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Newsonomics: Will Michael Ferro double down on newspapers or go digital?
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Nov. 27, 2017, 3:09 p.m.
Business Models
LINK: www.wsj.com  ➚   |   Posted by: Ricardo Bilton   |   November 27, 2017

The speculation is over: Time Inc. has officially found a buyer. Meredith, the publisher of magazines including Better Homes and Gardens and Family Circle, shelled out $2.8 billion for Time in a deal announced Sunday night.

But with the end of that speculation comes some new questions about the potential involvement of Charles and David Koch, who contributed $650 million into the merged company. The general concern among observers is that the two billionaires, who have founded and funded organizations like the Heritage Foundation and the Cato Institute, will use the newly owned Time Inc. properties to help push their conservative agenda. But the Koch brothers said they no intention of meddling with the merged company, whose board they won’t take a seat on. “[Koch Equity Development’s] non-controlling, preferred equity investment underscores a strong belief in Meredith’s strength as a business operator, its strategies, and its ability to unlock significant value from the Time Inc. acquisition,” they said in a press release.

While it’s possible that the Koch brothers saw the Time Inc. deal as just another good investment, it’s hard to believe that they would chip in for a fifth of the company and not expect some degree of editorial control over the operation. (It’s also worth pointing out, as many have, that Rupert Murdoch also promised not to meddle in the editorial matters of the Wall Street Journal when he bought the newspaper in 2007.)

Overall, billionaires have had a mixed track record when it comes to their involvement in media companies over the past few years. On one hand you have Jeff Bezos, whose active role in strategy at The Washington Post has changed the newspaper for the better. On the other hand, there’s Joe Ricketts, whose personal animosity towards unions pushed him to shut down Gothamist and DNAinfo last month. Where the Koch brothers fit on that continuum is still TBD.

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