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Jason Fell

Celebrity Magazines See Big Advertising Resurgence

Jason Fell Consumer - 07/12/2010-15:44 PM


After a tumultuous 2009, during which a measly 18 consumer magazines grew their advertising pages in the face of the economic downturn, the first half of 2010 is shaping up exceedingly more positive. According to the Publishers Information Bureau’s second quarter and first half magazine advertising reports, a whopping 130 titles increased ad pages during the second quarter. The three-month period marked the first time in nine long, hard quarters, that consumer magazines reported gains in both rate card-reported advertising revenue and pages.

PIB-tracked titles reported 43,427.11 advertising pages between April and June, a gain of 0.8 percent versus the same three-month period last year. Meanwhile, estimated revenue for the period closed at more than $5.21 billion, a 5.7 percent increase.

It feels good reporting that.

The strong performance during the second quarter pushed a solid (although not as dramatically up) report over the first half. Ad pages slipped 4 percent while estimated revenues increased 1.2 percent.

Celebrity magazines, which like so many others that saw severe declines in advertising last year, have pulled a 180 so far this year. According to PIB, all but one in the category (Us Weekly) reported double-digit page gains. The biggest jump came from Bauer’s Life & Style, which saw pages grow 40.4 percent to 242.51. Celebrity powerhouse People reported a 15.8 percent gain during the period (to 1,768.68 pages) while sister Time Inc. titles Entertainment Weekly—which many in media thought was headed for oblivion—boosted pages 22 percent (to 502.53 pages).

Here, I’ve taken a look at PIB numbers for some of the other magazine categories that have been hardest hit over the last couple of years. Although the majority of consumer boating titles are continuing to struggle, it appears that other categories are seeing improvement—either in gains or just significantly fewer losses.

AUTOH1 2010H1 2009% CHNG
Car and Driver388.59374.283.8
Hot Rod232.38256.72-9.5
Motor Trend344.16351.6-2.1
Road & Track378.37361.334.7
H1 2010H1 2009% CHNG
Cruising World395.93424.85-6.8
Power & Motoryacht412.46476.39-13.4
Sailing World183.65196.6-6.6
H1 2010H1 2009% CHNG
Bloomberg Businessweek575.46590.49-2.5
Fast Company210.68171.2823
Harvard Business Review175.17168.833.8
H1 2010H1 2009% CHNG
The Week306.67277.9210.3
H1 2010H1 2009%CHNG
Entertainment Weekly502.53412.0122
In Touch456.68393.4216.1
Life & Style242.51172.6940.4
Us Weekly824.85827.33-0.3

Jason Fell

Are Media M&A Reports Just a Bunch of Self-Serving Fluff?

Jason Fell M and A and Finance - 07/09/2010-12:25 PM

Two of the media industry’s biggest investment banks/deal brokers put out reports in recent weeks, looking back at the mergers and acquisitions that have been announced over last six months. According to the report from Berkery Noyes—which was released this week and analyzes merger and acquisition activity of private equity companies in the Information Industry—while total aggregate transaction value decreased by 9 percent to $13.54 billion during the first six months compared to the second half last year, the total number of transactions (143) increased 22 percent.

The first half report from the Jordan, Edmiston Group—which tracks deal announcements across 10 media sectors and compared them to the same period in 2009—says media M&A is “heating up,” and that six of those 10 sectors showed “strong” growth over the first six months of the year.

Sounds like great news, especially after the media M&A market nearly dried up last year. But not everyone is buying the rosy picture painted by reports like these. “Do not believe some of these self-serving reports that the large industry investment bankers are releasing,” says one media M&A professional who wishes to remain anonymous. “They are just talking up their book and trying to generate some activity.”

“I don’t know how or why the M&A firms can say ‘life is great’ over and over again before it begins to wear thin,” another tells me.

Indeed, the traditional markets that many of these brokers serve—the sectors that magazine publishers  have been serving in for years—are still on the decline (see JEGI’s by-sector chart here). “With very few exceptions, all trade show and trade magazine deals for the past two years has not been for strategic growth, but fire sale transactions,” says one M&A player. Other sub-markets, such as regional magazines, seem to still be constricted and tight and might not start to see an uptick until 2011.

