The Observer was designed in 1987 to look as if it had been around forever, a charming, unchanging, sui generis New York institution. And the paper has become more or less that: a single editor-in-chief for the last twelve years, the only redesigns mere tweakings, circulation always around 50,000, budgets achingly small, profits nonexistent, and always maybe kinda sorta for sale.
According to Peter Kaplan, the Observer ’s editor, “Arthur’s called with buyers 20 or 30 times.” He means Arthur Carter, who founded the Observer after making his fortune on Wall Street. But apparently only once, in 1999, was a deal anywhere close to consummated—with Conrad Black, before he became an indicted corporate kleptocrat. “Conrad was a half-hour away from happening. Releases went out—and Arthur turned” with “incredible prescience” and called it off.
But now Carter really and truly has put the paper on the block. A sale, it seems, is imminent. Because he is almost 75? Maybe, but there is also a curious clockwork symmetry to the arc of his media mini-moguldom. In a dozen years during the eighties and early nineties, he became the owner of several twee weeklies, launching the Litchfield County Times and the Observer , buying The Nation and half the East Hampton Star. And then, during the last dozen years, he has deaccessioned each after owning it for exactly one or two decades. The Observer ’s 2007 sell-by date is approaching.
One well-known investor-macher was interested enough to take three meetings—before admitting he just didn’t have the stomach to piss off his friends, whom the paper covers. Mort Zuckerman talked about turning the paper into a Wednesday supplement to the Daily News—a way, finally, to make his friends look at his paper at least once a week. The owners of New York looked and passed. Someone representing Ron Burkle called. And during the last month, the news that Robert De Niro and his partners are among the prospective buyers has given the paper a spike of Nobu-esque heat, enticing still more rich, glamourtropic would-be publishers to take a look.
But it is the Tribecans—De Niro; his producer and impresaria, Jane Rosenthal; and her real-estate-investor husband and Film Festival partner, Craig Hatkoff—with whom everyone at the Observer is dying to be in business. Due diligence was in progress last week. Fingers were crossed. “This is it,” says Peter, with whom I have been friendly since college. “Arthur is jazzed. He wants it. He loves these people. Everyone else has only represented money. Arthur was emotionally never ready to release it until he ran into these people.”
“Ran into” them in Observer ishly, cozy-Manhattan-power-broker fashion: Rosenthal, an NYU alumna, and Hatkoff are active board members of NYU’s Child Study Center, where Carter’s wife, Linda, is an associate professor of psychiatry, and Carter is on NYU’s board.“Arthur,” Peter continues, “thinks they’re kindred spirits, that Craig and Jane embody his two sides, the hard business and the creative. They’re very romantic about New York. And the fact that they’re amateurs is a total gift.”He means publishing amateurs, as well as amateurs in the good old-fashioned sense—people who throw themselves into a thing for the fun of it whether or not it makes strict financial sense. Not that these are goo-gooey naïfs. They have been successful in shark-infested businesses. De Niro obviously has plenty of dough, and the Rosenthal-Hatkoffs are worth tens of millions, but if the Observer deal closes, instead of paying much cash up front, Tribeca would agree to cover the paper’s losses going forward—and to keep Arthur Carter involved.
If the deal doesn’t happen, there’s apparently at least one fallback buyer, a well-known local billionaire ready to write a big check. Not to be a buzzkill, but mightn’t the Observer also go the way of other much-loved, undercapitalized New York weeklies, such as the Soho Weekly News and 7 Days? “Arthur won’t pull the plug,” Peter insists. “He’s now very jolly. He’s feeling very good about the world.”
Peter Kaplan’s vision of the city is determinedly black-and-white, a mashup of His Girl Friday, The Big Clock, and March of Time newsreels, with a soundtrack sampled from George Gershwin, Raymond Scott, and Bernard Herrmann. He wears a tie every day, but always loose, with his collar unbuttoned, and a trench coat more often than anyone I know.
The Observer , he says, sounding as always a little pleased to be beleaguered, like Jimmy Stewart on the subject of Bedford Falls, “is a sweaty, grungy little newspaper at a very difficult time for newspapers. We’re a throwback to what newspapers were before objectivity became a mask.”
That’s true. But paradoxically, the paper’s smart-alecky tone and approach are, if you will, a throwback to the future: Typographically, the paper may recall what Pulitzer did in the twenties, but in its opinionated reporting and nonstop attitudinizing the Observer is also modern and bloggy, like the Huffington Post or Slate.
