Opinion » Lingo Yarns

How to spend $85 million


Last week, the secret winner of the $220.3 million Powerball lottery announced his identity with a flurry of press appearances. The 33-year-old Boisean Brad Duke told Forbes that he wants to turn his $85 million (after-tax, lump-sum winnings) into $1 billion in 15 years. That means he won't be giving it away, but neither will he keep it all in T-bills. He's going to need a variety of investments, and money managers say he's going to need to be a little risky.

To reach his goal, he'll need to invest the majority of his money in stocks, spread it around and count on a nice 10-15 percent increase. With the remainder, he'll need to invest in riskier enterprises.

I get the feeling that a guy like Brad has a sense of home, a desire to improve the great community he lives in. I would hope that he consider investing in Idaho businesses and keep the money circulating within the the state. And I, just like everyone else, have a good idea.

Gannett, publisher of USA Today and the Idaho Statesman, is the newspaper company with the top profit margin of them all. Year after year Gannett enjoys a 20-28 percent profit margin from the 101 newspapers it owns, and the Idaho Statesman is consistently one of the top earners with pretax profits in the 40 percent range. In 1997-the most recent year I could scrounge up data off the Internet-the Statesman had 46.1 percent operating profits, making it the third-best paper for Gannett. Now, I've heard Boise's two biggest media sources control a super-majority of the available advertising dollars in Boise. The biggest is the Statesman with what I'd guess is easily in the double-digit million dollar range. Unfortunately, the 40-plus percent profits don't stay in the local economy. They go back to headquarters on the East Coast, often supporting those other Gannett papers with real competition.

For a few million dollars-maybe a couple million more to make sure-a local, free daily newspaper could get started that competed directly with the Idaho Statesman for a share of this revenue. Even if you cut your profit margin to 10 percent, we're still talking a couple million dollars profit a year. Gannett has a monopoly stranglehold on this community, siphoning off millions of dollars and giving what most agree is a vanilla product. I know it could be done better.

So, Brad, if you're reading this, I know of a great little newspaper staff ready to take on a challenge.