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anything
, for a story about our battle with the
Times
.
He had assembled, with art supplies, an elaborate family tree—cousins,
second cousins—with a level of detail that was downright creepy. It became
clear that the world’s media couldn’t wrap its head around how it felt about
the people who owned the media.
Arthur Sulzberger and I took an immediate, almost visceral, disliking to
one another. We saw the world differently and approached it from entirely
different angles. My whole life has been a quest to gain relevance and fear of
never achieving it, whereas Arthur’s biggest fear (I believe) was losing it.
And to be clear, he was the CEO. He gave Janet Robinson the title just so he
wouldn’t have to do the shit-work of a CEO—firing people, earnings calls,
etc. However, he made the big decisions and collected CEO-level
compensation.
The Sulzbergers, like many media families, employ a dual-class
shareholder structure to keep them in control. The thinking is that media
plays a special role in our society and should not be subject to the short-term
thinking of shareholders. Most use this (Google, Facebook, Cablevision) as a
ruse for the families to maintain control of the company while diversifying
their stake (that is, selling shares).
The Times is not one of these companies. The family is deeply committed
to journalism. And it was clear, after getting to know Arthur, that the
financial health of the
Times
was meaningful, but only in the pursuit of the
profound—the
Times
’ form of journalism. I imagine Arthur wakes up in a
cold sweat frequently, fearing he could be the cousin that loses the
New York
Times
.
So, the Sulzbergers, like many newspaper families, owned a minority of
the equity, 18 percent, but controlled ten of fifteen seats on the board. That
meant that agitators like me had to swing a whole bunch of family friends
and members to the wild side. After sharing our ideas about digital and
capital allocation, we continued to meet with shareholders to gauge support.
Annual meetings are like elections, and shareholders—in this case the Class
A shareholders—get to vote for who will represent them on the board. Most
shareholders we met with were fed up and felt the Times leadership had
mismanaged the company. Everything indicated the company was ripe for
change.
The following week, the Times’ CEO, Janet Robinson, and director Bill
Kennard asked to meet with Phil, without me, to see if we could come to a
settlement. This meant they knew they were going to lose at the shareholder
meeting. I felt Phil should demand all four seats we had nominated directors
for. But Phil said we should demonstrate some good faith and settle for two.
This was a mistake: we needed several voices to break through the
cacophony of the board’s thoughtful comments, while not holding Arthur or
Janet accountable for any real leadership.
The Times Company agreed immediately, with one condition: I wouldn’t
be one of the two (see above: visceral dislike). Phil recognized I had skin in
the game and would not be co-opted by quarterly dinners with Nick Kristoff
and Thomas Friedman, along with $200,000 in board fees (stipend and
options). Instead, I would continue to push for change. So, Phil demanded I
get one of the seats, and they acquiesced.
At the annual meeting in April 2008, Jim Kohlberg and I were elected to
the board in an unexceptional shareholder meeting. After the meeting, Arthur
asked to speak to me alone. He took me into a room and asked who the
photographer was I had brought with me. I hadn’t brought anybody with me.
Not once, but two more times, over the next hour, he pulled me into a room
and demanded that “this time” I tell him who the photographer was. “Again,
Arthur,” I replied with increasing irritation, “I have no fucking idea. Don’t
ask me again.” I don’t know if Arthur sees dead people or was so stressed
about having an uninvited guest shoved into his boardroom that he was
hallucinating. There was no photographer.
And so, our relationship began with a petty sideshow reflecting our mutual
distrust and disdain. He viewed me as an unwashed mongrel, in over his
head, who had no license to be on the board of the Gray Lady. I viewed him
as a silly rich kid with poor business judgment. Over the next couple years,
we would prove each other right.
Arthur lived and breathed the
Times
. His DNA was gray and wrapped in a
blue plastic bag. It was hard even to imagine Arthur outside the building. I
once saw him at a conference in Germany, and it was like seeing a giraffe on
the 6 subway line—it just didn’t fit.
As you might guess, I didn’t have any luck convincing the board to dump
the CEO, Janet Robinson, and replace her with Eric Schmidt, a man with a
deep understanding of the intersection between technology and media. I was
basically laughed out of the room. No one wanted to take on the CEO and
Arthur. And since I was a newcomer with no credibility, it was easy to quash
the idea.
This was several years before a tech CEO took over an ailing newspaper.
In 2013, Jeff Bezos bought the
Washington Post
. That had the salutary effect
of eliminating the quarterly freak-outs, when the paper would unveil sinking
numbers to investors, soon followed by the inevitable bloodletting in the
newsroom. More than providing financial ballast, Bezos turned the
Post
toward the web with a vengeance. Its online traffic doubled in three years,
leapfrogging the
Times
. And the
Post
developed a content management
system that it’s now leasing to other news outlets. According to the
Columbia
Journalism Review
, this CMS could generate $100 million a year.
24
WaPo
is
benefitting from the same blessing as Amazon: cheap capital and the
confidence to invest it aggressively, and deftly, for the long term, as if they
were eighteen again.
My fellow directors at the Times Company had no stomach for this type of
agita. It was a lot easier, they concluded long before I came, to confront the
online challenge by acquiring an online player and extending its model to the
web.
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