Powers that Were." But something essential has changed during that year. The profit motive has become elusive, at best, and now seems more fit for nostalgia than investment decisions. Hopefully new solutions, or a turnaround in the national economy will lead publications back to profitability. But the sugar-daddy solution is looking more and more attractive - and inevitable.

Enter Carlos Slim, the Mexican businessman, second richest man in the world, and now savior of the New York Times. No doubt we will quickly learn more about what Carlos Slim and the Times have in mind. Maybe his loan/investment is a temporary fix. But for papers owned by companies that have no other major source of income - companies that were not as wise as the Washington Post Company, which is kept profitable by the hugely successful Kaplan, Inc. - the tycoon solution may become an increasingly common "solution." If that happens, hopefully their primary motive will be prestige and public service, not propaganda and political influence. But don't count on it.