Taking out the Trash: Death of Print edition
Media Coverage takes a look at a quintet of stories that show tough times ahead for the game magazine market.
There's a rule of thumb in journalism that it takes three occurrences of something to make a trend. So you could say that these five articles on problems with print gaming journalism might almost constitute almost a double-trend of popular opinion against the medium.
The conventional wisdom that game magazines are being replaced by their online competition is nothing new, of course. But the confluence of chatter around the topic in the last week is notable. Be warned, game magazines – the vultures are circling, and they're hungry.
NP, RIP?
Perhaps the biggest buzz around the print-is-dead issue this week came from an IGN report that the venerable Nintendo Power magazine may be shutting down or restructuring in the wake of massive layoffs planned for September. The report remains an unconfirmed rumor for now, but IGN's Matt Casamassina has shown a talent for breaking Nintendo-related scoops in the past -- see his prediction of Super Paper Mario heading from the GameCube to the Wii, for instance.
The rumor has led many to speculate that the magazine might decide to go completely digital, perhaps being reborn as a downloadable channel on the Wii. It's an intriguing theory, especially in the wake of Sony's decision to shutter the demo-disc-based Official PlayStation Magazine in favor of direct demo downloads to the PS3 and PSP. The possibilities are exciting -- imagine reading a review for a Wii game on your TV and then being able to click a link to download and play a demo immediately.
Frankly, I'd be surprised if either rumor turns out to be true, though. Nintendo's record with online content for the Wii has been spotty at best, and they've shown little to no interest in downloadable game demos thus far. As for the print edition, if Nintendo Power can't survive with its strong brand loyalty, relatively healthy subscriber base, and a marketing subsidy from one of the big three console manufacturers, then what chance does any other game magazine have?
Undercirculation overseas
In overseas death-of-print news, GI.biz reports on a group of game journalists that seemed all too willing to pile on the dead tree medium during a panel at the recent Nordic Game conference. Apparently, the game press market in Norway and Denmark is relatively magazine-free already, and what magazines do exist have a pretty bad reputation. "They're really driven by advertisements, so it seems to me there's a really unhealthy relationship between the PRs and the people who write the magazines," said panel moderator and Denmark journalist Thomas Vigild. "We don't have magazines like in the U.K. where you can say, 'No way, I won't print your PR bulls**t.' That's much harder to do in Denmark because they still need the income from the advertisers."
But the once-proud English print market is also in decline, according to panel member Patrick Garratt of EuroGamer. ""For the unofficial magazine arms race in the U.K., where we had 20 - 30 magazines in massive bags with two discs on the cover and stuff like that - no one cares anymore. It's over." In other words, in England you can lead a consumer to a newsstand full of gaming mags, but you can't make him read.
IDG's advertiser/editor troubles
Speaking of magazines putting up with PR bulls**t, PC World editor-in-chief Harry McCracken decided he'd had enough of it when he resigned his post last week. You might know PC World as the highest-circulation part of IDG, publisher of age-old gaming mag GamePro. McCracken's departure was spurred on by an executive's refusal to run an article critical of Apple, one of the magazine's biggest advertisers.
The article was later run and McCraken reinstated, but the PR damage had already sunk in to an extent. A NeoGAF thread title sums up the opinion succinctly: "Money-hats confirmed at GamePro Publisher."
Accusations of advertiser interference are rampant in the game press, and while both the print and online fields are affected, magazines seem to get the brunt of the "sell out" labeling. Perhaps this is because online outlets are by their nature a bit more transparent and inviting of reader discussion. Perhaps it's because some magazines tend to devote most of their limited space and cover opportunities to heavily advertised games. Whatever the case, these accusations are notoriously hard to prove unless someone makes a principled stand like McCracken did. By the way, if anyone wants to go on the record with insider info, let me know.
Ziff Davis on the down swing
Folio, the magazine about magazines, joins in the fray with a meaty feature on the ailing health of tech mega-publisher Ziff Davis. The piece is full of dreary numbers and quotes, but the most damning bit comes right at the beginning when an Edelman PR rep reveals that his freebie subscription of PC Mag goes right in the trash can. If you can't even give the thing away to PR people, you know you're in trouble.
