A Reader-Owned Paper

Felix Salmon says The New York Times needs a goofy scheme:

Personally, I think this is a really good idea: give every print subscriber one Class B voting share of NYT stock, and then give them one more share every three months thereafter, assuming their subscription is still in good standing. The securities would automatically convert to Class A shares if they were sold or transferred, or if the subscriber let his subscription lapse.

The cost of such a scheme would not be great: NYT shares closed today at $16.59 apiece, compared to a standard subscription rate of $10.20 a week, or $530 a year. But the votes of the NYT subscribers would be a formidable force to be reckoned with for anybody seeking to shake up the company, and they could almost certainly be relied upon to vote for the best possible journalism, rather than the highest possible share price.

But isn't this just going to lead to some takeover artist somewhere buying a huge number of Times subscriptions, thus gaining control of the company at a discount? Presumably you could write a rule to get around this -- no more than one subscription per person. Probably the world would be more interesting with more whacky business schemes like this out there. I feel, though, that it wouldn't be good for Bill Kristol's employment prospects.

Comments

The cost of such a scheme would not be great: NYT shares closed today at $16.59 apiece, compared to a standard subscription rate of $10.20 a week, or $530 a year.

I think that if someone was willing to buy half the company's shares at $530 apiece (1 per subscription) rather than $16.59 apiece, NYT would be ecstatic.

Posted by David Krych | June 13, 2008 1:35 PM

Sounds sort of cool--if readers have some leverage over content, the paper is likely to serve them better and circulation might thereby increase.

I'm not exactly sure, though, how this particular proposal addresses the NYT's larger problem, which is its plummeting ad revenue.

Posted by James Gary | June 13, 2008 1:42 PM

I've been waiting for someone to reverse boycott the NYT. The idea would be to gather a pool of people promising to subscribe if, say, they fire Bill Kristol.

Posted by matt | June 13, 2008 2:06 PM

I feel, though, that it wouldn't be good for Bill Kristol's employment prospects.

Alright, you sold me.

Posted by drjimcooper | June 13, 2008 2:11 PM

I feel, though, that it wouldn't be good for Bill Kristol's employment prospects.

Why would it? The NYT readership is, I reckon, full of self-proclaimed "liberals" who want "balance" in their paper. I betcha the same "liberals" who dominate our so-called liberal media read the NYT. Why would their owning the paper mean Kristol gets the boot?

Posted by DAS | June 13, 2008 2:21 PM

What no mention of 'Crack in comments' pointing to the article?

And what David said. If anything it should cause the stock price to decline due to dilution issues, but the subscription price could vary by day based on how much the shares it gives are worth at the beginning of the subscription.

Posted by crack | June 13, 2008 2:26 PM

Reader/community/worker owned businesses!! hurrah!

The country would look and act a lot differently if the majority of shares in biz entities (including pro sports teams) were held by those directly affected/involved. And, I'm not talking about the sham ownership that United Pilots/Attendents had in UAL.

There is NO reason Wall Street firms and hedge funds should control everything. Limit outside ownership to 45% or less (or single-holder ownership to

Popular capitalism should be our byword for the 21st century. If workers don't want to own their businesses, then let the company fold.

Posted by jimportlandor | June 13, 2008 2:50 PM

Kevin Carson had a recent review that addressed the sham of public ownership, among other things: http://mutualist.blogspot.com/2008/06/book-review-rebirth-of-american.html. Business always works for management, using "shareholders" as cover. As long as most of the ownership is with the people running the operation, the real owners' concerns are going to be the driving motivation.

Posted by tps12 | June 13, 2008 8:00 PM