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Troubled Times Not Going Private

The New York Times Co. released its first quarter earnings. And it's not a pretty picture. The company is fast running out of cash. And given the severe decline in advertising revenue, an immediately turnaround appears unlikely.

Facing the shareholders this morning, NYT Co. Chairman Arthur (Pinch) Sulzberger Jr. made sure to trumpet the paper's five Pulitzers before being forced to answer a few difficult questions. He insisted that there are no plans to take the company private, but dodged inquiries about the fate of the Boston Globe, which could be on the chopping block.

Sulzberger did make it seem that it's all but inevitable that the Times will be installing a paywall for nytimes.com, the leading newspaper web site in the world:

As we chart our course toward a sustainable digital future, we have come to recognize with increasing clarity that online success will require substantial re-conceptualization, thoughtful execution, and a great willingness to take full advantage of the Web, an amazing laboratory for entrepreneurs, technologists and, of course, journalists.

As our history amply demonstrates, we are not adverse to change. ... Today, in the face of the economic downturn, we are renewing our analysis of how paid content can augment our core advertising business. The goal, of course, is to garner incremental revenue from the user without significantly cannibalizing our high rate ad pages.

Recently, we analyzed the business models of more than 30 different organizations to determine which are the most effective in generating revenues online. What we believe is that the advertising model we have used at NYTimes.com has generated more revenue than the vast majority of other organizations, including some that are much larger than our site.

That said, we continue to take a fresh, hard and deep look at various subscription, purchase and micropayment models. We will have more to say on this subject at a future date.

That future date will be sooner rather than later. According to the latest financial reports, the NYT is down to its last $294 million, with $260 already committed to pay off a debt due next March, leaving it with a scant $34 million in the bank.

Facing such a crunch, it's of little surprise that the NYT's charitable arm, the New York Times Company Foundation, is suspending all grant-making as of May 22.