The wealthy bankrollers of conservative causes could soon have a media arm to their name
Charles and David Koch, the billionaire brothers who have earned the enmity of the left for heavily funding conservative causes, could soon add a media franchise to their business empire.
According to The New York Times' Amy Chozick, Koch Industries is seeking to purchase the newspaper holdings of the troubled Tribune Company, which include The Los Angeles Times and Chicago Tribune. Moreover, the Kochs appear to be the early frontrunners to land the papers, leading critics and media watchers to ponder what impact such a sale could have on the papers' editorial content.
The Tribune Company, long mired in a financial morass, has publicly talked of selling its newspapers for some time. The Tribune Company owns eight papers with an estimated value of around $625 million, and has said it would prefer to sell them all as a package, rather than piece-by-piece.
That preference could tip the field in favor of Koch Industries, says Chozick, because they have expressed interest in buying all eight papers. Other potential suitors — including News Corp.'s Rupert Murdoch and a team of wealthy Los Angeles businessmen — are primarily interested in peeling off only The Los Angeles Times, the nation's fourth-largest newspaper.
That the Kochs, who have spent millions promoting Republican and Tea Party causes and candidates, may wind up with the Tribune papers raises the question of whether they're acting primarily for business reasons, or with an eye toward snagging a platform to promote their political beliefs. According to Mother Jones, the Kochs spent some $2.2 million on the last election cycle alone, either directly or through Americans for Prosperity, their political advocacy group.
One source who spoke with the Times said the Kochs, at a political strategy session a few years back, said they were very concerned with the question, "How do we make sure our voice is being heard?" Buying a media group would certainly achieve that end.
Politically, however, the papers could serve as a broader platform for the Kochs' laissez-faire ideas. The Los Angeles Times is the fourth-largest paper in the country, and The Tribune is No. 9, and others are in several battleground states, including two of the largest newspapers in Florida, The Orlando Sentinel and The Sun Sentinel in Fort Lauderdale. A deal could include Hoy, the second-largest Spanish-language daily newspaper, which speaks to the pivotal Hispanic demographic. [New York Times]As a whole, the newspaper industry is still bleeding money at an astounding rate. A Pew Research Center study released last year determined that print ad sales had declined by half since 2006. The Kochs, whose energy and manufacturing firm sees annual revenues of around $115 billion, are flush with cash, and they could stand to lose money on the papers should a deal go through. In December, the Tribune Company finally emerged from an embarrassing four-year bankruptcy case, which had been brought on in large part because the newspapers were losing so much money.
However, making money through the papers themselves may be secondary to another profit-based motive.
"They don't necessarily want to admit that while the papers themselves may lose money, they can be incredibly valuable to the corporate parent because they can deviously skew the news in a way that serves the larger company," says David Sirota in Salon. "In other words, newspapers can become a crucial part of a corporation's larger profit-generating political machinery by specifically manufacturing the Overton windows that determine the public policies on which the corporate parent relies."
Yet others see a less nefarious motive to the Kochs' interest. The Kochs are wildly successful businessmen, and they may be merely cashing in on an opportunity to squeeze the remaining dollars out of a shrinking industry, says Forbes' Tim Worstall, who argues that newspapers don't shape readers' opinion so much as they cater to it.
Proprietors do not mould the views of the readers. They chase them instead. Oh certainly, there have been plenty of people over the years who have attempted to direct the views of the readers: They're the ones who went bust though...
Yes, of course, there is a decided political slant to all newspapers. But this is determined by the pre-existing political views of the people the newspaper is trying to get to purchase the newspaper. [Forbes]Last month, LA Weekly reported that the Kochs were interested in the Tribune papers, though the article cautioned that the claim was based solely on unconfirmed rumors. Koch Industries refused to comment on the report at the time.
"As an entrepreneurial company with 60,000 employees around the world, we are constantly exploring profitable opportunities in many industries and sectors. So, it is natural that our name would come up in connection with this rumor," a spokesperson said.
The Tribune Company is expected to release more details about its finances to potential buyers in May. Once the relative health of the papers is more well known, the bidding war could intensify, and we'll get a better sense of where the Kochs stand.
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