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Boston Globe avoids shutdown – at least for now

Could it produce a prototype that other struggling big-city newspapers could use to survive the current recession?

By Staff writer of The Christian Science Monitor, Bridget HuberContributor to The Christian Science Monitor / May 5, 2009

New York and Boston

The Boston Globe will survive for at least another day, but the economic problems dogging New England's storied newspaper are reflective of an entire industry in the midst of a historic, wrenching transformation.

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The Globe, which is owned by The New York Times Co., is reportedly on track to lose $85 million this year. That's almost a third of its operating costs. The owners, which had threatened to file a formal notice of intention to shut the paper down in 60 days, said Monday morning that they will defer that filing because they reached agreements with six of the Globe's seven unions.

Media analysts are watching closely how the Globe and the Times deal with the paper's daunting losses. Some hope the decisions could produce a prototype that other struggling big-city newspapers could model to survive the current recession, during which advertising revenues have plummeted and both readers and advertisers have flocked to Internet.

Boston Globe spokesman Robert Powers said the Globe is "very pleased" with the progress made so far, even though it's "disappointed" not to have reached agreement with its largest union, the Boston Newspaper Guild.

"Because of that, we are evaluating our alternatives under both the Guild contract and applicable law to achieve as quickly as possible the workplace flexibility and remaining cost savings we need to help put The Globe on a sound financial footing," he said in a statement issued late Monday morning.

There has been some speculation that the Times is attempting to cut costs at the Globe to sell the Boston paper, which it bought in 1993 for $1.1 billion. Sources have told The Christian Science Monitor that the Times is negotiating with at least one group of investors, although under very strict guidelines, including that any talks be kept strictly private. New York Times Co. spokeswoman Catherine Mathis said in an e-mail: "It is our longstanding policy not to comment on rumors concerning potential acquisitions or divestitures."

The New York Times Co. had originally set a May 1 deadline for the Globe's unions to agree to $20 million in cuts, half of which are to come from the Guild. It extended the deadline through the weekend before negotiations reached an impasse Monday morning. Talks are expected to continue, although specific times have not been disclosed.

At issue have been salary cuts, as well as an end to lifetime job guarantees and other benefit protections.

"It does reflect the sudden changes in the business: Just the concept of lifetime job guarantees obviously seems outlandish today," says Matt Storin, a former editor of The Boston Globe who now teaches journalism at the University of Notre Dame in Indiana.

The Boston Globe is what's known as a full-service newspaper, with bureaus around the United States and the world producing news tailored to Boston and New England readers. Mr. Storin says "it's obvious" that doesn't work anymore because of the expense of that type of reporting.

"It's vital the Globe survives, but it's going to have to survive as a niche publication, the niche being authoritative and investigative journalism within those confines of Boston and New England," he says. "Ironically, it's sort of what the Globe was ... in the mid 1960s when [former editor] Tom Winship took over the paper and remade it."

But some Boston readers would like the Globe to remain as it is, even if it costs them more.

"If this city loses its newspaper of record, it will be very destructive," says Todd Lee, an architect who has subscribed to the Globe since 1977. "We all, the citizenry, benefit from having a forum that's not tailored to special interests, but to general readership."