The New York Post, Rupert Murdoch's American flagship until he was obliged to sell it in 1988, was within hours of closing down last week. It was saved by three things: the staff's agreement to a temporary 20 per cent pay cut; a 10 cent price increase (to 50 cents); and interim financing from Steven Hoffenberg, a businessman who has had problems with regulatory authorities.
The Daily News, the rival tabloid 'rescued' by Robert Maxwell in 1991, finally acquired a new owner last month in Mort Zuckerman, a property developer. Although he is full of optimism, the paper's circulation has sunk to 777,000 (a few years ago it was more than a million) and it probably needs the Post to fold to give it a realistic chance of making money.
Mr Zuckerman clearly had that in mind when he lured the Post's editor, managing editor and metropolitan (local news) editor to the News. Mr Hoffenberg, the Post's new owner, called him 'a vulture . . . trying to hire every reporter in town'. A few weeks ago Mr Zuckerman was said to have approached Martin Dunn, former editor of the Murdoch British tabloid Today, who instead accepted Mr Murdoch's offer of the editorship of the Boston Herald.
To a visitor from Britain, the New York press appears old-fashioned. Even the New York Times, the market leader selling 1,146,000 copies a day, looks 50 years out of date typographically. Despite the conservative bent of its readers, it is surely time for a change.
Of the four papers, only Newsday, the Long Island tabloid that began competing seriously in the city six years ago, can use colour on its front page. With a sale of 758,000, it is catching up with the Daily News, which needs new printing presses: on many days its inking is woefully indistinct.
But the Post, more than any of its rivals, seemed to have the kiss of death about it even before the triple defection. It can seldom run to more than 60 pages, compared with 100 or more for most issues of Newsday. On the day after its rescue was announced, it ran an 'exclusive' saying that Barbra Streisand was going to run for the US Senate. A good story - until it was comprehensively denied by Ms Streisand. Worse, in many editions, poor printing of the front- page picture resulted in a prominent smudge on her left cheek, as though she had been bitten there by a rabid reporter.
It is nearly 20 years since anyone made any money from the Post, which was founded by Alexander Hamilton in 1801 and boasts of being America's oldest continuously published daily paper. Dorothy Schiff, a New York socialite, owned it from 1939 to 1976, when it became a drain on her resources.
Rupert Murdoch bought it from her for dollars 31m (pounds 22m), and by 1983 had taken the circulation up to 962,000. But he did so by moving downmarket to a readership that advertisers were not interested in reaching: the more copies he sold, the more money he lost.
Forced to alter direction, the paper lost 300,000 in sales over the next four years, but was still making no money. In 1988, after buying a New York television station as part of his nascent Fox network, Mr Murdoch was forced to sell the Post because of cross-ownership rules. He received dollars 37.6m from Peter Kalikow, a property developer, but estimated that during his ownership he had lost dollars 150m.
Kalikow tried to halt the losses by turning it, like all its rivals, from an afternoon to a morning paper. The cost of distributing a newspaper in the crowded city in the afternoon had become prohibitive.
But the recession harmed both the paper and Kalikow's other businesses, until in 1991 he was forced to declare himself bankrupt. Last week's crisis came when the paper's bankers refused to extend it any more credit.
At the last moment it was rescued, at least temporarily, by Mr Hoffenberg, a businessman who had built up a financial empire by buying unpaid accounts - mainly from hospitals - at below their face value, and collecting payment of them in full. He promised not to interfere in the editorial process, but urged the paper to concentrate on 'less negative news'.
He had a personal interest in the matter, because reports in rival papers of his own background tended towards the negative. The New York Times reported coyly that his company's growth had been 'accompanied by some unusual accounting arrangements and an uneven compliance with its legal obligations to its investors'. It said that he had been barred from selling securities in his company in three states, and in four others could do so only with special permission.
Mr Hoffenberg has guaranteed the paper's losses for only four weeks, while the search for a long-term investor goes on. The quest will be made no easier by the loss of senior staff.
Owning a New York paper is a quick way to fame in the city but, as Mr Kalikow discovered, not necessarily to riches. If the supply of eligible millionaires is exhausted, New York's four papers will be down to three.
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