The article goes on to tell of Ziff's slow but steady transition from print to web, which seems only natural for a tech-savvy audience. Ziff Game Group VP John Davison admits that the publisher's gaming properties were "late to the online world," but 1UP's quick rise to prominence in the online gaming world shows just how much they've made up for lost time.
Disposable Media on disposable magazines
Online magazine Disposable Media rounds out our look at print naysayers this week with an excellent examination of the relative pros and cons of online versus print in the U.K. market. While print magazines take the brunt of the abuse, the feature makes sure to look at the problems with the online game press as well, most notably issues with their reputation. "To be honest, it annoys me that the reputation of games journalism is dragged down by everyone who can afford a domain name," says British freelancer Kieron Gillen. "But when professional ones screw it up on such a regular basis, it seems a little churlish to moan."
Still, the general consensus seems to be that print magazines are having a tough time adjusting to their new position in the order of things. As EuroGamer's Rob Fahey puts it, the people behind print magazines have to "accept that they'll never be the dominant force in games coverage ever again, and I think that might be too painful for a lot of magazine writers to accept just yet."
— —
Saturday, May 19, 2007
Friday, May 18, 2007
Can Top Washington Writers Save Time?
Can Top Washington Writers Save Time?
By Harry Jaffe
http://www.washingtonian.com/articles/buzz/4130.html
Time managing editor Richard Stengel has big plans for the three marquee Washington journalists he’s hired.
“All are best in their class,” Stengel says. “They fit perfectly into my strategy.”
Stengel, who took over the reigns of Time earlier this year, hired David Von Drehle and Michael Grunwald from the Washington Post. He took Mark Halperin from ABC News.
The three hires came on the heels of layoffs across Time Inc.’s magazines, from Sports Illustrated to People. The company shuttered Life magazine. Stengel cut 50 from Time magazine’s staff in March. The newsweekly closed bureaus in Chicago, Atlanta, and Los Angeles.
Now Stengel is doing some selective hiring.
“What do we do as journalists?” Stengel asks. “We write, we report, we think. In terms of people who do these things, David and Michael are as good as anybody anywhere.”
Mark Halperin, ABC’s political director for years, will help in “framing the conversation,” he says. “His metabolism is perfect for the Internet.”
Having sliced his staff, Stengel has made room for writers he can build into brand names.
“They are already great brands within our community,” he says. “We want to make them more potent in the broader community.”
Time will tell whether Stengel’s strategy will succeed. Many mainstream media publications are struggling, and newsweeklies like Time, Newsweek, and U.S. News top the list of endangered species in the new digital world.
“We feel bullish all the way around,” Stengel says. “I’m fixing the roof when the sun is shining.”
From the outside, Time’s roof looks a little leaky. Industry sources say its ad pages are down by double digits. Part of its business strategy has been to cut circulation from 4 million to 3.25 million. It has also reduced advertising rates.
The magazine has made a big gamble by changing its publication cycle, moving up its deadlines to Thursday for an earlier close, hoping to get the magazine to readers on Friday. But many readers still receive the magazine Monday or Tuesday.
Von Drehle, Grunwald, and Halperin will fit into a Time that’s been reconceived and redesigned. Gone is the omniscient voice instilled 84 years ago by founder Henry Luce. The new Time has bylines on the cover and commentary by Joe Klein, Peter Beinart, and Michael Kinsley, among others.
Newsweek, Time’s main competition, took the personality brand-building route years ago. Evan Thomas, Jonathan Alter, Howard Fineman, and Robert Samuelson have had their names on Newsweek’s cover and their faces on its pages for decades.
Taken together, Time’s changes seem to be tending toward the Economist’s style of essays and columns rather than hard news reporting.
“We have to be both timely and timeless,” Stengel says. “That’s what I think keeps the magazine around.”
Stengel also wants to keep people coming to Time’s Web site, which has been the beneficiary of resources cut from the print publication. He points to Von Drehle’s coverage of the shooting massacre at Virginia Tech.
