Is The Times Falling Behind The Times?

Investors just can't get enough of multimedia. Wall Street has bid up the shares of almost all media companies, figuring they'll offer much of the information that will give multimedia zing. Most publishers, meanwhile, are rushing to set up on-line services: In mid-November alone, Dow Jones & Co. and Washington Post Co. launched projects to develop interactive versions of The Wall Street Journal and The Washington Post.

Missing from the frenzy, however, is the New York Times Co. The publisher of the nation's most prestigious daily newspaper has been pouring huge bucks into traditional publishing, including a $1 billion merger in October with Affiliated Publications Inc., publisher of The Boston Globe. But it is stepping only gingerly toward the electronic age. The result: Times Co.'s shares lag those of its rivals (chart). "Instead of just standing there, [other publishers] are going after the market," gripes Goldman, Sachs & Co. media analyst Eric S. Philo. "The New York Times is just not doing it."

What gives? Times Co. President Lance R. Primis insists that "it's clear The New York Times is going to be a player" in multimedia one day, adding that some "great opportunities exist for a company that has as much original data as we do." But so far, Times Co.'s moves have been small. On Nov. 19, it announced an agreement with Nynex Corp. that will launch a daily fax delivery service of a customized assortment of stories to subscribers, and it recently launched FasTrack, a service that allows job seekers to register resumes with the Times and send them electronically to prospective employers.

One reason Times Co. may not be moving any faster is a deal the company struck a decade ago with Mead Data Central Inc.'s NEXIS data base. Under its terms, NEXIS holds exclusive on-line rights to New York Times stories 24 hours after publication, says Mead Data Marketing Director Deborah Silcox. That doesn't stop Times Co. from distributing its information electronically right after publication. But a day later, Mead Data holds further on-line distribution rights, barring Times Co. from signing up with other electronic distribution companies or offering a similar service.

Mead Data also has the unilateral right to renew the contract every year "in perpetuity," Silcox adds. Times Co. acknowledges the contract exists but won't discuss how it limits its expansion into multimedia.

Wall Street, meanwhile, wonders if Times Co. is simply overly preoccupied with problems in its publishing business. It suffered from a two-year delay in starting up a $450 million printing plant in Edison, N.J., as management wrested new labor agreements from unions. Then there was an expensive, doomed foray into Atlanta, where it bought the suburban Gwinnett Daily News and two small Georgia weeklies for $88.2 million in 1987, only to close the money-losing News last October and take a $53.8 million pretax charge. As a result, the company lost $44.7 million last year, on revenues of $1.8 billion.

ON-LINE CHATS. Will Times Co. suffer from not jumping into multimedia headfirst? Faster-moving rivals think it might. David D. Hiller, senior vice-president of development with Chicago-based Tribune Co., contends that knowledge gained in its numerous multimedia and interactive ventures is "critical" to his company's future. Adds Roger Fidler, interactive-media guru at Miami-based Knight-Ridder Inc.: "There's an advantage to being prepared and being out there first with some of these products."

Other publishers seem to agree. The planned interactive version of The Washington Post, scheduled to begin next July, will allow readers to place their own classified ads, "chat" electronically with other readers and Post editors, and call up detailed information on neighborhoods and entertainment. All this will be available on cable TV as well as by computer. Development of the interactive Wall Street Journal, which hasn't been announced, is just getting started. Staff members were assigned to the project in mid-November.

Primis insists Times Co.'s go-slow approach makes sense. "I'm not looking to pour a lot of money down a pit" by moving too quickly into multimedia, he says. Meanwhile, there are signs that older Times businesses are turning around a bit: Wheat, First Securities Inc. expects the company to turn an $81.4 million profit this year. But Times Co. must show more progress to quiet critics. With the multimedia age dawning, time's a-wasting.

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