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Jason Fell

‘This is the Future of Magazines’

Jason Fell Editorial - 08/21/2008-15:35 PM

Layoffs. Reorganizations. Redesigns. New hires. Companies going on the block.

Even during the dog days of summer, there's still plenty of big magazine industry news to populate the home page at And, our readers haven't only been reading the stories—they've been commenting on them, too.

Here's a quick sampling of the more interesting (and unedited) comments we've received in the last few weeks, and the debates they have sparked.

From: How Do Print-Company Professionals Consume Media? Overwhelmingly Online

How we wound up in this mess

Submitted by Paul Conley on Tue, 08/12/2008 - 15:20.

I'm amazed by this quote: "I have to say I was surprised. I always assumed my media consumption habits were everyone else's." That, I think, explains quite nicely how B2B media wound up in this mess.

It's not a mess.

Submitted by Barbara Shepherd on Tue, 08/12/2008 - 16:59.

It's a sea change, like the evolution of opposable thumbs or the advent of electrical power grids. And re credibility--Establishing credibility is the same online as it is in print (except of course print has many, many more resources and established procedures than onlin). All you need is a set of principles, reliable fact checking, separation of church & state and an audience with good judgment. Off the cuff, I can think of several B2B publications that are not in my opinion credible sources of information.

From: 5280 Gets Fairey to Design DNC Obama Cover


Submitted by Anonymous on Wed, 08/06/2008 - 16:07.

People think this is a good cover? If I where Barack Obama I would be offended. He look confused in this image and his eyes are red like a devil. The coloring almost makes it look like this is some sort of Republican propaganda.

i think its fantastic

Submitted by Anonymous on Wed, 08/06/2008 - 20:26.

This is the first new Shepard piece out since his HOPE posters yes? Very cool that it's supporting a Denver rag and not a Democratic prop piece... i think its fantastic... kudos 5280.

From: The Technology Behind Esquire's Flashing Cover

The future

Submitted by Anonymous on Wed, 07/23/2008 - 14:55.

This is the future of magazines. If they can sell this at $6 a pop, it's only a matter of time before every article can appear on one page sliding side to side, up and down. And if they are reusable for 90 days, magazines won't even need to buy paper anymore. People can simple download the issue to the e-ink paper. Seems like a no-brainer to me.

The End is Near

Submitted by Anonymous on Wed, 08/13/2008 - 09:23.

If I want to read from a display, I use that thing called the computer. I hear that computer screend have color, and this thing called the Internet has lots of good stuff on it. I think this is a bizarre combination of two dying media formats. I think a bolder move would have been to print single page notices on cardstock, proclaiming how Esquire has been freed of the bonds of print, and will reside on the Internet from now on.

From: Sources: Wasserstein is Cygnus Buyer

Heading in the wrong direction

Submitted by Michael Turro on Thu, 08/14/2008 - 17:29.

Somebody should tell Mr. Wasserstein that buying big, bloated media companies that are chained to mind bending legacy and integration issues is so TwenCen (20th cetury).

Salary-Hiring Freeze

Submitted by Overland Park on Thu, 08/14/2008 - 22:00.

I am so pleased the salary freeze combined with the extra work I have picked up because of layoffs and a hiring freeze are allowing us to purchase another company. I am certain we'll Pentonize them right into declining revenue and disenfranchised employees. Enjoy our expertise Cygnus...

From: More Layoffs at Entrepreneur


Submitted by Anonymous on Thu, 08/14/2008 - 21:41.

The current owner's and execs' arrogance and poor judgment is what is bringing down this company. Asking for $200 million in today's market, pushing out critical employees (starting with those who left earlier this year), bringing on editorial staff with no business journalism background ... the list goes on. Sadly, those left who are just trying to do their jobs are the ones getting hurt -- and the readers who have relied on Entrepreneur for so many years.

Jason Fell

Source Memo: ‘Virtually No Advertisers Will Commit to Long-Term Ad Programs’

Jason Fell M and A and Finance - 08/14/2008-10:45 AM

As first reported by FOLIO: this week, financial publisher Source Media is reorganizing its more than 60 magazines into four business groups—banking, capital markets, technology and professional services—and is recasting editorial staffs for each of its individual brands and rolling editors into combined units for each of the four new groups, "pooling" editorial by market.