Peter bridles a bit at the 21st-century linkage, however. He’s publishing more and more on the Web—he understands it’s the future—but that doesn’t mean he’s platform-agnostic. “Metaphysically, a newspaper is something you hold in your hand and doesn’t vanish—I hate to get too marijuana-like about it, but print is not the Cheshire cat. The power of physical publication is immense.”
The Observer is defined by its subject—“the power elite,” says the editor—and its smart, knowing, wry, sometimes snotty cosmopolite’s take. Yet for its first several years, it was just about the opposite—dorky, earnest, clueless, entirely unhip, a thing today’s Observer would sneer at. And something which Spy, back then, did. Such perfect irony, therefore, that it was a tag team of my fellow Spy editors—Graydon Carter for a year, then Susan Morrison for two years—who decamped to run the Observer and invent its smart-set sensibility.
I buy the paper without fail, and not only because it covers the worlds I inhabit as minutely as a trade publication. Sure, its relentless hothouse humidity and high-school-with-money smugness can be enervating—just like New York itself. But the paper manages always to have a handful of quirky, excellent writers and reporters.
So many paradoxes: annoying but irresistible, old-fashioned but newfangled, cheap but posh—and Establishment but anti-Establishment, “the insider’s underground newspaper,” as the paper once billed itself. Another paradox is the asymmetry between its size and its visibility: The Observer has a disproportionate importance because its subjects and wannabe subjects are its readers, all of whom have a disproportionate sense of their own importance.
Thus the apparent eagerness of certain plutocrats to publish a paper that ranks in circulation somewhere between the alternative weeklies of Milwaukee and Boise, and loses more than $2 million a year. Fine! Choosing not to maximize profits in order to enliven the culture, another un-American paradox, is grand—partly vanity, of course, but so is straight philanthropy.
Arthur Carter, who donated $11 million to NYU in the 2004–5 school year, is pretty paradoxical himself. Peter finds his eccentricities sweet; his two previous editors, not so much. Carter is, on the one hand, very fancy: He has a degree in French literature from Brown, and once in a conversation with me about business he quoted Pierre Bourdieu to the effect that status, not money, was life’s animating force. But his accent and vocabulary remind me of my plumber in Brooklyn. “I hope it has a simplistic elegance to it,” he once told me about the minimalist steel sculptures he makes and shows.
And while he has poured many, many millions into the Observer with almost no hope of recouping, he’s also published it on the cheap. There are strict limits to his quasi-charitable irrationality. Even today, he’s still spending—last week I got a piece of Observer junk mail—but he also just shrank the paper to one measly section.
They do an amazing job given the tiny staff (25 or so), but the perpetually tight budgets and Carter’s own geographic and demographic parochialism have probably made the Observer an underachiever, editorially and maybe even financially. “None of my friends read the paper,” says one of its young reporters, “except media people and Upper East Siders.” Only in the last few months, for instance, has bobo Brooklyn become a regular beat, about a decade late.
If the new owners are willing to underwrite somewhat bigger losses in the near term, the editor would undertake “more Wall Street coverage. We’ve never really covered theater or Seventh Avenue. And obviously Hollywood.” Any new owner should bring Observer .com up to snuff. Of the six blogs, only a few have fresh posts every day.
But can the paper ever be a real business? It makes around $1.5 million a year in subscription revenue, and more than that from advertising. What’s required, Peter thinks, is a more serious ad-sales operation, as well as, yes, more Web-dedicated journalists. “We are a brand name for a kind of high-end New York. We ought to be raking it in.”
True-believing wishfulness, maybe. But while the Observer is small, its demographics are impressive—similar to the Times’s, but younger, more highly educated, and more affluent. When I told Peter I’d heard a rumor that the Times might be a buyer, I knocked the wind out of him. “Maybe the two Arthurs”—Carter and Arthur Sulzberger Jr.—“have talked.” He paused. “That would be the end of everything. So much of why the Observer is here is to tell New Yorkers that the benign dominance of the Times is a sort of tyranny. It’s as important to us as covering the State Department is to them.”
So here’s hoping that De Niro and his savvy, cool friends make the deal, and devise the commercial means not only to keep the paper going but to nudge it from good to great. I asked Peter if the budget pinch is the only thing that’s ever made him think seriously about leaving.
“Yeah.” And: “I’ve always thought of the paper as being a big nineteenth-century novel about New York.”
So does he want to retire as editor of the New York Observer ? He’s 52.
“Yeah. The weekly paper is still the thing I love doing. I am,” he says with a smile, about to compare himself to the shambling, lovable, romantic hero of a small 1934 novel about England, “the Jewish Mr. Chips. It’s my life’s work.”
Correction: This story has been corrected from its print version to reflect Peter Kaplan’s accurate age, 52.