Media Isn’t So Traditional Anymore

But the overall media market has changed pretty dramatically over the last few years, with the number of deals (and number of brokers serving those markets) growing much faster in emerging sectors than traditional consumer and b-to-b media. A number of brokers are shifting their focus away from traditional media in favor of those more active, profitable areas.

“While it is true that there have been some distressed sales and divestitures among the more traditional media sectors during the 2010 M&A upturn,” says JEGI COO Bill Hitzig, “consider this: of the nearly 450 transactions covered in our six-month report, the four most traditional media sectors (Newspapers, Consumer Magazines, B-to-B Media and Exhibitions & Conference) accounted for a mere 12 percent of the transactions and less than 8 percent of the transaction value. Take out the CanWest newspaper sale and that number drops to less than 3 percent.

“The real M&A story,” he continues, “is that larger strategic transactions are taking place in the growth sectors (namely Marketing & Interactive Services, Online Media & Technology and Database & Information Services), with both private equity and cash-rich strategics.”

Hitzig goes on to defend JEGI’s quarterly media M&A reports, saying the group “goes to great lengths” to provide an accurate and in-depth look at the market. “We track down deals from dozens of sources to present a thorough update in deal volume and value year-to-date,” he says. “As I said, our six-month report covered nearly 450 transactions, including ours, and the accompanying narrative talked up what is newsworthy, not what is self-serving.”

Berkery Noyes also responded. According to communications director Patrick Scanlan, the firm's reports are data driven and drawn from a proprietary database, which is constantly updated and reviewed.  The deals are “thoroughly vetted by our research department,” he says, and are coded to classify them into various spaces and segments.

"More importantly, BNC has released these Trend Reports throughout the market decline of the past two years, despite little in the way of good news to report,” he tells me. “True to this philosophy, our current reports look not only to the current half-year, but trends across several preceding years.  These trends signify not a miraculous revitalization, but recovery, within certain segments of our covered industries.  Had we intended to distort this pattern for our own benefit, we would have compared first half of 2009 to the first half of 2010, a juxtaposition that would have displayed a meteoric rise in M&A activity.”

But, after all, even if reports like these come off as  boastful to some, then maybe that isn’t such a terrible thing right now. “After the last 18 months, I don’t even mind the bragging [by the larger investment bankers],” says another M&A player. “At least they are finding something to brag about.”

Jason Fell

Newspaper Magazines Get Nod as Best Launches

Jason Fell Consumer - 07/08/2010-09:52 AM

I was looking over Samir “Mr. Magazine” Husni’s report this week on new magazine launches during the first half of 2010 (there were 56, he says) when I clicked through to another of his recent posts—his list of the 25 most notable launches over the last 25 years. Appropriately, 25 magazines made his list.

Scrolling through it, Husni has included some of the obvious and most deserving launches, including Men’s Health (1986), Martha Stewart Living (1990), Wired (1993), O the Oprah Magazine (2000) and The Week (2001). With a list of only 25 titles spanning as many years, it’s easy to assume that the larger publishing companies would dominate Husni’s list. And they do. Time Inc. publishes five, Bauer has three, Conde Nast has two, etc.

What was somewhat surprising, given the limited number of picks over so many years, was that Husni selected American Profile (launched in 2000), Relish (2006) and Spry (2008)—all three newspaper magazines produced by the Publishing Group of America. I shot Husni an e-mail to find out why more than 10 percent of his list is devoted to these publications. Here’s his response:

American Profile was selected because of the breakthrough in marketing strategy that PGA used in introducing a magazine back then to the C and D counties, a market that was ignored for years by this genre of magazines... It became a big hit with the newspapers and in turn with the newspapers’ customers, the readers.  When Relish was launched, it was launched with 6 million circ. (now almost 15 million) and Spry with 9 million circ.  

Who in their right mind nowadays launches a new magazine with millions of circ.?  It is for this gutsy move and the rebirth of old channel of distributing magazines that I honored all three titles. Innovation in print at its best.  