In an 1,830-word memo announcing the reorganization to staffers, CEO Jim Malkin provided a detailed account of the hurdles plaguing the financial services and information publishing industries, and the debt market:


To All SourceMedia and Accuity people:

I'd like to take some of your time to fill you in on the state of our business. In reading our publications, watching or reading the news or following the political debate, we are seeing a downward business cycle and economic fall off of significant proportions. It is my belief that the earliest this cycle will turn will be by the end of 2009.

I am certain that you are all familiar with the current state of the financial services industry, the conditions of the evolving information publishing industry and the state of the debt market. I want to explore in this letter how these national, regional and industry trends impact our company and what we intend to do so that we emerge healthy and robust when this cycle turns.

Financial Services Industry

Our clients in the financial services industry are getting clobbered. Wall Street lost a record $11.7 billion in 2007 and another $22.4 billion in the first quarter of 2008. Wall Street is expected to cut 25,000 jobs from its September 2007 peak of 188,000 jobs - a 13.4% decline. It is estimated that 74,000 financial services jobs have been cut over the past 12 months.

Our clients who advertise to our readers don't know what they can successfully sell to firms that are unsure of their future. There are fewer industry participants to subscribe to our services and virtually no advertisers who will commit to long-term advertising programs.

Information Publishing Industry

We have talked about the change in readers' habits in the electronic age. We have talked about the change from print to on-line advertising. Although our on-line advertising has been increasing at a healthy rate and in line with industry averages, print remains the bread and butter of our revenues.

It should come as no surprise to you that our print advertising revenues are experiencing a significant fall off this year. Other media and newspaper companies are reporting print advertising to be off by 5% to 25%. SM's print advertising is off of last year's levels by 17% or $6.8m. Print based revenue still comprises almost 57% of our total revenue.

Debt Market

Our debt, which we have been paying down since our acquisition in November 2004, stands at $172m. Despite our healthy "performing loan" status and our low leverage ratio of about 4.5X, our interest costs have increased by 30%, which translates into an additional $4.3m of cash interest payments that we have to pay each year to our lenders.

What does this mean to you?

It means that the entire enterprise, SM and Accuity, has to be positioned to:

A: Establish a structure that can operate more effectively in this environment - more effectively in terms of content creation, product development and sales/marketing execution.

B: Take advantage of the cycle when it eventually turns upward (and remember that the entire economy relies on the financial services sector to kick-start the rest of the economy).

C: Generate sufficient cash to cover expenses, which now include the additional $4.3m in interest and, crucially, to generate the monies needed to provide funding for growth initiatives.

This is the third major down cycle I have managed through. Although it is the most severe, I am confident that the steps we take will see us through this and that we will emerge a stronger and better business. We will be better positioned to support our clients and to serve their needs with integrated solutions that provide value.

After extensive discussions with people within our organization and with outside consultants, our Board of Directors has approved our new operating structure and has reaffirmed its desire to grow SourceMedia and Accuity into the future under Investcorp's ownership.

The SM publishing business will be divided into four communities:


Banking will now comprise the following groups: American Banker, Banking magazines, the Mortgage Group, the Payments Group and Credit Union Journal. Jeff Scott, as President and Managing Director of Banking, will report to me. Tim Murphy, John DelMauro and Frank Diekmann will report to Jeff within this community.

Capital Markets

Capital Markets will comprise the Bond Buyer, FCC and the majority of the Capital Markets newsletters. Mike Stanton will head this Community as Executive VP and Managing Director of Capital Markets.

All existing sales positions including Naz Bayazit, Lou Fugazy, Bill Baneky and Tara Gonzales will report to Mike.


This group will comprise DMR, BIR, HDM, INN, SIN and Traders. Rob Whitaker will head this Community as Executive VP and Managing Director of Technology. Reporting to Rob will be Ken Heath of Traders and Dan Rubinetti who will assume responsibility for sales management for the rest of the group.

