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Business Analysis & Features

Gordon Bennett! What's Mark Thompson up to at The International Herald Tribune?

The former BBC director-general, now chief executive officer of the New York Times Company, is causing waves across the pond

What has Mark Thompson, the former director-general of the BBC, done to the famous Herald Tribune? Mr Thompson moved to New York late last year with a brief to extend his reputation as a manager of international media brands. As president and chief executive officer of The New York Times Company he is expected to do for the "Old Gray Lady" of publishing what he is perceived to have achieved at the BBC – namely, embracing digital media and positioning the organisation to face the world.

But less than five months into the role, Mr Thompson – rather than grow the business – has effectively killed off one famous global brand, The International Herald Tribune, and wants rid of another with a grand history and reputation, The Boston Globe. Both those news outlets have been closely associated with The New York Times and its commitment to journalism.

The "Trib" began life as the Paris Herald in 1887, founded as an organ for American ex-pats by the original Gordon Bennett, an eccentric Scottish-born New York publisher. The paper reached its pinnacle of chic in 1960 when Jean Seberg wore the distinctive "Herald Tribune" masthead on a tight, white T shirt when playing a newspaper vendor in the film "A Bout de Soufflé" (Breathless) and The New York Times took its first stake seven years later.

Mr Thompson announced this week that it was being rebranded as the International New York Times. At the same time, The Boston Globe, which is 142 years old and has been owned since 1993 by the New York Times Company, has been put up for sale. This is a streamlining operation.

"We want to face the whole world with one clear brand," Mr Thompson told staff this week. The Globe and its sister title, the Worcester Telegram & Gazette, "operate in very different markets from The New York Times".

When Mr Thompson, 55, was chosen for his new role last August, he was in a strong position; the world had admired the BBC's multi-platform coverage of the London 2012 Olympics.

After becoming director-general in 2004 he had led the BBC out of the trauma that followed the Hutton inquiry into its journalism, and built the organisation's large portfolio of digital channels and innovative features.

Across the Atlantic, where BBC America and the corporation's website have impressed audiences that have become open to foreign media, the influence of the BBC has been noted. As he looked for a replacement, chief executive, Arthur Sulzberger Jr, chairman of the New York Times Company, sought a figure who knew how to position a media organisation for maximum global impact.

He was convinced that the "gifted executive" was the right choice. The Briton, said a New York Times press release announcing the appointment, not only "reshaped the BBC to meet the challenge of the digital age" but also "oversaw a transformation of the BBC itself, driving productivity and efficiency through the introduction of new technologies and bold organisational redesign".

Some of those who have closely followed the recent history of the BBC may have raised half an eyebrow at those words. True, Lord Patten paid tribute to Mr Thompson as an "outstanding director-general" – but the BBC Trust chairman also hurried his departure.

And even before Mr Thompson could begin work in New York, the same BBC that Mr Sulzberger said had grown its "trusted brand identity" was having its reputation traduced. Not only was one of its most famous presenters being linked to serial sex abuse, but the BBC's journalists failed to broadcast their investigation into the scandal. This had largely happened on Mr Thompson's watch.

His pleas of ignorance did not impress all his waiting colleagues at The New York Times. Days ahead of Mr Thompson's arrival, columnist Joe Nocera warned the paper's readers of the "enormous sex abuse scandal" and delivered a damning verdict on his new boss: "Thompson winds up appearing wilfully ignorant, and it makes you wonder what kind of an organisation the BBC was when Thompson running it – and what kind of leader he was. It also makes you wonder what kind of chief executive he'd be at the Times."

The comments hinted at doubts that went beyond the Savile case to the fundamental differences between the BBC and The New York Times. Mr Nocera noted that Mr Thompson's task was to lead the publishing company – which like all newspaper businesses is struggling with the impact of the internet and has seen advertising revenues tumble (down 3.1 per cent on the previous year) – "to the promised land of healthy profits again".

But Mark Thompson's career has been devoted to public-service broadcasting. He joined the BBC as a trainee and rose through the ranks of its news division. For two years he was chief executive of a commercial business, Channel 4, during a period when it enjoyed the public gift of analogue spectrum and television advertising was plentiful. At the time, he famously accused the BBC of "basking in a jacuzzi of spare public cash".

As director-general he had the opportunity to put those same public resources to use, expanding the BBC website, launching the iPlayer, the Freesat platform and a host of new channels from BBC Three to the Asian Network.

Confidence grew at the organisation and Mr Thompson showed strong leadership skills in facing down challenges from Rupert Murdoch's News Corp, which complained the BBC had grown too big. But when it came to the tough financial negotiations with the Government over the future of the BBC licence fee, he could only strike a deal that left the organisation facing 2,000 job losses over the next five years – cuts that his successors have been left to implement.

In his new job he does not have licence-fee money to spend. Instead he will look to the company's subscribers, who were crucial to a last set of quarterly results that showed circulation contributing more to the bottom line than advertising for the first time in company history. Subscribers, said Mr Thompson, will be "our most important set of customers". The publisher is expected to move closer to the models used by subscription television services such as HBO and Netflix.

The New York Times Company once had a vast portfolio of assets, including television and radio stations, a newspaper empire stretching to Florida and Louisiana, the Boston Red Sox baseball franchise and (via Fenway Sports Group) a stake in Liverpool FC. Almost all have been sold. Losses from publishing have recently been offset by the sale of the jobs search engine Indeed.com and the online resource About.com.

Next under the hammer are The Boston Globe and the rest of the New England Media Group. Staff were assured they were not being sent to "the slaughterhouse", and Mr Thompson promised that the titles would have "strategic opportunities in new hands". A symbol of civic pride like the Globe, which cost the NYT $1.1bn in 1993 and is likely to fetch only $150m, will probably be rescued by wealthy Bostonians.

As Mr Thompson focuses on his core property, The New York Times, the great expansionist at the BBC still has his global media ambitions – only this time he has to find a way to pay for them.