On a side note, can you imagine the print budget for those magazines, where the majority of new magazines average 70,000 circ.?

Jason Fell

‘Social Media Doesn't Work Very Well Without Good, Consistent Content’

Jason Fell Editorial - 06/16/2010-09:29 AM

The Online Publishers Association yesterday released some topline results from a new research study called “A Sense of Place: Why Environments Matter.” Conducted by Harris Interactive, the study examined how consumers perceive content in different online environments, and whether those perceptions impact consumer responsiveness to advertising. Harris polled more than 2,900 adult U.S.-based online consumers about their perceptions about three environments: media properties (such as,, etc.), portal channels (i.e. AOL News, MSN Money) and social networks (Facebook, MySpace, et al.).

What I found least interesting about the results is that consumers are more likely to trust content on media sites (72 percent) than from portal channels (60 percent). What was most interesting is that, despite all the hype around social media right now, only 23 percent indicated that they trust content from social media environments. Consumers who recall purchasing products from a site's advertisers are significantly more likely to do so from media sites (8 percent) than portal channels (5 percent) or social media (3 percent).

Meanwhile, a new report from the Nielsen Company says the popularity of social media “is undeniable,” with users spending nearly a quarter of their time online on social networks and blog sites.

So, publishers the industry over are rushing to social media platforms to engage their users in the environments they now reportedly spend one out of every four minutes in, but those users still don't trust the content/advertising they find in those environments. Awesome.

I passed the OPA report along to Junta42 founder Joe Pulizzi to get his take on the report. What he found even more interesting than the reported lack of trust/response to social media sites was the study’s omission of the corporate brand environment. I think he has a point. The buzz I’ve heard is that users are increasingly turning to brand sites directly instead of media sites.

“If the goal of the research was to help brand marketers understand the value of placing advertising on branded media sites, the research still leaves a lot of questions unanswered,” Pulizzi tells me.  “The challenge for brand marketers is not necessarily whether they should advertise on a media site versus a portal versus a social network.  They are trying to decide whether they should advertise, or whether they should invest more of their marketing dollars into their own engaging content.”

Pulizzi says that trend of users going directly to a brand’s site instead of media outlets will continue to grow as more content is created by those brands. “Brands are developing sophisticated content strategies to take advantage of not only search, but lead generation programs and social media as well,” he says. “Social media doesn't work very well without good, consistent content.”

Jason Fell

Overheard at the FOLIO: Show

Jason Fell B2B - 06/10/2010-11:52 AM

The following are quotes from various sessions, keynotes and elsewhere during the 2010 FOLIO: Show, which took place this week in New York City. Below that is a collection of tweets from attendees about the show.

Quotes from the Show:

“If you’re not actively thinking about creatively destructing your brand then someone else will.” – David Nussbaum, chairman and CEO, F+W Media

“Invest in technology? That’s a terrible idea.” – Jason Brightman, director of Web design at IDG’s PC World and Macworld, on how technology evolves so quickly (the better investment, he says, is in clever people).

“We imagined ourselves as a venture-backed standalone startup that would attack The Atlantic in print—as a digital insurgent.” – Atlantic Media president Justin Smith on relaunching The Atlantic’s Web site.

“Nothing happens if you don’t have a strong magazine in print. It drives the entire machine.” – Michael Clinton, chief marketing officer, Hearst Magazines

“You are only as good as your click-through rate.” – Karthik Krishnan, senior vice president and general manager, Elsevier’s Pharma Solutions, on online advertising.

“I bought everyone those ‘That was easy’ buttons from Staples and told them to press this and we’re good to go.” – Debbie Klett, associate publisher of Mom Magazine, on finding sales solutions for a client.

“Using Apple is like living in a gated community. It also turns out that it’s a really nice place to be.” – Brightman on Apple’s closed propriety approach.

“As an industry, we’ve done a really good job of devaluing our content.” – Nussbaum

“I don’t know who’s hurting more—the people who hung around the wine bar last night or those who did the Fun Run this morning.” – FOLIO: executive editor Matt Kinsman, while introducing the Wednesday morning keynote.

