Towel Talk: Employees weigh slash vs. trash

Posted Jun 21st 2007 8:30AM by Peter Cohan
Filed under: Deals, From the Boards, Competitive Strategy, General Electric (GE), Marketing and Advertising, Columns, News Corp'B' (NWS), Dow Jones and Co (DJ)

Dow Jones & Company's (NYSE: DJ) Wall Street Journal (a.k.a., The Towel) occupies a unique spot in the media firmament. As I pointed out earlier in the year, it changed its format and now looks to me like a Holiday Inn bath towel. Towel Talk offers a perspective on its news and views.

The New York Times [registration required] reports that Towel employees view the options for their new management as a choice between "slash" and "trash." By slash, they refer to the cost cutting of General Electric Co. (NYSE: GE) -- which may make participate in a bid for The Towel; whereas trash is their moniker for tabloid tyrant Rupert Murdoch.

Meanwhile there have been two interesting developments. Yesterday, The Towel's board decided it was time to grab decision-making power from the Bancroft family -- concluding that they were taking too long to make up their minds. And Brad Greenspan, the former head of MySpace parent, Intermix Media, is making a tender offer for 25% of The Towel at $60 a share -- the same price that Murdoch, who bought MySpace over Greenspan's objections, has offered.

Could Greenspan's offer be motivated by revenge for Murdoch's "stealing" MySpace for $580 million? Will GE actually put an offer on the table? What about Run Burkle's "offer'?

I don't know -- but I think this media soap opera has gone on long enough. And with The Towel's board taking over the process, it might speed up a bit. However, it will be interesting to see what happens if the Bancrofts and the board end up disagreeing on what to do.

Peter Cohan is president of Peter S. Cohan & Associates, a management consulting and venture capital firm. He also teaches management at Babson College and edits The Cohan Letter. He owns shares of GE, has consulted to News Corp's CEO and has no financial interest in the other securities mentioned in this post.

Tags: bancroft family, BancroftFamily, bancrofts, dj, ge, nbc, ron burkle, RonBurkle, wall street journal, WallStreetJournal