If the P-I is to survive as a news paper, it would seem to require a charitable and innovative billionaire. We happen to have some of those handy. And Bill Gates would seem the more likely of the two.
Paul Allen has been an old-school newspaper investor - having bought the Sporting News for $100 million in 2000. Unfortunately, the tab began fading in his hands, and he sold it for about half the purchase price six years later. He is not a lucky investor, despite his wealth; his cable TV company, for one, has lost $7 billion and is near bankruptcy. Allen himself has lost about half of his once-$30 billion worth, Forbes says.
Of couse, that might make Allen a natural to invest in the
dinosaur newspaper business. But, even if the loss of his hometown
paper tugs at his heartstrings, he's not interested in the P-I,
according to an attorney seeking to keep the paper alive. "I called his
organization the moment I heard [of the P-I's sale]," says the attorney.
"They said it's 'not within our scope.'" (When I asked, Allen's
corporation had no comment).
On the other hand, Allen's Microsoft co-founder Gates, personally and
through his foundation, has seen merit in today's new and old
news-delivery systems. The foundation is even tied in with the P-I's
owner, Hearst, in a SF Bay Area dinosaur newspaper deal.
The Bill & Medlina Gates Foundation along with other investors loaned MediaNews Group $350 million in 2006 to buy four newspapers, including the San Jose Mercury News and Contra Costa Times, from McClatchy (MediaNews' total line of credit from the deal is closer to $600 million).
In turn, Hearst bought two other McClatchy papers in California and
Minnesota, then handed them over to MediaNews for a stake in MediaNews
operations outside the Bay Area.
The $30-plus billion Gates Foundation
had no comment and referred me to Gates' personal and foundation
investment guru, Michael Larson of Cascade Investments LLC, who handled
the MediaNews deal - he didn't call back.
But the foundation does invest in journalism. Among its
recent grants (as opposed to its investment side) was $3.5 million in
December to establish a TV production unit to report on global health
issues for PBS' The NewsHour with Jim Lehrer.
Earlier, it gave $16 million to other media operations and journalism
schools, mostly to finance better global-health reporting. Gates and
his foundation also invest in new media, of course - most recently in
online company PlanetOut and a new English-language broadcast service
by NHK of Japan.
Still, any investment in the P-I would be done more with the heart than
the head, concedes the Seattle attorney seeking a buyer for the P-I.
"It's going to take a White Knight," the attorney says. "And so far I
haven't heard of anyone willing to step forward."
Update: For the record, P-I managing editor David McCumber has in fact met with Bill Gates Sr., co-chair of the Gates Foundation, but we've confirmed it was for advice on who McCumber might try to tap as potential buyers, not a bid to get the foundation to step in. McCumber has been beating the bushes for a buyer almost since day one.