“I bake brownies for all of my exhibitors. It’s all about passion.” – An attendee on keeping event sponsors happy.

From Twitter:

@danielrmccarthy: Big crowd at the opening session of @foliomag show. Nice to see the energy after a year hiatus.

@bestaudiences: Erick Qualman author of did a fantastic job speaking at #folioshow. Possibly the highlight of the show.

@semmerson: Amazing keynote this am by Justin Smith at #folioshow on reinventing The Atlantic. Keys: go digital-first, differentiate via brand strategy.

@CathyOlofson: HBR's Josh Macht on paywall strategies--channels Henry Ford and cautions against just giving customers a "faster horse" #folioshow

@DanBlank: About to present at the #FolioShow. View from the podium

@AudDevMag: 'Spoon' and 'Eat' were among discarded titles for Food Network mag, says Hearst's Michael Clinton. #folioshow

@MagMe: Good second day at the @foliomag show! liking this trade show buzz

Jason Fell

Video: FOLIO: Shoots Up Field & Stream

Jason Fell Consumer - 06/08/2010-12:34 PM

They asked. We delivered.

The cover of the July issue of Field & Stream [pictured right, on the left] reads “Shoot this magazine!” Inside is a pull out that features an “I (Heart) Guns” image [on the right] that is made up of mini targets.

The cover is part of a promotion for a new Outdoor Channel television program based on Gun Nuts, Field & Stream’s popular online blog. The show appropriately stars the magazine’s two gun editors: David E. Petza (rifles) and Philip Bourjaily (shotguns). According to a New York Times report, whoever takes the most creative photograph of a completed pull-out target will win a Smith & Wesson rifle (Smith & Wesson is a major sponsor of the issue).

We thought the promotion was a pretty cool idea—so much so that executive editor Matt Kinsman and I headed to the local shooting range to see what kind of damage we could inflict. I shot the video. He shot the heck out of the magazine.

See the video below. It isn’t for the faint of heart.

Jason Fell

Time Inc. is Really, Really Excited About Tablets

Jason Fell emedia and Technology - 05/27/2010-21:37 PM

Magazine publishers are jumping on the Apple iPad app bandwagon in droves and arguably for good reason. It’s a sleek, nifty device that not only has captured the attention and imagination (and dollars) of consumers but also is a vibrant new platform for distributing content.

At Time Inc.—which already has launched apps for Time and Entertainment Weekly—the vibe among upper management is of sheer enthusiasm. By upper management, I’m referring specifically to CEO Ann Moore.

During parent company Time Warner’s “Investor Day” Thursday, Moore updated attendees on the division’s recent performance (it reported an operating income of $50 million during the first quarter 2010, versus a loss of $32 million during the same period last year) and gushed about providing paid content through mobile and portable devices.

In addition to the Time and Entertainment Weekly apps, Moore said the company is readying several more from its other magazine brands, including a People app and food, beauty and cleaning apps for Real Simple.

Here’s a sampling of soundbites from Moore’s presentation and the Q+A session that followed, in no particular order:

At my lunch table today, I was shocked that not one of you had an iPad.

We see the next flood of new portable color touchscreens headed to market in the next 18 months as a game changer. It will be the opportunity that content producers like Time Inc have been waiting for to reestablish value for quality digital content. It’s argued that it will be impossible to get consumers to pay for digital content since they’ve grown up getting everything for free. We disagree.

It’s become increasingly clear that customers will pay for trusted quality content that’s easy to access and fairly priced.

The tablet restores something we lost when we went to the Web. Our readers can once again literally touch our content while still having that familiar “lean back” experience of a magazine. In real time, they can link in instead of linking out to the rest of the story on

We’ve spent decades perfecting the craft of making magazines. Now we can apply all that experience to the new virtual magazine, letting consumers feast on incredible images … as well as the stories behind them with just a little flick.

The advertising can be so good it can become content itself. It can help you evaluate products. And when you’ve made your decision it can help to find you a place to buy them.

As more and more hardware manufacturers come in with these e-readers there is just huge demand for our product, for our video product, for my print product—it’ll all be combined. We think very healthy business models will be coming out of it. We’ll be making more money in those businesses than we’ve been making with our traditional dot-coms.

