11 more US billionaires join Gates, Buffett charity pledge

NEW YORK: Eleven billionaires added their names on Tuesday to the effort by Bill Gates and Warren Buffett to donate half their fortunes to charity, bringing the total to 92.

The newest members of the club include Netflix chief executive Reed Hastings, Intel co-founder Gordon Moore, and Charles Bronfman, the Canadian-born former head of Seagram Co.

The Giving Pledge, announced in 2010, was launched by Microsoft mogul Gates and investment guru Buffett who want to convince the richest people in the country to give 50 percent or more of their fortune to charity.

The group includes CNN founder Ted Turner, New York Mayor Michael Bloomberg, Oracle co-founder Larry Ellison and Hollywood director George Lucas, as well as Buffett and Gates.

"We've said from the beginning that this is a long-term effort, so it's exciting to see continued progress over the last two years," said Gates, who is co-chair of the Bill & Melinda Gates Foundation.

"This new group brings extensive business and philanthropic experience that will enrich the conversation about how to make philanthropy as impactful as possible. Their thoughtfulness and deep commitment to philanthropy are an inspiration to me, and I'm sure to many others as well."

The newest members also include Manoj Bhargava, India-born founder of 5-hour Energy; and Dan Gilbert, founder and chairman of Quicken Loans and majority owner of the Cleveland Cavaliers.

Also pledging were Peter Lewis, chairman of Progressive Insurance; Jonathan Nelson, founder of Providence Equity Partners; Jorge Perez, chairman and CEO of The Related Group; Albert Lee Ueltschi, founder of FlightSafety International; and Symphony Technology Group founder Romesh Wadhwani.

New pledges also came from Claire Tow, co-founder one of a major cable television company, and husband Leonard Tow, the CEO of New Century Holdings.

Lewis said in his pledge letter that he would make donations aimed at "promoting a healthy democracy, broad civic participation and public policy -- from the support of progressive think tanks to leadership training for public servants, to investigative journalism, ethics in government, and a democratic media."

He added that another effort he would fund is "is taboo for most philanthropists yet exemplifies disastrous public policy... our nation's outdated, ineffective marijuana laws."

Lewis said he has already funded efforts to enact laws that give patients access to marijuana as relief for pain and nausea and has "made no secret of being one of those patients myself, using marijuana to help with pain following the amputation of my lower leg."

"A majority of Americans are ready to change marijuana laws, yet we continue to arrest our young people for engaging in an activity that is utterly commonplace," he said.

Bronfman said in his letter that philanthropy "is in the DNA of my family", adding that his parents were active participants in Jewish, local Montreal and Canadian charities.

"The dining table conversation was a place for discussing what was important to them in that world -- it is no surprise then, that each of us has contributed to society."

Buffett bucks the trend by buying newspapers

WASHINGTON - Unfazed by predictions of the death of newspapers, billionaire Warren Buffett is pumping more money into print.

In the past year, one of the world's richest men and sharpest investors has put some US$300 million (S$385 million) into an industry that some view as heading the way of the horse and buggy.

Buffett's Berkshire Hathaway holding company late last year bought his hometown newspaper, the Omaha World-Herald, along with related assets in a US$200 million deal some analysts viewed as a sentimental move.

He followed with a US$142 million deal last month to buy Media General, a chain of 63 newspapers.

He added US$2 million to Lee Enterprises, owner of the St. Louis Post Dispatch and Arizona Daily Sun. That is in addition to other holdings, including The Buffalo News and a stake in The Washington Post Co.

"I believe newspapers that intensively cover their communities will have a good future," Buffett said in a message last month to his newspaper employees.

He said Berkshire "will probably purchase more papers in the next few years" and that he will "favor towns and cities with a strong sense of community."

Still, the investment comes amid dire predictions for the newspaper industry, which has been battered by sharp drops in print circulation and advertising, and getting only modest revenues from online services.

A research note from the financial firm Moody's earlier this month gave the US newspaper industry a "negative" outlook, saying that digital initiatives are failing to make up for "significant secular pressures."

"Although newspaper companies seek to capitalize digital revenue through an array of channels, it's unlikely that these gains will be large enough to offset print losses," Moody's analyst John Puchalla wrote.

"A complete transformation away from print entirely would eliminate the sizable costs of print production and distribution, but the revenue loss is still too great for companies to make the switch yet."

Analysts say Buffett, the world's third richest individual with a net worth estimated at US$44 billion, is doing what he does best: making a "contrarian" bet by investing in a company or sector beaten down by negative sentiment.

"Newspapers are one tenth of the price they were a decade ago," said Ken Doctor, a media analyst with the research firm Outsell.

Doctor said Buffett is finding value in these companies because they often own hard assets, including real estate and broadcast properties, and have a strong brand name in their communities.

"These are great community assets, they have great brands," Doctor told AFP.

"Buffett is, at base, an opportunistic investor... See a business, or industry deep in the doldrums, and think you can leverage money out of a deal, one way or the other, and you've got an opportunity."

In an interview with The Washington Post, the 81-year-old Buffett said his move was "not a soft-headed business decision." But the investor said he sees prospects best for newspapers in smaller cities with "a feeling of community."

Still, to make the investment pay off, Buffett will have to find a way to stem losses in the news business, and he has indicated he will seek a new "digital strategy" for the companies.

"We must rethink the industry's initial response to the Internet," Buffett said in his message.

"The original instinct of newspapers then was to offer free in digital form what they were charging for in print. This is an unsustainable model and certain of our papers are already making progress in moving to something that makes more sense."

Dan Kennedy, a journalism professor at Northeastern University, said Buffett's strategy is not yet clear.

"If he means that newspaper companies should use their websites to come up with complementary content - for instance, breaking news, blogs, features that aren't in the paper, that sort of thing - then he may be on to something interesting," Kennedy said.

"But if he's got some sort of 'back to print' crusade in mind, then I'm skeptical."

Doctor said, "We may find out, looking back, that Buffett is just another greater fool, having believed his buy was close enough to the bottom to justify. Or we may see the code broken well enough on new business models."