BOSTON, May 7 – The New York Times Co. on Wednesday lifted — at least for now — the ax hanging over the Boston Globe after reaching agreement on deep wage and benefit cuts with the largest union at the newspaper.
The New York Times Co., which purchased the Globe for 1.1 billion dollars in 1993, had threatened to close the 137-year-old Massachusetts daily unless it wrested 20 million dollars in concessions from its unions.
The Times Co. reached agreement with six of the Globe\’s seven unions on Monday but had failed to hammer out a deal with the largest one, the Boston Newspaper Guild, which represents 600 editorial, advertising, and business office workers.
But management reached a tentative agreement with the Guild overnight in marathon talks which ended at 3:00 am.
The Globe, citing "sources familiar with the deal," said the agreement called for a substantial pay cut, unpaid furloughs, and modifications to lifetime job guarantee provisions that protect nearly 200 Guild employees.
"These negotiations have concluded and we have a proposal to bring before the members of the Boston Newspaper Guild," the paper quoted Guild president Daniel Totten as saying.
The Times Co. now has the 20 million dollars in concessions it was seeking, the Globe said.
Like other US newspapers, the Globe has been grappling with a steep drop in print advertising revenue, steadily declining circulation and the migration of readers to free news online.
With the newspaper industry in crisis, a Senate subcommittee was scheduled to hear testimony on "The Future of Journalism" on Wednesday from a panel of prominent Internet and newspaper figures.
The Globe is forecast to lose 85 million dollars this year, according to the Times Co., which has been struggling with escalating losses of its own and a heavy debt burden.
John Farrell, a 45-year-old computer researcher from nearby Watertown, welcomed the news that the Globe had been saved.
"Although I\’m online constantly, I still enjoy relaxing on Sunday with the Boston Globe," he told AFP. "That\’s been my routine for years.
"I\’m happy to know the Globe will continue. If we lost it, it\’d be like taking away the Red Sox," he said in a reference to Boston\’s beloved Major League Baseball team.
The agreement came a day after the New York Times announced it would raise prices from June 1 for the daily and Sunday editions of the newspaper, whose parent company, the Times Co., lost 74.5 million dollars in the first quarter of this year on a 30-percent drop in advertising revenue.
The Times Co. also unveiled plans on Wednesday to make Amazon\’s new Kindle electronic reader, the Kindle DX, available at a reduced price later this year to readers of the Times and the Globe.
The Kindle DX, which costs 489 dollars, would be available to readers "who live in areas where home-delivery is not available and who sign up for a long-term subscription to the Kindle edition of the newspapers," Amazon said.
The Times Co. recently completed a sale-leaseback deal for part of its Manhattan headquarters in a move aimed at raising cash to pay down its debt and received a 250-million-dollar loan from Mexican billionaire Carlos Slim.
The Times is also seeking a buyer for its 17.75 percent stake in New England Sports Ventures, which includes the Boston Red Sox and their iconic stadium, Fenway Park.
With a weekday circulation of more than 320,000, the Boston Globe is the 14th largest newspaper in the United States. It began publishing in 1872.