We have a great deal of work to do over next 12 to 18 months, to develop business models, evolve products and talk to consumers and advertisers.

People are paying. We know people will pay for it … it’s a business model that is just really very delicious.

Oh, and one other thing that came up during Time Warner’s Investor Day: the possibility of a Time Inc. sell-off. Company chairman and CEO Jeff Bewkes said (again) that it won’t happen, indicating that it is in an “attractive” position in relation to the competition and in a good growth mode for 2010. “It’s a good business, and we’re good at it,” he said.

Jason Fell

Media’s Ad/Edit Relationship Is Getting Increasingly More Hazy

Jason Fell Editorial - 05/24/2010-14:41 PM

A content producer—whether a magazine editor or a network producer—would like to believe that the content they create can be distributed to consumers without input or intrusion from the advertising side of the business. It’s the great ethical ad/edit divide that our collective media industry has lived and died by for years.

But that immovable boundary has in fact shifted.  Examples have trickled out over the years, most recently with magazines like ESPN the Magazine, Entertainment Weekly and Scholastic Parent & Child featuring ads on their covers. Now comes a report from Mediaweek that American Media’s Shape is under fire by the American Society of Magazine Editors for its May issue—featuring TV personality Ellen DeGeneres on the cover—which the group contends violates its editorial guidelines. Immediately following the cover and abutting the feature story about her are ads for Vitamin Water that include DeGeneres as the spokesperson. According to the report, DeGeneres is wearing CoverGirl makeup in the cover photo and the issue includes a CoverGirl ad with DeGeneres in it.

AMI executives defended the ad/edit execution, indicating that Shape landed DeGeneres for the cover story “long before the ad deal happened.” [More defense from AMI here.] ASME CEO Sid Holt, however, says the issue appears to breach the group’s guidelines. “The issues raised by the Shape piece have to do with editorial decision making,” he tells FOLIO:. “Did the story run because the editor thought it was worthwhile or because the advertiser paid for it? If readers have reason to suspect that editorial decisions are being made simply to sell advertising, not only is the integrity of the publication degraded but the value of the publication to marketers is destroyed.”

(UPDATE: Another example that some might argue is a transgression of the ad/edit guidelines is Playboy founder and editor-in-chief Hugh Hefner’s participation in vodka maker Stolichnaya’s new “Would you have a drink with you?” ad campaign, which includes a TV spot as well as print ads that will appear in a number of publications including Playboy. For the record, though, Hefner, like other celebrity magazine execs, has appeared in a number of other campaigns over the years. Playboy tells me this latest campaign doesn’t affect the magazine’s editorial standpoint.)

This type of edit bending happens across media—not in just magazines. For example, I listen to New York sports talk radio station WFAN to and from work each day. The on-air personalities transition from their commentary to reading ads chock full of personal sentiment all the time.

And it happens in TV, too. I was watching the “America: The Story of Us” series on the History channel last night (yes, I skipped the Lost finale) and was confused when the program went black like it was cutting to a commercial but faded in again with a clip of a pair of historians (who were featured in the program) talking about how the American colonies initially existed for the economic benefit of England. The clip transitions to an ad for Bank of America, which sponsored the series. (Click here to see the ad.) 

I changed the channel once I realized that the History Channel-produced segment was in fact a Bank of America ad. I was put off by it.

How many times does this same thing happen in print media? Do you notice? Do you care? ASME’s Holt says that while product placement might make sense in other media when a distinction can be drawn between entertainment programming and news/information, that distinction is harder to make in print.

“Most magazine advertisers and publishers understand the value of distinguishing between ad and edit,” he says. “Tens of thousands of pages are published every year that adhere to industry standards. Exceptions are just that—exceptions, not the new normal.”

Jason Fell

Give Me Money, Please

Jason Fell M and A and Finance - 05/21/2010-08:04 AM

$40 would buy a pizza and a cheap bottle of wine for me to share with my girlfriend.

$150 would buy a bigger LCD monitor for our new Canon HD videocam.

$300 would buy the roundtrip airfare I recently booked to Puerto Rico (I found a great deal).