“David went down to Blacksburg, filed for time.com, and also wrote a great piece for the magazine,” he says. “That’s the idea now—there’s nobody who’s all one and none of the other. Everybody gets that.”
Stengel says readers are getting great reads from Swampland, Time’s online political blog. Ana Marie Cox, famous for creating the gossipy, R-rated content of the Wonkette web site, is Swampland’s brand-name writer. Joe Klein pitches in.
Says Stengel: “It’s been a roaring success.”
In fact, Swampland is hard to distinguish among the hundreds of political blogs. Yes, Cox adds her trademark snarky tone, Joe Klein’s insights spice up the site, and Halperin will bring his years of experience in connecting with the “googling monkeys” he branded while overseeing ABC’s political blog.
But Swampland wanders across the same terrain covered by newspaper blogs from the Washington Post, the New York Times, and dozens of others, including Slate and Salon.
In Von Drehle and Grunwald, Stengel has placed his bets on two fine Washington journalists. But can they keep Time magazine from seeing its readership and ad pages continue to decline? If the answer to survival is Swampland, then the marriage of Ana Marie Cox and Mark Halperin could either fire up the site or burn it down.
By Harry Jaffe
http://www.washingtonian.com/articles/buzz/4130.html
Time managing editor Richard Stengel has big plans for the three marquee Washington journalists he’s hired.
“All are best in their class,” Stengel says. “They fit perfectly into my strategy.”
Stengel, who took over the reigns of Time earlier this year, hired David Von Drehle and Michael Grunwald from the Washington Post. He took Mark Halperin from ABC News.
The three hires came on the heels of layoffs across Time Inc.’s magazines, from Sports Illustrated to People. The company shuttered Life magazine. Stengel cut 50 from Time magazine’s staff in March. The newsweekly closed bureaus in Chicago, Atlanta, and Los Angeles.
Now Stengel is doing some selective hiring.
“What do we do as journalists?” Stengel asks. “We write, we report, we think. In terms of people who do these things, David and Michael are as good as anybody anywhere.”
Mark Halperin, ABC’s political director for years, will help in “framing the conversation,” he says. “His metabolism is perfect for the Internet.”
Having sliced his staff, Stengel has made room for writers he can build into brand names.
“They are already great brands within our community,” he says. “We want to make them more potent in the broader community.”
Time will tell whether Stengel’s strategy will succeed. Many mainstream media publications are struggling, and newsweeklies like Time, Newsweek, and U.S. News top the list of endangered species in the new digital world.
“We feel bullish all the way around,” Stengel says. “I’m fixing the roof when the sun is shining.”
From the outside, Time’s roof looks a little leaky. Industry sources say its ad pages are down by double digits. Part of its business strategy has been to cut circulation from 4 million to 3.25 million. It has also reduced advertising rates.
The magazine has made a big gamble by changing its publication cycle, moving up its deadlines to Thursday for an earlier close, hoping to get the magazine to readers on Friday. But many readers still receive the magazine Monday or Tuesday.
Von Drehle, Grunwald, and Halperin will fit into a Time that’s been reconceived and redesigned. Gone is the omniscient voice instilled 84 years ago by founder Henry Luce. The new Time has bylines on the cover and commentary by Joe Klein, Peter Beinart, and Michael Kinsley, among others.
Newsweek, Time’s main competition, took the personality brand-building route years ago. Evan Thomas, Jonathan Alter, Howard Fineman, and Robert Samuelson have had their names on Newsweek’s cover and their faces on its pages for decades.
Taken together, Time’s changes seem to be tending toward the Economist’s style of essays and columns rather than hard news reporting.
“We have to be both timely and timeless,” Stengel says. “That’s what I think keeps the magazine around.”
Stengel also wants to keep people coming to Time’s Web site, which has been the beneficiary of resources cut from the print publication. He points to Von Drehle’s coverage of the shooting massacre at Virginia Tech.
“David went down to Blacksburg, filed for time.com, and also wrote a great piece for the magazine,” he says. “That’s the idea now—there’s nobody who’s all one and none of the other. Everybody gets that.”