Professional Services

This group will combine the Investment Advisor, Employee Benefits and Accounting Groups. Mike Dukmejian will be joining SourceMedia as Executive VP and Managing Director of Professional Services. Mike joins us from Time Inc where he was Group Publisher of The Fortune/Money Group and, Publisher of Mutual Funds Magazine, Director of Sales Development, Sports Illustrated and Corporate Marketing Director for Time Inc. Reporting to Mike will be Jim Callan, Dan Goldemen and Jack Lynch.

New product development is an area in which SourceMedia needs to devote more effort and resource. Accordingly, we are establishing two new positions within the company to drive new growth initiatives.Adam Reinebach and Patrick Toner will each serve as VP of Business Development. Adam will work with the Professional and Technology Groups reporting to Mike and Rob, while Patrick will work with the Banking and Capital Markets Groups reporting to Jeff and Mike.

Each of the community heads noted above will have responsibility for strategy, acquisitions, partnerships and the revenues for all of their brands' activities in print, on-line, conferences and events.Therefore we will be disbanding the central conference group and re-aligning its resources to serve the needs of our communities. Sales and program development will report into the communities, marketing will report into central marketing and operations will report to our central operations group. As advertisers place high value on face to face interactions with clients, it is crucial that program development, editorial and marketing work closely and effectively together.

One of the most commercially successful community-building brands that our company has established is the 25 Most Powerful Women in Banking franchise. I believe the success of MPWIB should serve as a template for the development of niche communities for each of our brands. We have the reach and the distribution and now need to aggressively move forward in creating and maintaining similar franchises. This is perhaps our biggest new opportunity. Holly Sraeel will assume the newly created position of SVP Brand Management, reporting to me. She will develop professional networking communities for our brands following the WIB model and will assume the additional title of President, 25 MPWIB.

The Editorial functions for all of our products will be combined into one group under David Longobardi as Executive VP, Chief Content Officer. This will permit us to more readily share content, to provide consistent quality to our readers, to facilitate our journalists' career paths across the organization and to support our brands with editors who can draw from a large pool of talent and resources. I feel very strongly that we need to do more to support our efforts in content development and creation across our organization; despite the best efforts of an editorial council, we need to be more proactive still in seeking cross-brand opportunities and establishing best practices and common standards for our products. We will be working through this year to implement the workflows and processes, and establishing the relationships necessary to make Editorial function optimally for our communities. Further details will be issued under separate cover by David Longobardi later today.

As a result of the changes in our communities, senior managers David Greenough, Greg Gillespie, Bill Dimodugno, Maria McDaniel, Bill Bell, Robert Mitchell and Tim Reifschneider will leave SM. We wish them the best in the next chapter of their careers.

There are a number of other changes which will more effectively support the new organization described above, and they are:

Andria Wirth has decided to devote the next chapter of her career to raising her new daughter and we trust that she will be as successful in that endeavour as she has been with SM. Rich Antoneck will be promoted to Sr. VP, Financial Operations and will be responsible for our Finance and the Accounting Groups. Reporting to Rich will be Rebecca Knoop who will be promoted to Executive Director, Finance.

Further details will be issued under separate cover by Bill Johnston later today.

Classified Advertising will be centralized under Steve Andreazza. This group will sell classified advertising across all our brands and will be lead by Joanne Kao, reporting to Steve.

Marketing will be restructured to provide coverage of all marketing activities (advertising, audience development, delegate and exhibitor marketing) under a Group Marketing Director for each community. The Marketing Directors will report to Anne O'Brien with a strong dotted line to the community heads. Further details of this organization will be issued under separate cover by Anne O'Brien later today.

As noted earlier, conference operations will become part of our central operations group under Celie Baussan. All hotel bookings, venue management and other operational activities for our conferences and events will be handled by that group.

The NRS and Accuity businesses will be consolidated under the leadership of Hugh Jones, President of Accuity. There is a huge market opportunity for us in the compliance and regulatory space across our business units. John Gebauer has done a terrific job of building the NRS business to its current level and will continue to play a key role in the senior leadership of our company. I believe that the benefits of bringing the data and credibility of Accuity together with the expertise and talent of NRS will be significant.

Further details will be distributed under separate cover by Hugh Jones later today.

