The New York Times' guest list shows the Globe sale is all about the cash

The rock-solid Beth Healy of the Boston Globe reports today that two of the three suitors for her newspaper - Platinum Equity Group of Beverly Hills and a group led by Stephen Taylor, a member of the family that once owned the Globe - have been invited by the New York Times to meetings and a tour at Morrissey Boulevard.

Notably excluded: The group led by Boston Celtics co-owner Stephen Pagliuca and former advertising executive Jack Connors.

The difference between the invitees and the snubbed? Platinum and the Taylor group have both submitted bids of $35 million in cash, while the Pagliuca-Connors group has offered no cash and has instead proposed establishing a non-profit foundation to own the Globe. All bidders in the Globe sale (which includes the Worcester Telegram & Gazette) have reportedly been told they should expect to assume $59 million in unfunded pension liabilities.

I've been writing for a while that the New York Times is all about dumping non-core assets for cash right now, and this story certainly supports that, notwithstanding the recent posturing by publisher Arthur O. Sulzberger Jr. and CEO Janet Robinson about the Times supposedly not being in any hurry to sell. (Somebody please tell me how having potential buyers at the Globe next month shows the Times is all of a sudden nonchalant about selling the paper.) Meanwhile, in the same Globe interview, Sulzberger also said that price "is not the only consideration" in the Globe sale.

Oh really? Is that why the Times is apparently going for the cash while excluding the bidder that may have the best chance of ensuring the Globe's continued survival as a quality newspaper?

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Anyone with illusions about what Platinum Equity and its billionaire owner Tom Gores are about need only to look at what's happened at the San Diego Union-Tribune, which Platinum acquired in May. Aggressive cost slashing has the paper eking out a $5 million profit for 2009, but San Diego locals say the U-T is now a shell of its former self. (Although in fairness, much of the cutting happened under the newspaper's former owners and the U-T is now helping underwrite a nonprofit investigative journalism operation that will have a close relationship with the newspaper.)

The Taylor group, meanwhile, gets a qualified nod from our friend and regular panelist Dan Kennedy on his Media Nation blog. Dan's sources tell him that Stephen Taylor is one of the sharper members of his family and a decent guy.  Point taken. But Taylor is still planning to run the Globe as a for-profit, which I just don't see as being in the long-term interest of New England news consumers, no matter how good as stewards the Taylors may have been in the past.

The Columbia Journalism Review analysis of newspaper ad revenues I wrote about earlier shows that the economic perfect storm (declining advertising revenue, rising costs, readers moving online) that has driven the Globe and many other newspapers to the brink of extinction is still out there. But with the recession bottoming out and advertising on a slight rebound, we may indeed be entering a couple of years of revenue bounce-back. Call it the eye of the newspaper storm.

While times are momentarily good again, a for-profit owner of the Globe will do what for-profit owners do: Pocket the money. And when the revenue storm closes in again - as it most certainly will - more damaging cuts are sure to follow. A nonprofit owner, though, could plow those fleeting profits in a higher-quality and more innovative product - perhaps even one with some content valuable enough that users will pay for online access.

Newspaper owners missed their first chance to embrace the Internet Age when times were flush, pocketing their piles of profits instead of using them to fend off innovators like Craigslist, Monster.com and Autotrader.com, who were eating away at their business model like termites in a lumberyard. Yet the coming recovery could offer newspapers that rarest of business opportunities - a do-over - if owners have the guts to admit once and for all that the era of for-profit newspapering is over.

Just don't expect it to happen here. Instead, the Times Co. seems bent on dumping the Globe to the highest bidder so it can pay down 3 percent of its debt. Oh, happy day.

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