It looks like the San Jose Mercury News is either going to be bought again (last time was 2006 for over $700 million) or it will close down. The bigger question, since newspapers are losing circulation regardless of ownership, why should a billionaire buy a newspaper just to lose money? They could spend less and lose less by buying a book store, buy stock in GM or follow an Al Gore investment in “green” energy.
Yes, the very rich have bought papers like the Washington Post—but the property had the value, not the newspaper. The rich will buy the Merc News if the paper has valuable property. The Mercury News prints once a day—everything in the paper has already been on the Internet for hours—or days. In reality it is a “history” paper, not a “news” paper.
Newspapers are today vanity toy.
“Although it’s getting harder and harder to sell a newspaper subscription to ordinary folk, the monied class clearly wants to buy titles – there’s a whole mess of would be Joseph Pulitzers looking to carve out their own media empires. And with the industry’s well-publicized troubles, the price is finally right.
It’s a trend most readily illustrated by Bezos’ $250 million purchase of the Washington Post. But you see it also in the many nameplate journalists being lured to digital publications run by deep-pocketed benefactors – publications like the Intercept, Ozy Media and Vox.”
Which billionaire might save the Mercury News?
Jon Xavier, Silicon Valley Business Journal, 4/7/14
Last week, Mercury News parent Digital First Media pulled the plug on plans to provide its regional newspapers across the country with digital content from a centralized unit dubbed Thunderdome, and a media analyst said the group’s newspapers could go on the block.
That got me thinking. Billionaires buying news outlets is becoming almost commonplace. Jeff Bezos bought the Washington Post. And Pierre Omidyar started the Intercept with NSA-busting reporter Glenn Greenwald.
So which billionaire might want to snap up the Merc? A little speculation here may prove amusing.
But first, context. It’s a very different market than the last time the Mercury News sold in 2006. In that deal, the Mercury was sold along with the rest of the former Bay Area Knight Ridder papers to privately owned MediaNews Group for $737 million.
Private equity interest in print journalism is waning, and there are fewer media giants left standing to try to extend themselves through a buy, cut and consolidate strategy the way MediaNews did. But there is one slightly anacronistic trend that adds to the list of potential buyers: The rise of the billionaire newspaper publisher.
Although it’s getting harder and harder to sell a newspaper subscription to ordinary folk, the monied class clearly wants to buy titles – there’s a whole mess of would be Joseph Pulitzers looking to carve out their own media empires. And with the industry’s well-publicized troubles, the price is finally right.
It’s a trend most readily illustrated by Bezos’ $250 million purchase of the Washington Post. But you see it also in the many nameplate journalists being lured to digital publications run by deep-pocketed benefactors – publications like the Intercept, Ozy Media and Vox.
The barriers to entry in news are now so low that you almost can’t afford not to have one if you have a certain mindset and are of certain means. If you can snatch up an established brand, so much the better.
So which billionaire would be a fit for the Mercury News? The Merc bills itself as the newspaper of Silicon Valley, and there’s certainly no shortage of money in the Silicon Valley these days.
Granted, the Mercury is sort of an anacronism itself – despite DFM’s valiant efforts to turn it into a more Internet-focused publication with Thunderdome, it remains a solidly print-focused organization.
And while the Mercury is a regional powerhouse, it lacks the national cachet of the Post, or even the Chicago Tribune or the L.A. Times, which may limit interest to people who have deep, local roots or significant ties to the region.
Still, there’s no accounting for billionaires, so here are some names to consider as future publishers of the Mercury News:
Eric Schmidt
Worth an estimated $6.5 billion, the former Google CEO and current chairman of the company could easily afford the Merc. The question is whether it could pique his interest. Google is easily bigger and more important than any news organization when it comes to affecting the flow of information.
But Schmidt is less focused on the day-to-day operations at the search giant lately and more focused on philanthropy and policy. From expanding Internet freedom and access, to raising standards of living in developing countries, Schimidt spends a lot of his time on advocacy – something that has traditionally been well served by being connected with a platform to spread your views.
Carl Berg
Billionaire real estate tycoon Carl Berg has two traits that would be absolutely critical to success as the owner of the Mercury News – he has deep, deep ties to the Silicon Valley, and he doesn’t have any skin in the game anymore. Berg sold off most of his main Mission West real estate portfolio for $1.3 billion in 2012, and since then he’s mostly been investing in early stage companies, such as a startup that’s using Big Data to battle cancer.
Evan Williams
Blogger and Twitter co-founder Evan Williams already has a media outlet, kind of. He’s the founder of Medium, which is both a blogging platform and a media outlet, giving a stable of writers mostly drawn from the tech community a platform to weigh in on a wide range of topics. Medium is an impressive system, but it lacks news content and often weight – something a stable of journalists could probably provide. Mostly though, it would be interesting to see what Williams, one of the tech industry’s foremost minds around the future of media, would do with something as low tech as a newspaper.
One of the Silicon Valley’s most prominent investors, Andreessen is also a bit more connected to the local community than your average tech billionaire through his wife, Laura Arillaga-Andressen, a scion of the prominent Arillaga family and an active Silicon Valley philanthropist. The rub, of course, is whether or not Andreessen would even want to deal with something as analog as a newspaper — this is the man that once said software is eating the world, and that presumably includes newspapers.
Ebay founder Pierre Omidyar is another one with his own thing going — he’s put his money behind a online news magazine called The Intercept which has drawn big names like Glenn Greenwald, Laura Poitras and Gawker editor John Cook. But Omidyar’s company, First Look Media, is intended to be a umbrella organization for many different publications, and while so far the publication strategy has been for verticals tightly focused around a single topic, there’s no reason why one of those verticals couldn’t be a newspaper. Omidyar seems committed to investigative journalism, so perhaps that’s the best possible outcome.
Gates might seem like he’d be above owning a newspaper, after all, this is a man who spends most of his time fighting polio and trying to overhaul the country’s broken education system. But as with Schmidt, there’s a virtuous connection between philanthropy and media ownership. And, oddly, there’s a precedent here. The Mercury News’ earlier sale to MediaNews in 2006 was actually funded with a $350 million loan from the Bill & Melinda Gates Foundation.