$850 would set me up for a good weekend at the casino.

Wishing people would donate money to me? Priceless.

OK, enough about me. The Nation apparently is having a rough go in this “hostile” publishing environment. According to a note from Washington editor Christopher Hayes, the left-leaning political magazine has a $1 million deficit and needs your financial help! (According to its Web site, at least $500,000 of that is from postal rate hikes, thanks in part to “Time Warner lobbyists.”)

The magazine often relies on donations and has set up an “Associates” donation group with special membership benefits, like discussion groups and members-only monthly conference calls, depending on how much you fork over. In fact, Hayes says donations make up more than 20 percent of The Nation’s revenues.

And if you really want to know what your hard-earned donation dollars go to, Hayes is upfront about how it helps:

$35 buys me dinner with a confidential source in New York
$75 pays for an interpreter for a reporter researching a story in Afghanistan
$150 covers an Amtrak ticket to Washington so a writer can testify before Congress
$300 buys a labor reporter's ticket to Detroit for a piece on unemployment
$500 (expenses extra) rewards a brilliant article by a young journalist on Tehran dissidents

Click here to make a donation to The Nation. I’ll let you know when I get the donation form up for that casino weekend I’ve been dreaming about.

Jason Fell

The Wrap Asks: Is the Media Rebound for Real?

Jason Fell M and A and Finance - 05/19/2010-08:11 AM

The Wrap's media columnist and former FOLIO: digital editor Dylan Stableford put together a feature this week that takes a look at the advertising uptick being seen across media right now. He notes that a number of major media players like News Corp. and Time Warner have reported better-than-expected quarterly earnings.

But while the ad market is indeed showing signs of strength across several sectors (thank goodness), Stableford polls a number of media types (myself included) about whether what we’re experiencing might be a full-blown recovery or just the beginning of one.  And, either way, why is no one talking about it?

I argued that while increased earnings and profits are of course good signs, those gains aren’t dramatic, and media companies certainly aren’t waving any victory flags yet. At least two important things need to be taken into consideration beyond simple chart scanning. One is that the first quarter of 2009 was really, really bad. So while a spike in sales so far this year is certainly a good thing the increase is compared to a period last year that saw severe losses.

Secondly, you need to consider how profits are being calculated. Some publishers might be reporting earnings increases or narrower losses, but only after shutting down magazines and cutting workforces. Some companies barely resemble what they were even two, three years ago.

For instance, struggling Playboy Enterprises reported a net loss of only $1 million through the first three months this year, compared to a $13.7 million net loss during the same period in 2009. But let’s not forget all the layoffs, the frequency reduction and how it farmed out all but the editorial operations at the magazine to American Media Inc.

The same is happening at magazine vendors, too. Printer Worldcolor reported a net loss of $29 million during the first quarter of 2010, compared to a loss of $126 million during the same period last year. It even doubled its adjusted EBITDA to $79 million, versus $36 million from last year’s period. But why? The company attributed the value boost to cost containment and reduction initiatives which saw workforce reductions and the closing of six facilities in North America.

No doubt, the remainder of 2010 will continue to be a difficult journey for media companies. Magazine publishers face two paper price increases this summer and are still trying to figure out how to make nickels from the Web, mobile and tablet platforms. But it won’t be without its bright spots. Hopefully the ad recovery will continue and help stem more losses.

In the meantime, let’s not all get carried away and throw any victory parties, just yet.

Jason Fell

Jet Publisher: ‘We Had to Completely Rethink’ Distribution Beyond Print

Jason Fell emedia and Technology - 05/14/2010-12:07 PM

As part of a bigger initiative to reposition Ebony and Jet beyond just their printed magazines, Johnson Publishing has launched The site is constructed around eight topic verticals, including Jet Buzz, Jet Beauty, Jet Love, Jet Connect, Jet Perspective, Jet Style, Jet Music and Jet Video.