Stengel says readers are getting great reads from Swampland, Time’s online political blog. Ana Marie Cox, famous for creating the gossipy, R-rated content of the Wonkette web site, is Swampland’s brand-name writer. Joe Klein pitches in.
Says Stengel: “It’s been a roaring success.”
In fact, Swampland is hard to distinguish among the hundreds of political blogs. Yes, Cox adds her trademark snarky tone, Joe Klein’s insights spice up the site, and Halperin will bring his years of experience in connecting with the “googling monkeys” he branded while overseeing ABC’s political blog.
But Swampland wanders across the same terrain covered by newspaper blogs from the Washington Post, the New York Times, and dozens of others, including Slate and Salon.
In Von Drehle and Grunwald, Stengel has placed his bets on two fine Washington journalists. But can they keep Time magazine from seeing its readership and ad pages continue to decline? If the answer to survival is Swampland, then the marriage of Ana Marie Cox and Mark Halperin could either fire up the site or burn it down.
Survey: Newsprint is people's preference
Survey: Newsprint is people's preference
A poll commissioned by an industry group shows newspapers still reign.
By DIANA MIDDLETON, The Times-Union
Newspapers are still the reigning source of news, advertising and information, according to a recently released survey conducted by American Opinion Research. Eight in 10 adults read a newspaper per week, and Florida readers are 6 percent more likely to pick up a newspaper on the weekdays and 7 percent more likely to read a Sunday newspaper than the national average, the survey said.
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The survey was commissioned in December by the Florida Press Association, a nonprofit organization for newspapers and journalism-related businesses. It was conducted by American Opinion Research, which is headed by a former pollster from USA Today, which could raise some questions about the ethical foundation of such a survey.
In the 51-page report, findings included:
About 82 percent of Florida adults read a printed newspaper during an average seven-day week.
Print newspapers are the most-used venue for public notices. Two thirds of those surveyed said they would read less public notices if they were moved online.
About 66 percent of adults use the newspaper as their main source of local sales and shopping information.
The study paints a rosy picture of an industry that's recently experienced some turmoil. Circulation has been dropping for newspapers nationwide for years. Statewide, The Orlando Sentinel recently slashed 24 newsroom positions, and The Florida Times-Union implemented a hiring and salary raise freeze in February, citing declining advertising revenue.
But newspapers' monetary woes are a separate issue from the survey's results, said Dean Ridings, president and CEO of the Florida Press Association.
"The real estate downturn has affected a lot of different media but certainly newspapers," he said. "In addition to the Realtors not selling [homes] and not advertising, the title companies, the home big-box stores are slowing advertising - it's all related to real estate as well. Those have had a huge impact on the revenue of newspapers."
The survey also noted that printed newspapers are losing traction to the Internet when it comes to job, automotive, real estate and major appliance advertisement services for readers.
"Newspapers have lost ground," Ridings said. "But we still have the advantage when it comes to credibility."
The survey findings seem to be sound and comparable to those of national studies, said Rick Edmonds, a media business analyst for the Poynter Institute, a nonprofit institute that studies journalism and ethics issues.
"A contributing factor to the statement about Florida readers reading more and in higher numbers than average could be the higher-than-average age of our population," Edmonds said. "It's factual and a good point, but there's a lot of shifting as the years go by with readers who used to be seven days a week readers and now they read two days a week. When you add all that up, that's a contributing factor to the loss of circulation."
And what about the potential ethical quagmire posed by the survey being commissioned by an institution that stands to gain from positive results?
"It is the kind of survey that points to some of the positives, and there's nothing particularly wrong with that," Edmonds said. "The Florida Press Association is a source of information and research but they're also in the business to promote the industry and that's OK, too."
Florida Press Association's Ridings insists that credibility was critical in disseminating the information, and he was shocked by such positive results.
"We get so lost with the problems that we're having that we tend to lose sight of the overwhelming evidence that newspapers are still a source of information," he said. "For us as an association, credibility is more important than hype. Our members are very skeptical."
It all came down to hard boiled-facts, according to Anthony Casale, CEO of American Opinion Research and former USA Today pollster. "We get paid whether the numbers are good or bad."
