With the success of the pay wall in the summer of 2011, it seemed the paper was turning a corner—which made what came afterward even worse. Between the About.com debacle and the sudden decline in print advertising, the paper was headed toward a 3 percent drop in revenue and an overall loss of almost $40 million in 2011. Since Robinson began as CEO in December 2004, the Times stock has lost more than 80 percent of its value. And this was significant not only for the business but also for the family that owns it. The Times has always had conflicting business prerogatives: to turn a profit, yes, but also to supply the family with what amounted to a trust fund by churning out several million dollars a year in stock dividends. At one time, the family received upward of $20 million a year, which served as a kind of Ochs-Sulzberger operating budget. But when the dividend was suspended, the family were left with only their stock wealth and whatever they had in trust funds and savings. That was fine for Sulzberger and the five other family members with salaried positions at the company, but the wider family of sons and daughters, nieces and nephews were now forced to sell stock at a historical low to raise money. Most of them have admirable if low-wage jobs as academics, novelists, musicians, and psychotherapists, but the money also funded second homes and hobbies such as underwater exploration. Two years ago, the clan began working with a company called Relative Solutions, which specializes in brokering disputes inside wealthy families. The latest proxy statement by the company shows that the Ochs-Sulzberger-family holdings have been reduced to 15 percent of Times stock, down from 18 percent last year.
To turn the financial corner, the Times has been off-loading struggling properties from its portfolio to raise cash, bailing on its investment in the Boston Red Sox and selling its group of regional newspapers, which the Times wrote down as a $161 million loss in 2011. Three years ago, the Times tried selling Boston Globe, its sister paper, but was unable to find a deal. Last year, the company began debating whether to try again.
This matter, it turns out, was the hinge point at which the Times’ business failures, the family tension over the dividend, and the Nisenholtz and Gonzalez affairs would all conspire to isolate Sulzberger and force Robinson out. In the past, Robinson had resisted selling the Globe. She wanted to wait until the Globe’s new pay wall, which launched last fall, took effect and possibly improved the paper’s sale value. “Janet was the leader of the group that didn’t want to sell it, and because she was boss, her voice carried,” says a person familiar with the situation.
But there was another significant voice rising in the debate—that of Michael Golden, Arthur Sulzberger’s first cousin. As the second-most-powerful family member at the Times Company, Golden had run just about every division except for the Times itself, from the women’s magazines it used to own to the Paris-based International Herald Tribune—and, most recently, its regional media group. An affable man with curly hair and a trace of southern drawl from his years growing up in Chattanooga, Tennessee (where his mother published the Chattanooga Times), Golden was much more accessible to Times executives and other family members than Sulzberger. A large shareholder of the Times Company’s class-B stock, he served as a counterweight to his cousin, an interlocutor between Sulzberger and the rest of the family, who, except for two other members who sit on the board of directors, have no say in business matters. “His unspoken job is family relations,” says a person who knows him.
Golden, though well liked, also suffered from the perception that he was a dilettante with a weak business mind. He could get overly obsessed with details, say people who have worked with him, and miss the larger point. While overseeing the construction of the Times headquarters, he forgot to include the cost of paying off the debt in a budget he submitted and caused some embarrassment.
Nonetheless, he had never resigned himself to playing second banana to Sulzberger, and he chafed, as others did, at Robinson’s authority. “He has always been looking for a bigger role and always felt subordinate to Arthur,” the source says, “and thought Janet had too much influence with Arthur.”
For her part, Robinson saw it as part of her management job to keep Golden safely at bay while she took care of the details for Sulzberger. She was, after all, his virtual left arm, and Sulzberger enabled her, according to a person who witnessed it, by openly dismissing Golden in conversation with colleagues.