Your mother said you only have one chance to make a good first impression. New Baltimore Sun owner David D. Smith spectacularly failed to do so in a two-hour-plus meeting Tuesday with the Sun’s news staff.
Respectful listening is the default mode for such get-togethers. Instead, Smith, the architect of the Sinclair local broadcast empire, flaunted his ignorance of the Sun’s journalism and business challenges.
He admitted to almost never reading the Sun over the last four decades. Why, then, would he want to buy it? Without the benefit of having read it, he nonetheless confidently told the Sun staff their work was inferior to that produced by Sinclair’s local TV station.
He did nothing to dispel fears that he would infuse right-wing politics into news and editorials, calling for more investigations of local political corruption, as the Sun has a distinguished record over many years leading to many indictments.
One day is too soon to judge this match as an impending disaster. But for me, the start of the Smith regime brings back ghosts of terrible rich person owners/bosses past, history for which no one is nostalgic.
In particular, Smith is reminiscent of the Sam Zell years at Tribune Co. Zell, who died last year, was a cantankerous, foul-mouthed character who made it big in bottom-feeding real estate deals. He was confident he had the savvy to master the unfamiliar newspaper business, too.
He too had an unfortunate first tour to greet the troops in 2008. When an Orlando Sentinel photographer asked a series of persistent questions, Zell muttered an F-bomb into an open mic and gave her the finger. The company filed for bankruptcy within a year.
At the company’s flagship Chicago Tribune, he installed broadcast executives who came to be known as “the radio guys.” They turned the place into a sexist frat house, as documented in a delicious New York Times exposé by the late David Carr. Between poker games, the radio guys managed by drafting long, incoherent memos.
You get the idea. Will a cadre of Smith’s favorite TV talent be arriving soon at the Sun to tell the newspaper people how to do their jobs?
Smith’s political contributions and his installation of conservative commentator Armstrong Williams as part owner have already dismayed locals on the left. At the meeting, he ratcheted up, indicating his top focus for government reform is a conservative critique of public schools he wants the Sun to adopt.
I called Smith for comment, but a representative replied that he is not doing media right now.
Rich owners have every right to set an agenda, but the smart ones like The Washington Post’s Jeff Bezos think that’s an affront to sound journalism, and a bad business practice, too.
By contrast, Wendy McCaw, with a divorce settlement from tech entrepreneur Craig McCaw, bought the Santa Barbara News-Press at an inflated price from The New York Times Co. in 2000. She quickly made shambles of it, promoting pet causes and filing lawsuits left and right.
Doug “Papa Doug” Manchester used his six-year ownership of The San Diego Union-Tribune to push his plans for downtown redevelopment with numerous stories and editorials.
Besides issues of how he will run the Sun, one other nugget from Tuesday’s staff meeting was that Smith said he paid nine figures for the Sun and its group of smaller papers. That would mean $100 million or more — a big markup on what Stewart W. Bainum Jr. offered in early 2021 during comparatively better times for the industry.
The total makes more sense if Smith was adding in what he will be paying seller Alden Global Capital for needed technology and other services. As I wrote Wednesday, that probably was important in sweetening the deal enough for Alden to sell.
When he broke off talks with Alden, Bainum said that the proposed terms of the service agreements were the sticking point. I asked him how much money was in play, and he replied by email:
We had agreed with Heath (Freeman of Alden) to pay Tribune $11-12M for the first year. We felt we only needed 18 months, so that would have been like $18M, but Heath wanted a five year agreement and he wanted to have the sole right to set the annual payment in years 2-5, which we, of course, wouldn’t accept. We finally agreed to two years, but they insisted on five. That’s when we fell out.
Even in straightforward negotiations for a single newspaper, buyers from outside the industry typically engage highly knowledgeable consultants. If Smith has those, they so far haven’t counseled him well or he has sped past the speed bumps to do what he wants.
This is one of those instances where I hope my media business analysis proves over time to be wrong. I fear, though, that we have seen this movie before — and it doesn’t end well.
