Tony Heller at RealScience has another good article: Today’s Featured Climate Criminals – The Guardian. Reading the comment by Gail Combs: “Of course they are also losing paying customers by the droves” backed up with this link: Guardian CEO: my newspaper can’t survive in the UK (Ain’t Karma wonderful.)“, I wondered when we would finally see the demise of this insufferable paper.
Unfortunately, it doesn’t seem anywhere near soon enough – and guess why!!! they made huge amounts of money from their automobile business!!
Talk of hypocrisy! They are telling other people to divest from “fossil fuels”. But that’s easy to say when you are living off the back of fossil fuel earnings as they are. If they had any integrity they would donate every single penny they made from Autotrader to the poor in the third world who suffered from their non-science such as those who suffered from rising food prices during the bio-fuel scam.
But it appears the Guardian are devoid of morals. Here is the piece from the former Guardian sportswriter explaining why the Guardian can keep pushing the evils of car use for so long … because of their automobile business:
Having a trust that protects you from shareholders only really helps if the Trust has piles of cash. The Scott Trust, thanks to some brilliant decision making by Guardian advertising and management teams in the late 70s, has had a lot of cash for the past 30 years or so and will have cash for the next 10 at least.
The brilliance? Spotting the very early potential of John Madejski’s regional car classified magazine business model and cutting a deal to carve up the country’s ad markets and work together to build Autotrader. Fast forward and in good years AutoTrader threw off $100 million in cash to keep the rest of Guardian Media Group going.
So, (one of the great ironies of British leftism/liberalism), while the secondhand car classified market was healthy and lucrative, the Guardian was safe.
What Autotrader did better than the Guardian was transition to economic dominance of their digital marketplace, which, while less lucrative than in the glory days of print, was nonetheless healthily profitable for them.
In the mean time the Guardian was profligate in spending vast amounts of money on an attempt to establish itself as a dominant global liberal digital voice and saw a pre-eminent position in recruitment classified advertising disappear in very short shrift for political and technological reasons, while also investing huge amounts of money on a print plant even as their editor was proclaiming the death of print.
The Guardian recently cashed in its shares in Autotrader at what seems like a very good price. The strategy appears to run the newspaper group more like an endowed US college, with GMG needing to more or less breakeven with ample capital and future interest from the Autotrader windfall giving the company the cushion to tough out years when the Guardian loses a lot of cash and brings down the rest of the mildly profitable business. As long as no big risks are taken this strategy ought to work well over the long term.
So I don’t think the Guardian goes bankrupt in the next 10 years. The answer to when it will is then much the same as the answer for any other business. It goes bankrupt when it runs out of cash. A normal business would be pretty secure sitting on $500m of cash and no shareholders. The Guardian newspaper’s ability to lose huge amounts of money as it transitions away from print make it slightly less certain, but it would require 10 years of unadulterated profligacy (entirely within the Guardian’s capacity) with no action taken by GMG to slow down those losses (less likely) for it to be bankrupt in any kind of predictable timeframe.
In the long term it really depends on whether the Guardian can find its feet as a powerhouse of commercially viable mainstream innovation again. I’d give it a good shot at that. The world looks bleak right now for an old-school news org (even one that talks a great digital game), and a lot of mistakes have been made. Yes, it has struggled to reinvent itself outside the old model of news delivery and advertising distribution. But it still attracts some of the brightest, most talented people from a city with a pool of bright talented people from all over Europe, who will eventually not be subject to the priorities, expectations and perspectives of the generation tasked with the painful transition from print. That could be an exciting thing to be part of.