A poll commissioned by an industry group shows newspapers still reign.
By DIANA MIDDLETON, The Times-Union
Newspapers are still the reigning source of news, advertising and information, according to a recently released survey conducted by American Opinion Research. Eight in 10 adults read a newspaper per week, and Florida readers are 6 percent more likely to pick up a newspaper on the weekdays and 7 percent more likely to read a Sunday newspaper than the national average, the survey said.
sponsored links
buy a link here
The survey was commissioned in December by the Florida Press Association, a nonprofit organization for newspapers and journalism-related businesses. It was conducted by American Opinion Research, which is headed by a former pollster from USA Today, which could raise some questions about the ethical foundation of such a survey.
In the 51-page report, findings included:
About 82 percent of Florida adults read a printed newspaper during an average seven-day week.
Print newspapers are the most-used venue for public notices. Two thirds of those surveyed said they would read less public notices if they were moved online.
About 66 percent of adults use the newspaper as their main source of local sales and shopping information.
The study paints a rosy picture of an industry that's recently experienced some turmoil. Circulation has been dropping for newspapers nationwide for years. Statewide, The Orlando Sentinel recently slashed 24 newsroom positions, and The Florida Times-Union implemented a hiring and salary raise freeze in February, citing declining advertising revenue.
But newspapers' monetary woes are a separate issue from the survey's results, said Dean Ridings, president and CEO of the Florida Press Association.
"The real estate downturn has affected a lot of different media but certainly newspapers," he said. "In addition to the Realtors not selling [homes] and not advertising, the title companies, the home big-box stores are slowing advertising - it's all related to real estate as well. Those have had a huge impact on the revenue of newspapers."
The survey also noted that printed newspapers are losing traction to the Internet when it comes to job, automotive, real estate and major appliance advertisement services for readers.
"Newspapers have lost ground," Ridings said. "But we still have the advantage when it comes to credibility."
The survey findings seem to be sound and comparable to those of national studies, said Rick Edmonds, a media business analyst for the Poynter Institute, a nonprofit institute that studies journalism and ethics issues.
"A contributing factor to the statement about Florida readers reading more and in higher numbers than average could be the higher-than-average age of our population," Edmonds said. "It's factual and a good point, but there's a lot of shifting as the years go by with readers who used to be seven days a week readers and now they read two days a week. When you add all that up, that's a contributing factor to the loss of circulation."
And what about the potential ethical quagmire posed by the survey being commissioned by an institution that stands to gain from positive results?
"It is the kind of survey that points to some of the positives, and there's nothing particularly wrong with that," Edmonds said. "The Florida Press Association is a source of information and research but they're also in the business to promote the industry and that's OK, too."
Florida Press Association's Ridings insists that credibility was critical in disseminating the information, and he was shocked by such positive results.
"We get so lost with the problems that we're having that we tend to lose sight of the overwhelming evidence that newspapers are still a source of information," he said. "For us as an association, credibility is more important than hype. Our members are very skeptical."
It all came down to hard boiled-facts, according to Anthony Casale, CEO of American Opinion Research and former USA Today pollster. "We get paid whether the numbers are good or bad."
Thursday, May 17, 2007
Magazine Suspends Its Run in History
Magazine Suspends Its Run in History
By CHARLES McGRATH
http://www.nytimes.com/2007/05/17/arts/17heri.html?_r=1&adxnnl=1&oref=slogin&ref=arts&adxnnlx=1179401519-DttO7Edd5Fwuor+pZDfZqg
After more than 50 years American Heritage, the magazine that furnished not just the minds but, in its original hardcover format, the dens of generations of American history buffs, is suspending publication, its editor, Richard F. Snow, said last week.
The bimonthly magazine, which is owned by Forbes Inc., has been for sale since January, and in the absence of a buyer, Mr. Snow said, the publishers have decided to put the next issue, June-July, on indefinite hold. For at least the time being, however, American Heritage will continue to maintain a Web site.