And to really make sure that you know that the Jet brand is more than just that struggling print product, Johnson headed into the production studio (and tapped celebrities like actress/singer Brandy and Trey Songz) to put together this slick video press release:

In the video, acting chief marketing officer Melvin P. Young says the idea behind the site is to “create a new value proposition with a distinctive brand identity” and enhance the online user experience. "Users will have the opportunity to participate, actively engage and share very unique experiences across each of these branded sites," Young says of the topic channels.

In the face of a difficult magazine market, Johnson has been revamping the Ebony and Jet brands to include multiplatform content creation. In print, the company has been working to attract new, younger audiences as well as to position the company as the go-to source for news and entertainment with a “unique black point-of view.”

Through the first three months of 2010, Ebony saw advertising pages tumble 30.6 percent compared to the same period last year, according to Publishers Information Bureau figures. At Jet, the losses were even steeper; ad pages declined 33.1 percent.

"As a media company, we had to completely rethink distribution in terms of our content offering beyond print,” Johnson chairman and CEO Linda Johnson Rice says in the video. That means Johnson’s brands are expanding into social media, events, mobile and e-readers and tablets like the Apple iPad.

So does deliver the engaging, go-to online environment Johnson says it was aiming for? You be the judge. Leave your comments below.

Jason Fell

Who Would Buy Newsweek?

Jason Fell M and A and Finance - 05/06/2010-09:48 AM

After years of hefty losses, the Washington Post Company Wednesday said it had hired media and entertainment investment bankers Allen & Company to explore a sale of ailing Newsweek magazine.

What does the market look like for a sale of Newsweek, a magazine that has been losing millions of dollars year-after-year? In 2009, Washington Post Co.’s magazine division, (which also included Budget Travel, until it sold in December) reported an operating loss of $29.3 million. “The losses at Newsweek in 2007 to 2009 are a matter of record,” Washington Post Co. chairman Donald E. Graham said. “Despite heroic efforts on the part of Newsweek’s management and staff, we expect it to still lose money in 2010.”

Just last year, with the economic recession still rolling, several interested parties—including Joe Mansueto, ZelnickMedia and Platinum Equity— stepped forward when McGraw-Hill put BusinessWeek, a magazine that reportedly lost more than $40 million the year before, on the block. It eventually was acquired by Bloomberg LLC for only $5.9 million, after tax.

One might assume that Newsweek could muster just as much interest. In fact, some parties apparently have already expressed an interest. Editor Jon Meacham told the New York Observer that he was contacted Wednesday by “two billionaires” who inquired about buying the magazine. Meacham himself said he’d consider rounding up some investors to place a bid. And then there was Henry Blodget, CEO and editor-in-chief of Business Insider, who offered only $1. (Remember OpenGate Capital’s $1 acquisition of TV Guide from Macrovision in 2008?)

Jokes aside, I polled a small handful of our sources in the M&A market to pull together a list of companies/publishers that may make good suitors for Newsweek. Among them were OpenGate, Reuters, Politico, Dennis Publishing (owner of The Week), Newsmax, Tina Brown’s the Daily Beast and the Huffington Post. I fired off e-mails to reps at all but Reuters and the Daily Beast but couldn’t immediately reach any for comment.

Some, of course, seem more likely than others. Upstart Politico, which is backed financially by Allbritton Communications owner Robert Allbritton, would make an interesting suitor if for no other reason than it was co-founded by Washington Post defectors John Harris and Jim VandeHei. Newsmax, which one source tells me will “very possibly” make a move for Newsweek, would be an interesting buyer because the Republican news monthly effectively could  snuff out a liberal-leaning rival. I’m sure Dennis Publishing owner Felix Dennis is still flush with cash after the sale of Maxim. But would the outspoken entrepreneur actually get involved?

No doubt, it will be difficult for any potential player to justify buying Newsweek. The lag time between closing a deal and somehow making it profitable again would be long and weighed down with additional losses.

A strategic buyer with deep pockets would make the most sense—a company that thinks buying Newsweek would add to the value/profitability of its own core business. That’s essentially what happened with Bloomberg and BusinessWeek. Not surprisingly, though, Bloomberg already has said it is not exploring a bid for Newsweek.

Would others like Time magazine parent Time Warner or The Economist Group be willing to take the risk? I’m not so sure.