Obituary: Theodore Newhouse

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THEODORE NEWHOUSE, who with his two brothers assembled one of America's biggest communications conglomerates, began a lifelong career in publishing as a manager of a family-owned newspaper, The Long Island Press. By the time he retired some seven decades later, the family holdings included 26 newspapers; Conde Nast Publications, which publishes The New Yorker, Vogue and Vanity Fair; substantial interests in cable television; and Random House publishers.

Newhouse was one of eight children from a family of poor Jewish immigrants who came to the United States at the turn of the century: his father was Russian; his mother Austrian. As a child in Bayonne, New Jersey, he helped the family by selling newspapers and scrounging for firewood.

His eldest brother, Samuel I. Newhouse, got the family into the publishing business when a local lawyer-businessman gave him a try-out at no wages. In 1911, at the age of 16, Sam was put in charge of The Staten Island Advance, a newspaper that the lawyer had taken over in satisfaction of a bad debt. Sam made the paper a success and acquired it himself in 1922.

Theodore Newhouse, then 19, was brought in to help out and get what he would later call "on-the-job training", which included duties as the paper's music critic and overseeing the publication's classified advertisements. A third brother, Norman, was also recruited, and moonlighted as a reporter. Together, the brothers established a management style that came to characterise the Newhouse empire - frugal, secretive, and controlled only by members of the family. Nor were they sentimental - when The Staten Island Advance became unprofitable a few years ago, it was quickly shut down.

The brothers embarked on a policy of newspaper acquisitions, amassing the fourth largest newspaper empire in the United States, that includes the Newark Star-Ledger, the Cleveland Plain Dealer, the Portland Oregonian and the New Orleans Times- Picayune.

In 1932, Newhouse became general manager of a new acquisition, The Long Island Press, and soon after became the associate publisher of all the Newhouse newspaper holdings, an involvement he sustained until 12 years ago when his health began to fail.

Newhouse moved into a nursing home and the company is now divided into two parts, the glossy magazine holdings run by Sam Newhouse's son S.I. "Si" Newhouse and the more profitable newspaper and television holdings by Si's brother, Donald.

The founding Newhouse brothers established both a punishing work ethic (at work before dawn) and an abstemious life style (they used public transport); however, they also devised a series of tax feints and dodges to keep the revenue services perplexed. After Sam Newhouse's death in 1979, his heirs, Si and Don, filed a return the following year declaring the taxable estate to be $91m, on which $49m tax was owed. The IRS determined it worth $962m and the tax $658m, the biggest tax bill in history. Moreover, the IRS charged that the original return was so far off base as to constitute fraud and imposed a 50 per cent penalty of $305m on top. A jury found in favour of the family.

Throughout his life, Theodore Newhouse maintained a strong interest in the arts. While he was working at the family's first newspapers, he took night classes at several New York City universities in opera, music and art, and studied dance in the summers. In later life, he made donations to a wide variety of cultural groups, including the New York City Opera.

Theodore Newhouse never lost sight of the fact that it was his elder brother who got the empire started. In the mid-1970s, the family gathered at his summer home in Connecticut to celebrate his 20th wedding anniversary. As the lunch progressed, Theodore rose to give the first toast and heads turned expectantly towards his wife, Caroline. But Theodore raised his glass and said simply, "To Sam".

Theodore Newhouse, publisher: born Bayonne, New Jersey 19 July 1903; twice married (one daughter deceased); died New York 28 November 1998.