One additional note to this already lengthy and important communication: in January of this year, Jeff Scott, respected colleague and good friend, began speaking with me about wishing to make a career change. He and I agreed to spend the year working through a process that would best serve the needs of SM and the needs of Jeff who is looking for a more hands on role in a technology and data business. We will continue working through this process and I expect that within the next several months we will hire a new community head for Banking and Jeff will find a position outside of SM.

Please think this through and join the smart people in this organization who will work through the complex details necessary to make this work for our business now and in the future. As noted, there will be further communications about each group. Should you have questions please address them to your manager or to me.


Jason Fell

Auto, Tech Mags Among Biggest Losers in First Half

Jason Fell Audience Development - 08/11/2008-12:02 PM

RELATED: Consumer Magazines Take Huge Hit at Newsstand

With the economy down and gas prices skyrocketing, its no wonder that automotive and technology magazines saw some of the industry's biggest circulation declines over the first half, according to the Audit Bureau of Circulations consumer magazine FAS-FAX report out today.

Of all consumer magazines, some of the biggest decliners, in terms of total paid and verified circ, included Stock Car Racing (-27.3 percent), Car Audio and Electronics (-24.2 percent), Lowrider (-22.3 percent), Sport Compact Car (-26.2 percent) and Super Street (-23.8 percent). The hemorrhaging didn't end there (see chart below).

Autoweek and Car and Driver magazines were the bright spots with gains of 6.9 percent and 0.2 percent, respectively.

In the technology industry, computer heavyweights PC World and PC magazine saw respective declines of 17 percent and 8.8 percent. Apart from the industry's other circ decliners (see chart below), Condé Nast's Wired saw a 6.1 percent increase and Popular Mechanics a 0.8 increase in paid and verified circ.

Although consumers have seen some relief at the pump recently—with average gas prices dipping under $4 per gallon—it's unclear when these industries, and the economy, will rebound.

What's even more sad is magazines overall are taking a hit from these suffering markets. According to the Publishers Information Bureau's first half 2008 report, automotive ad pages for the period plunged 21.3 percent from the first half in 2007. The technology ad category was the second-largest decliner with ad pages falling 17.5 percent.

Automotive Circ Decliners

Stock Car Racing-27.3
Car Audio and Electronics-24.2
Sport Compact Car -26.2
Super Street-23.8
Sport Truck -12.8
National Speed Sport News-12.4
Four Wheeler-10.1
Nascar Illustrated-6.7
Road & Track -1.3
Motor Trend -0.9
Sport Driver -0.6


Technology Circ Decliners

PC World -17
Computer Power User-15.1
Computer Shopper -10.1
PC magazine-8.8
PC Gamer-8.4
Technology Review-3.6

Source: ABC

Jason Fell

Black Republican Association Mag Raises Eyebrows

Jason Fell Editorial - 08/05/2008-13:00 PM

“Democrats embrace their child molesters.”

“Top 10 Democratic sex scandals in Congress.”

“Democrats wage war on God.”

Not the kind of headlines you'd expect from an association magazine.

But in fact they are, according to a report in Florida’s Gainesville Sun newspaper, from the Black Republican, the magazine of the National Black Republican Association.

After scrolling through the association’s Web site, I saw a story by the magazine’s publisher and executive director, Frances Rice, that claims African-Americans have been “barraged for over 40 years with falsehoods about the Republican Party by the Democrats who have hijacked the civil rights record of the Republican Party and taken blacks down the path of Socialism.”

In the story, Rice writes that Democrats founded the Ku Klux Klan, which became the “terrorist arm of the Democratic Party to lynch and terrorize Republicans—black and white.”

According to the Sun story, Rice “thinks of herself as an ‘iron butterfly’ positioned to expose the ‘Democratic Party’s racist past’ in time to convince African-Americans to vote for John McCain.” The president of the Tampa (Florida) Black Republican Club said the magazine’s editorial is “a fruitless debate and it may conjure up more ill will toward the party. We should be spending money on debating the Democrats on the issues.”

The mission of the association, according to the site, is to be “a resource for the black community on Republican ideals and promote the traditional values of the black community which are the core values of the Republican Party: strong families, faith in God, personal responsibility, quality education, and equal opportunities for all.”

