Red Ink for Yellow Journalism
Emails from American Media Inc. officials apparently threatening Amazon founder Jeff Bezos with extortion and blackmail have put AMI and its chief executive, David Pecker, in potential hot water with federal prosecutors as well as the AMI board. Threatening the richest man in the world — in writing — may not have been the smartest move, but AMI was already in dire straits, Bloomberg reported Tuesday: Years of "steep financial losses" have left "the once-loyal keeper of Donald Trump's secrets with more than $1 billion in debt and a negative net worth."
Over the past few years, a "borrowing binge" by AMI has "swelled its debt load to more than $1.3 billion," Bloomberg said. Investment firm Chatham Asset Management owns an 80 percent stake in AMI, thanks to a financial lifeline thrown to Pecker in 2014, and despite efforts to butter up Saudi Arabia's leaders, "there is no direct investment in the company's debt or equity by the Saudis," AMI Chief Financial Officer Chris Polimeni said, adding that AMI's financial picture is improving.
In some ways, the National Enquirer simply ran into the same market forces that have buffeted all print media, Joe Pompeo says at Vanity Fair. "Circulation was on the decline — it is now reportedly south of 300,000, down from a peak of around 6 million a week in the late 1970s — and AMI was running into financing troubles that it continues to grapple with today." But the whole Bezos affair "has stunned battle-hardened tabloid veterans who thought they'd seen it all," Pompeo adds, making them wonder why AMI was so desperate to get Bezos to publicly state hacking his texts wasn't tied to politics.
"The history of tabloid journalism is rife with all sorts of behind-the-scenes deals," George Rush, former Daily News gossip columnist, told Pompeo. "But to put that offer so bluntly and brazenly, to a man who has the intelligence and power to impale you on your own sword, was stupid."