Boston Globe on the brink of closure

May 4th, 2009 - 9:41 pm ICT by IANS  

By Arun Kumar
Washington, May 4 (IANS) Boston Globe could cease to exist within weeks with its owners the New York Times Co. threatening to close the American newspaper unless the unions agreed to $20 million in cuts, media reports said.

After down-to-the-wire negotiations did not result in union concessions, the Times Co. said that it will file Monday a required 60-day notice of the planned shutdown under the Worker Adjustment and Retraining Notification law, the Washington Post reported.

The company and union had set a deadline of midnight Sunday to forge an agreement. But negotiations continued until 8 a.m. without a resolution, a news agency report said, and both sides agreed to return to the table within a day or two.

The threatened shutdown could amount to a negotiating ploy to extract further concessions from the Globe’s unions, since the notice does not require the Times Co. to close the paper after 60 days, the Post said.

But it puts the unions under fierce pressure to produce additional savings; the Boston Newspaper Guild promptly called the step a “bullying” tactic by the company.

The Post cited some industry observers as expressing scepticism that Times Co. Chairman Arthur Sulzberger Jr. would want his legacy to include the shuttering of the Globe, which his company bought in 1993.

But the Times Co. itself is under strong financial pressure.

It recently mortgaged its new Manhattan headquarters, borrowed $250 million from a Mexican billionaire at 14 percent interest, laid off 100 newsroom staffers and cut salaries by 5 percent.

Globe management said in a toughly worded statement: “Filing the WARN notice is a difficult step that we would like to avoid. But, unfortunately, given the state of the negotiations, it is one we must be prepared to take.”

The paper’s circulation dropped 14 percent in the most recent six-month period. The Globe is expected to lose $85 million this year, the company says.

A Globe shutdown would leave the city with only one daily newspaper, the tabloid Boston Herald, which has just 10 news reporters and is battling its own financial difficulties.

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