I hadn’t heard of this magazine, nor the association before reading the newspaper report. I e-mailed Rice for some details about both (size of the association, distribution of the magazine, etc.) but she hasn’t responded.

On one hand, it’s refreshing to see an association publication take such a hard line—even controversial—stance on a topic. I’m not sure, however, that accusatory editorial like this is a productive motivational tool, regardless of your political preference.

Jason Fell

Esquire’s Granger: Magazine Medium ‘So Compelling We All Should Do More with It’

Jason Fell emedia and Technology - 07/28/2008-16:48 PM

Since the report last week about Esquire's flashy e-paper October anniversary cover—and our follow-up on the technology behind it—I've been hearing/reading a lot of negative opinions about it.

One Web site called it obnoxious. Rex Hammock said it was "the worst use of technology by a magazine." Fast Company, in a blog post, estimated that the manufacturing process increases the issue's carbon footprint by 16 percent over other typical print publications. But, if you ask Esquire editor-in-chief David Granger, the technology could help revolutionize the way we read magazines, beyond the printed page and online.

"When I talk to groups I sometimes speak about the days I had when I'd get the new issue of Esquire and go through it and think to myself, ‘Fuck, it's still a magazine,'" Granger said in a recent interview with FOLIO:. "What I mean is that the medium is so compelling that I and we should all be able to do more with it. The magazine experience is one of the last remaining opportunities to enter a hermetically-sealed world, an edited experience of our culture created by someone else. And, more importantly, it's an experience that encourages you to stay in it rather than constantly bounce in and out of it.

"We have an amazing medium, print, and if we can enhance the experience of it by putting new technology to use, then all the better," he said.

Bob Sacks, an industry consultant and frequent proponent of technology, says that Esquire's flashy cover may be a small step overall but offers a glimpse of what's to come in the next few years.

"It's not a representation of what e-paper was designed for, but doing the cover is the right thing to do," Sacks says. "It will be a demonstration of what it can be used for. In the near future we all will have flexible e-paper readers in our pocket and will be able to access all the magazine and books you want."

Right now, the technology is expensive and, if you believe Fast Company, not very green. Granger says that, with time, he hopes the technology will become cheaper. Maybe, after some refining, the application will become more realistic and environmentally-friendly, too.

Jason Fell

‘Positive’ Magazine Shelved Over Misspellings

Jason Fell Editorial - 07/28/2008-15:24 PM

Alright, try to follow this insanity.

Cook County magazine, what was supposed to be a new title commissioned by Cook County, Illinois board president Todd Stroger, has been shelved due—of all things—to misspellings and grammatical errors.

According to a report in Chicago’s Sun-Times, Stroger hired an editor to develop and publish a magazine in a “non-threatening news environment that ensures regular, positive press—to counter-balance negative press often found in the mainstream media.” Today, though, 5,000 copies of the 32-page glossy are stacked in Stroger’s office with no place to go. The cover story of the launch issue is an interview with Stroger that apparently contains a number of misspellings and omissions.

“I was asked to review [the magazine] and decided not to distribute it—not because of content, but errors and omissions in the article,” a spokesperson for Stroger said in the report. “Judging on grammatical stuff—something misspelled or that’s not a complete sentence—falls back on the president. And this is a Cook County magazine. I have to find a way to get rid of [the issues]. I’m not distributing them.”

I haven’t seen a copy of the magazine myself but, I mean—wow. What a wasted effort. What a waste of paper.

You’d think if you’d go to the trouble of launching a mouthpiece magazine you’d at least use spell check.

Jason Fell

Journalism’s Darker Façade Abroad

Jason Fell Editorial - 07/16/2008-11:02 AM

Some days I’m just happy that I’m a journalist working in the U.S.

As I was trolling the Internet this morning, as I do every morning, I came across this Reuters report about prosecutors raiding the offices of a French auto magazine, Auto Plus, which allegedly published unauthorized pictures of a yet-to-be-unveiled new car. In the raid, authorities confiscated computers and documents containing names and contacts of sources, and arrested one staffer.

