The Boston Globe could not have found a better buyer than John Henry: He’s rich, he’s local, he’s independent, and he’s willing to take risks.
Better yet, Henry made his billion-plus in finance, and what The Boston Globe — and all of American journalism — needs today are owners with the financial acumen and the daring to at worst speed up, and at best reinvent, the way news organizations do business.
The newspaper business doesn’t have a journalism problem, it has a business model problem. Henry built one business model — a commodities hedge fund — that made him a billionaire. His business model for the Red Sox led to the team selling out Fenway Park for 820 games (or thereabouts).
The newspaper business doesn’t have a journalism problem, it has a business model problem.
Henry bought the Globe with, essentially, the loose change on his bureau: $70 million. His Fenway Sports Group already owns the Red Sox and Fenway (estimated worth: $1.3 billion), the Liverpool soccer team ($651 million), Roush Fenway Racing ($166m), and a majority interest in the New England Sports Network. The Globe fits into the sports, entertainment and media empire Henry is building.
The profitability of these companies is unknown to the public, since they are all privately held, but the way they have been managed makes it clear Henry does not buy properties for ego purposes or for an overwhelming sense of civic duty — he buys them because he believes he can make money from them.
(Let me pause here for a moment and address the question that everyone seems to be talking about: Will John Henry’s ownership of the Globe change the paper’s coverage of the Red Sox? If you’ve ever known or worked for a newspaper owner, the answer is as obvious. Of course it will change the coverage. Why would the owner of the Globe let the newspaper take cheap shots at the $1.3 billion business he also owns — a business that depends upon the goodwill of the public? He won’t.)
For those of you who miss the glory days of newspapers, Henry (and Jeff Bezos of Amazon, who bought the Washington Post on Monday) are bringing back one of the most important elements of those days: private ownership that does not need to report quarterly to shareholders.
In other words, Henry is free to invest — and to lose — as much money as he cares to. He and his partners invested an enormous amount of money in the Red Sox, as well as Fenway Park and the surrounding area. I expect him to do the same with The Boston Globe.
I’m not going to give John Henry business advice on how to save a major news organization, for a couple of very good reasons: He’s a far better businessman than I, and if I knew how to solve journalism’s business problems I wouldn’t be writing this. I’d be off somewhere counting my money.
But I hope Henry keeps Brian McGrory in place as editor. In his first months in the job, McGrory has brought some liveliness back to a newspaper that had grown a little stuffy. But the most important hire Henry will make at the Globe will probably be his first: a publisher. Henry isn’t going to spend 50 hours a week on Morrissey Boulevard with his sleeves rolled up, so let’s hope he hires someone who can work well with McGrory and the Globe’s top editors — and who can keep pushing the Globe newsroom to be more creative with its online editions.
A newspaper is like any other business — it needs more cash coming in than going out. If anyone can do that at the Globe, it’s John Henry.
Reaction around town to Henry’s purchase of the Globe runs from “forget it, it’s too late” to “Henry just might be the guy to turn things around.” George Donnelly, the editor of the Boston Business Journal who has worked in newspapers in Boston for more than 30 years, suggests Henry “hasn’t yet realized he bought himself a $70 million ass-ache.”
Henry’s purchase of the Globe was optimistically welcomed by, of all people, the editors of The Boston Herald, who wrote in an editorial: “The fact that The New York Times has found a buyer for The Boston Globe and its related properties — and a financially savvy buyer at that — is indeed good news for the community.” The last line of the editorial said: “And just one other small bit of newspaper wisdom — it’s a helluva lot harder than it looks from the outside.”
Actually, it’s not, despite what newspaper people like to think. A newspaper is like any other business — it needs more cash coming in than going out. If anyone can do that at the Globe, it’s John Henry.