The Finch Formerly Known As Gold

12 September 2006

No Times left for you

The New York Times Company will sell its nine television stations and refocus on its print and Internet properties.

The official company statement:

"These are well-managed and profitable stations that generate substantial cash flows and are located in attractive markets," Janet L. Robinson, the company’s president and chief executive, said in a statement.

But, she added, "We believe a divestiture would allow us to sharpen our focus on developing our newspaper and rapidly growing digital businesses, and the synergies between them, thereby increasing the value of our company for our shareholders."

And they've been expressing concerns to investors:

Our network-affiliated broadcast stations face significant competition. Several developments could cause further fragmentation of the television viewing audience and therefore increase competition, including:
  • system upgrades and technological advances resulting in increased channel capacities on cable and direct broadcast satellite systems,
  • the entry of telephone companies into the video distribution market,
  • the emergence of new portable video distribution platforms, and
  • the availability of network programming on the Internet and through video-on-demand services.

This fragmentation may adversely affect our television stations' ability to sell advertising.

Even allowing for the fact that all such statements to investors are primarily intended as CYA devices, it's no particular secret that NYT Class A stock has been tanking for almost a year, and the divestiture would put some cash in the company coffers while investors are staying away.

NYT operates television stations in eight mostly middle-sized markets, all of them solo operations except in Oklahoma City, where the company owns KFOR-TV (an affiliate of NBC) and KAUT (an affiliate of MyNetworkTV). There is no indication so far as to whether the stations will be dealt as a group or sold off to individual buyers.

Posted at 8:07 PM to Dyssynergy , Overmodulation