While this particular story reminds me of the sometimes disturbing practices of celebrity-hounding paparazzi (apparently French auto publishers regularly pay for unauthorized advance car photos), I think it points to a larger global issue of freedom of the press.

(Can you imagine Wired’s offices being raided for publishing an unauthorized photo of the new iPhone? You can’t, because it doesn’t happen here.)

From stringent government controls to incarcerations to suspicious murders, journalists abroad the are facing difficult times while trying, as we all do, to report the news that’s important to their readers. Last month, for instance, we reported how China banned the June issue of the English-language version of Time Out Beijing. China’s General Administration of Press and Publications—known for its strict media guidelines—claiming that the magazine lacks a required printing permit. The ban came at a suspicious time, however, coming two months before the Summer Games in China this August.

Even in France—according to the Reuters report—recent broadcast reforms enable President Nicolas Sarkozy [pictured above] to name the head of the country’s public television network.

Sure, things here in the U.S. aren't always perfect, but at least we’re protected working here, in a mostly fair, safe environment. At least we can do our jobs without fearing that we will be thrown in jail, or murdered.

Jason Fell

Magazines That Managed to Grow Ad Pages in the First Half, We Salute You

Jason Fell M and A and Finance - 07/14/2008-11:38 AM

Last week, the Publishers Information Bureau released first half figures, with consumer magazine advertising pages continuing to decline, slipping 7.4 percent over the first half and 8.2 percent for the quarter.

In our spare time (because we have so much), we grouped a number of the magazines into topical categories to see how ad pages (the more telling statistic) fared in business magazines, newsweeklies and celebrity titles during the first half. Overall, not so well.

But it wasn’t all grim news. In the business sector, Condé Nast’s Portfolio posted a 69 percent spike (it launched last spring) and Mansueto Venture’s Fast Company continued to grow with ad pages jumping from 196.43 during the first half last year to 258.09 this year—a 31.4 percent increase.

Ad pages at newsweeklies continued to plummet, the worst being U.S. News & World report, down 30.3 percent. Music magazines also continued to see dwindling ad pages, save for Spin which pulled in 307.37 pages over the half, up 15.3 percent from last year.

In celebrity magazines, OK! realized a 31.7 percent spike in ad pages for the half. InTouch Weekly’s pages jumped 14.4 percent.

We also took a look at boating magazines (an industry that’s particularly vulnerable to the soft economy and skyrocketing crude oil prices—boating sales and services for 2007 was about $37.5 million, down 5 percent from 2006, according to the National Marine Manufacturer Association’s 2007 Recreational Boating Statistical Abstract). Among the decliners were Bonnier’s Yachting and Motorboating, down 22 percent and 23.6 percent respectively.

It will be interesting to see how these categories perform during the third and fourth quarters.



2008 Ad Pages

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Fast Company












Fortune Small Business




Harvard Business Review








Kiplinger's Personal Finance














2008 Ad Pages

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The Week








U.S. New & World Report






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Entertainment Weekly




InTouch Weekly




Life & Style












People En Español








Us Weekly






2008 Ad Pages

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Rolling Stone














2008 Ad Pages

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Cruising World








Power & Motoryacht




Power Cruising




Sailing World




Salt Water Sportsman









Jason Fell

Pink Editor Convinces City ‘Men at Work’ Signs are Discriminatory

Jason Fell Consumer - 07/10/2008-09:48 AM

Score one for magazine editors standing up for gender equality, even with a bottle of spray paint in-hand.

Cynthia Good, founding editor of Atlanta-based women’s business magazine Pink, has reportedly convinced city transportation officials there to discontinue using “Men at Work” and “Men Working Ahead” road work signs and replace them with more gender-neutral signs that read “Workers Ahead.”

The changes come after police apparently visited Good’s office last month on a complaint that she spray painted the letters “wo” onto a “Men at Work” sign. Whether or not she was the culprit is unclear, but Good began a letter-writing campaign, complaining about the signs to the mayor and Georgia governor. Her efforts paid off.

And, it seems, Good’s ambitions lay far beyond just Atlanta. “We’re calling on the rest of the nation to follow suit and make a statement that we will not accept these subtle forms of discrimination,” Good told the Atlanta Journal-Constitution.

