New York Times gives dissidents 2 seats: Big deal!

The New York Times Co. (NYSE: NYT) has agreed to give activist hedge funds Harbinger Capital Partners and Firebrand Partners control of seats on its board of directors. The funds own a 19% stake in the company, but that really doesn't matter. The New York Times Co. has a dual-class voting structure, so the Sulzberger family controls 10 directors while the outside shareholders elect 5. So Harbinger and Firebrand control 2 out of 15 directors and the maximum any shareholder could ever dream of electing is 5 out of 15 directors.

In a display of journalistic integrity, the New York Times itself admitted that this move is pretty much irrelevant, saying that "The new arrangement could make for some uncomfortable internal politics, but it is not clear that it will have any effect on the company's direction."

The company says, of course, that it looks forward to working with the new directors, who have pushed for asset sales and more aggressive investment in the internet.

But the problem is that having 2 seats on a 15-member board won't provide any additional leverage, as far as I can tell.

This quixotic activist campaign, however noble, is likely to result in a big fat nothing.