Jeff Bezos, the founder of Amazon, bought The Washington Post in 2013 for about $250 million. Dr. Patrick Soon-Shiong, a biotechnology and start-up billionaire, purchased The Los Angeles Times in 2018 for $500 million. Marc Benioff, the founder of the software giant Salesforce, purchased Time magazine with his wife, Lynne, for $190 million in 2018.
Time, The Washington Post and The Los Angeles Times all lost millions of dollars last year, people with knowledge of the companies’ finances have said, after considerable investment from their owners and intensive efforts to drum up new revenue streams.
The Times was on track to lose $30 million to $40 million in 2023, according to three people with knowledge of the projections.
The Post has struggled to hold onto the momentum it gained in the wake of the 2020 election. Sagging subscriptions and advertising revenue led to losses of about $100 million last year.
Time is facing similar headwinds. The publication lost around $20 million in 2023, according to two people with knowledge of the publication’s financial picture.
Fidelity has cut the valuation of its stake in Elon Musk’s X again, reflecting a 72% markdown since the billionaire bought the former Twitter Inc. a little more than a year ago.
The investment firm, which helped Musk complete the $44 billion purchase, cut the value of its holding in X by 19% in its November portfolio update for the Blue Chip Growth Fund, compared with a September filing, according to calculations by Bloomberg. It’s the latest in a series of markdowns by Fidelity since Musk concluded the acquisition of the social media platform in October 2022, as closely held X has struggled to hold on to advertisers and is weighed down by $13 billion in debt.
Do billionaires buy news media for profit or as a public service. CBS wss famous for its spending on news. Probably a loss leader but important for prestige.
Media also lets them guide the news in directions they prefer.
And recall Warren Buffett invested in local media betting it wss necessary and survive somehow. I think he lost on that one but again investing for the good of the community.
“Diworsification” has been a knock on companies getting in to fields they don’t know anything about, for a long time. Remember Boeing’s jaunt into rapid transit rail cars? Or Sikorski’s venture in passenger railroad equipment? Grumman’s Flxible city busses?
It absolutely was a loss leader and was for all the big three networks. Until CNN came around the news was not expected to make a profit. It was a public service and a prestige thing. It can be easily argued the for-profit 24 hour news channels started us down a path of awful news.
Yep. He paid a significant premium over the current stock price to buy it.
Perhaps a better headline would be: Elon Musk has wiped out 72% his and his partners’ investment in Twitter since taking over.
Putting that in dollars, he pi$$ed away around $30 billion of the $44 billion he paid.
Or if one really wanted to do the analysis, they could separate the 72% into the loss of the premium paid and the real drop in value. Without looking up the right number and just going from my feeble memory, I think he paid about 30% or so over the current price. So (continuing the errors and messing up the algebra), 30% of the loss is the premium and 42% is the actual drop in value.
Genius? Perhaps. But not a financial one. Or perhaps just the price he was willing to pay (partly with other people’s money) to make his political statements. Either way, it makes me not want to invest with him.
The other part of this is that it isn’t just the financial loss. Buffett made bad investments too when things didn’t turn out the way he thought. Musk was actually running the company. He’s the one who made it a bad investment.
It was a loss leader, but Paley spent up on it because (at that time) the FCC actually cared about what was broadcast, and was beginning to make noises about how the “public airwaves” were “a vast wasteland”. Newton Minnow, then head of the FCC was making noises about the profiteering by the networks (and the strong arm tactics on individual affiliates) and such, and one of the way Paley sought to earn brownie points was “news.”
CBS was the first network to expand the evening newscast from 15 minutes to 30, and the news department was also charged with producing some prime time programming - they made some “populist news” (Ed Murrow interviews celebrities) so they could also produce hard hitting documentaries in prime time .
Those, too, lost money, but eventually the news became profitable and the prime time stuff faded away. Oh there were attempts to revive it, sort of: 20/20, Dateline, and the granddaddy (which still exists today) “60 Minutes.”
So yeah, “prestige”, but not without a significant ulterior motive.
Given the rate that new stuff comes along, I’ve oftentimes wondered in a hypothetical sort of way, that if it were actually possible to wake up one morning knowing absolutely everything about absolutely everything, how long would it be before the gaps that opened up in that knowledge base overtook the known.
https://www.cnn.com/2024/01/23/media/los-angeles-times-layoffs-strike/index.html amid the backdrop of bedlam, the team of four managing editors — Julia Turner, Sara Yasin, Scott Kraft, and Shani Hilton — tapped to oversee operations in the wake of Merida’s departure has also been rocked by departures. Two of the four members, BuzzFeed News alums Hilton and Yasin, have in recent days exited the newspaper, contributing even further to the turmoil that has enveloped the newsroom.
“We have a billionaire who doesn’t understand media and thinks he can cut his way to success,” another staffer told me, likening the drama playing out in the editorial leadership to the reality television show “Survivor.”
Those who watch the WWE are his most important clients. The other companies will be back around.
Look Musk is breaking through to a new society. EV, Solar, Batteries, AI, and more…monetarily it is working. Some of these things are tied up in SM and not just the propaganda parts.
A SM is only worth something if it has over 50 million users. That is the critical mass. I think Truth Social does not have anywhere near that. Shows you how hard it is to start a new and successful SM. For Musk to buy that success puts him in a position to change X to his liking as things progress. I won’t guess how he changes things but there will be a major overhaul.
Musk could not find a less expensive way to get 50 million SM users.