So, good for Good. We’re all about gender equality here at FOLIO:—in the magazine industry, and elsewhere. We wish her luck.

Jason Fell

Rumor Mill: Penton May Be Cygnus Buyer

Jason Fell M and A and Finance - 07/07/2008-16:53 PM

The latest gossip surrounding the apparent impending sale of Cygnus Business Media is that Penton Media (probably backed by parent Wasserstein & Co.) is the buyer. Today might be the final day of the due diligence process, according to three sources, all of whom are former Cygnus employees who heard the rumblings second hand.

When asked for comment, a Penton spokesperson wrote in an e-mail to FOLIO: that Penton has “nothing to say at this point.”

DeSilva + Phillips managing partner Reed Phillips—who along with fellow managing partner Roland DeSilva spoke with Cygnus co-CEO Carr Davis in a closed-door meeting last month—said he could not confirm the rumors.

If the buyer is in fact Penton/Wasserstein, one M&A source, who wished to remain anonymous, said the interest would make sense. “Wasserstein had an interest in Cygnus when it was on the block a couple of years ago. To acquire Cygnus, you have to be comfortable with a wide-ranging b-to-b company that serves a range of verticals, which obviously they are with Penton.”

Cygnus went on the block in 2006 but subsequently pulled off the market that year.

The source suggested that Cygnus could be asking for about $200 million to $240 million, or about 8x estimated EBITDA.

Jason Fell

Cygnus Sale Looming?

Jason Fell M and A and Finance - 07/02/2008-15:47 PM

Rumors have been swirling about the potential sale of Cygnus Business Media since co-CEOs Tony O’Brien and Carr Davis [pictured], in an interview with FOLIO: last month, indicated that the company is exploring a sale.

According to three sources contacted by FOLIO:, the Cygnus corporate management team was in New York for about a week recently, most likely meeting with prospective buyers. Now, sources say a buyer has stepped up and that (as early as today) Cygnus is moving toward the due diligence phase of negotiations.

Is the buyer from private equity or another publisher? So far, I haven’t been able to substantiate the rumors.

A Cygnus spokesperson declined to comment other than to point out that Davis already has said that the company has been approached with inquiries and is exploring “a process.” Cygnus went on the block in 2006 but subsequently pulled off the market that year.

It will be interesting to see how this turns out—and what sort of return owner ABRY Partners will see.

Check back to for more on this developing story.

Jason Fell

UPDATE: Indie Magazine Asks Readers for $20,000 by July 1

Jason Fell M and A and Finance - 06/27/2008-16:24 PM

UPDATE: It appears the magazine got the cash it needed.

Arthur magazine is almost dead.

When logging onto the self-proclaimed “transgenerational global counterculture” music magazine’s Web site today I was redirected to a page asking for a monetary donation. Arthur, according to the page, “will die” if it doesn’t raise $20,000 by July 1.

In a note posted online, Arthur editor/owner Jay Babcock indicated that after buying out his ex-partner and relaunching the magazine about a year ago, he “maxed out” his personal and business credit cards. Like other struggling publishers, Babcock attributes Arthur’s financial woes to lower than expected ad revenues and increased production and distribution costs.

“We have worked very hard with very little resources: some of us could afford to work pro bono, others could afford to work at well below market, still others couldn’t afford to work for Arthur but did it anyway,” Babcock wrote. “Still, we have bills to pay, and debt to service. Starting up again costs money. And my credit cards are now maxed out.”

Launched in 2002, Arthur is a free bi-monthly magazine distributed in various places like record shops, used bookstores, coffeehouses and art galleries. As of this afternoon, they apparently had collected $15,600.

Arthur isn’t the first to extend a hand to readers to help pay the bills. Following last July’s shape-based postal rate restructuring, The Nation, a political weekly with a circulation of 181,070, saw its rates go up 18 to 20 percent—and turned to subscriber donations to remain in business.

It’s a shame, and disheartening, that Arthur, like many well-respected magazines, finds itself in this predicament. While I’m not intimately familiar with the magazine’s specific financial details I can only assume that it would have been beneficial to give itself more than about a week to raise $20,000.

I guess time will tell if Arthur survives. The clock is ticking.