We Won the Price War With Murdoch: Conrad Black

REPLAY VIDEO
Your next video will start in
Pause

Recommended Videos

  • Info

  • Comments

  • VIDEO TEXT

July 31 (Bloomberg) -- Former Newspaper Tycoon Conrad Black discusses the future of media with Erik Schatzker on Bloomberg Television's "Market Makers." (Source: Bloomberg)

Out on "market makers errico -- "market makers." many of the great newspaper titles are for sale or available at the right price.

Titles you know well, the "chicago tribune" and even possibly the "new york times" here in new york city.

Is there a scenario in which we might see you join the effort to buy one of these titles?

I don't know about the titles you particularly mention, but yes, i could see a possibility where it would be a buyers market.

The fact is there's a huge amount of goodwill in those huge newspaper titles and the goodwill can be exploited if it is approached in a different way.

We can't go on just converting trees to newsprint, printing among huge presses and delivering them at enormous expense all around the great cities of the world.

We have to make the internet transition and have a printed product for those who wanted.

That the burden of the printing is going to have to be carried in the homes of the subscribers if they want it printed, it will be printed in a home printer rather than a big printer on a colossal press.

What title might it be?

If you are asking me what i'm going to do, as a result of the persecution i endured at the hands of the justice department, i learned the lesson that i won't deal in public companies and i don't have to say anything to the public about what i'm doing.

I can't comment on that.

You mentioned various titles -- i'm not so sure about the "new york times" but some of the others are in play now and others will become so.

Whether i'm the person or somebody else's, there should be buyers for great trademarks like that.

In a market of infinite choice, a great, respected newspaper name, even if the medium itself is becoming obsolete, it's a powerful draw and worth a lot.

Warren buffett has been buying up a ton of small newspapers.

What do you think of his strategy?

Did you mention warren buffett?

Yes.

I would never criticize were in's strategy is a buyer.

His track record speaks for itself.

I think he is basically right.

He's buying in areas where the vulnerability to internet titration is not as severe as it is in the largest markets.

He's buying it a very low multiple of cash flow and i think he's saying these things could probably be adopted as needed and even if they can't, they could be stripped for profit, so there's no way he's going to lose.

I'm sure that is a correct analysis.

You've got your own personal reasons for not wanting to be involved in a public company, but at the same time, you know well how challenging it can be to balance the long-term needs of strategy, short term demand of company shareholders.

As a matter of principle, do you believe it's better for newspapers to be in private hands?

I think it's better for them to have controlling shareholders.

Otherwise they simply cannot resist the competitive pressures.

We won the price war in london with mr.

Murdoch even though he had the bigger company because we were prepared to cut price drastically and cut the prophet, protect the franchise, the dividend was not popular with shareholders, but when it came around, the cover prices came back up and we took the company private at a very handsome price.

But we could not have done it if we were dependent on the goodwill of the shareholders from quarter to quarter.

That is where the problem arose.

I didn't come on to talk about this, but i would remind your viewers that all of the counts against me were abandoned or rejected by jurors or vacated by the supreme court.

I won the greatest libel settlement in history of canada against the original allegations against me, which were false.

You have a perverse justice system and that did not spare me three relatively civilized and interesting years as a guest of the american people and one of your less commodious guesthouses.

Thank you for clearing that up grade back to newspapers and those that are for sale.

What about the idea of identity purchases?

Does that make sense?

People are just wanting the psychic income of the newspaper and then be prepared to take a loss?

I wouldn't bet too much on that.

You are getting into an area where many people are affected by vanity, but they have less self punitive ways of indulging it then throwing money out the window.

You just mentioned rupert murdoch.

You competed with him and told us about that back in the 1980s and 1990s in london.

You have seen what he has done with his media empire.

Also in australia grade -- also in australia.

You've seen what he has done with his media empire, spinning off publishing aspects from cable.

Is that a good idea in your mind?

I would be reluctant to criticize him on a thing like that.

He's built that up from a little provincial newspaper when he was in his early 20s to this colossal media giant.

I don't think i have any standing to take potshots at individuals.

Lex i'm not suggesting for a moment you take potshots.

For all i know you think it's a good idea and the assets he's assembled have nothing but upside.

I was not trying to bait you into criticizing rupert murdoch.

And i didn't suspect your motives, just wanted to explain.

I think it's very sensible.

He knows much better than i do the pressure he gets from shareholders and my impression was they were much more enthused about the other assets than the rent ones and were playing incidental and the still jet reasons, which are not the characteristics of rupert i best recognize having known him for 35 years.

But for those reasons he was hanging onto the newspaper business, i think he was probably a very efficient and fair way of getting investors their choice.

Those who wanted in that company are not satisfied.

I have a broad question about the industry and the turmoil it has been facing.

Clearly the technological shift we are experiencing to mobile and online is hurting newspapers.

Do you expect advertising will ever meaningfully come back to the newspaper industry?

Not exactly come back, but i think what you can do is bank on this -- especially in north america -- anyone who buys newspapers, it's a high income, higher education reader.

That somebody they want.

Secondly, people do relatively speaking read the ads in newspapers.

Third, there will always be some people who wanted printed and forth, you've been tied into other forms of advertising.

Because the editorial function is going to become so tremendously emphasized, even those of us who had nothing else to do but watch all day as vigilantly and voraciously as possible to see the news would not get everything we wanted.

Editors are more important than ever and the digest of these things is important.

I think there's a place for raising the cover price for producing a better product and even a designer product for certain types of the scriber's. i think there is a role for it it's a niche of the market for a market that was once entirely the newspaper market.

It is still a profitable business.

We want to talk to you about

This text has been automatically generated. It may not be 100% accurate.

Advertisement

BTV Channel Finder

Channel_finder_loader

ZIP is required for U.S. locations

Bloomberg Television in   change