That leaves Mr. Snow and his staff, which has dwindled to four from a dozen, in limbo, where they have been since just before Christmas, when they were informed that the magazine was going on the block. “It’s a little like sailing the Flying Dutchman through the fog,” Mr. Snow said. “On the other hand, I’ve been here for 40 years, so I can’t really bitch about job instability.”
The magazine has always been a bit of an anomaly among American publications.
The circulation is currently 350,000, or as high as it has ever been, and hundreds of those readers can still be reliably counted on to write in arguing about the true causes of the Civil War or, as happened recently, to point out that the author of a World War II article doesn’t know the difference between the M-1 rifle and the M-16, which didn’t come in until Vietnam.
American Heritage was founded in 1954 by James Parton, Oliver Jensen and Joseph J. Thorndike Jr., refugees from Life, who from the beginning broke most of the rules of magazine publishing. They determined not to accept ads, for example — on the ground that there was a “basic incompatibility between the tones of the voice of history and of advertising” — and instead charged a yearly subscription of $10, a figure so steep at the time that readers were allowed to pay it in installments. They also published in clothbound, hardback volumes with full-color paintings mounted on the front.
The format was an instant hit with readers, who instead of tossing back issues often shelved them in their bookcases, but it initially confounded the United States Post Office, which decreed that American Heritage could use neither the book rate nor the periodical one. That ruling was eventually overturned, but not until the magazine had almost bankrupted itself by paying for parcel post.
The first editor of American Heritage was Bruce Catton, a Civil War historian who wrote in the inaugural issue in December 1954 that “the faith that moves us is, quite simply, the belief that our heritage is best understood by a study of the things that the ordinary folk of America have done and thought and dreamed since first they began to live here.” In the beginning, at least, that meant a fair amount of WASPy nostalgia and a steady ration of stories about the Civil War. That inaugural issue, for example, includes a piece about a Union general who was falsely accused of treason in 1862, as well as articles about the country store, the Fall River steamship line and a lament by Cleveland Amory about the decline of New York men’s clubs.
Mr. Snow, 59, went to work in the American Heritage mailroom in 1965, when Columbia University insisted he take a little time off, and joined the staff full time when he finally graduated, in 1970. He has been there ever since, and in 1990 he became the magazine’s sixth editor, succeeding Byron Dobell.
Either he was a perfect fit to begin with, or over the years he has taken on many of the characteristics of his workplace, for he now closely resembles his own magazine. He is quite youthful looking, on one hand (probably because he is one of those people who mature early and then never change), and a little old-fashioned on the other. He speaks in perfectly turned paragraphs and may be the last person left in New York to unself-consciously use “indeed” as an exclamation.
He favors gray suits and sweater vests, his telephone manners are impeccable, and he has a bubbling, high-pitched voice that turns a simple “hello” into something that resembles the opening bar of a Broadway show tune. Like his magazine he has an almost insatiable curiosity and is particularly expert on the Revolutionary and Civil Wars, not to mention Coney Island amusement rides at the turn of the last century.
Mr. Snow has been at American Heritage long enough that he can remember when it was an empire in the mid-’60s, employing 400 people, with the magazine as a flagship for what was in effect a publishing company selling books, many of them by some of America’s best-known popular historians, by direct mail. He was managing editor in 1980, when the magazine ceased publishing in hardback (except for subscribers who wanted to shell out extra for what Mr. Snow now calls a “padded, leatheroid edition”), and in 1982 when, bowing to economic necessity, it began soliciting ads.
“We all felt very bad about taking advertising,” Mr. Snow recalled. “But it had the odd effect of making us feel we were in touch with the world. There was a sense of a living connection to a process that was actually sort of fun — or at least it was fun while we were getting ads.”
American Heritage remained more driven by circulation than by ads, however. According to Scott Masterson, a senior vice president at Forbes and president of American Heritage, the magazine was losing money when Forbes bought it in 1986 and then bounced back for a while. But in the late ’90s, Mr. Masterson said, it failed to reap the kind of profits that many magazines did, and after 2001 it experienced the same downturn that afflicted the magazine business in general and had trouble recovering.
Part of the problem was the Internet, Mr. Snow said. “We’re really a general interest magazine,” he said. “We don’t play to a history buff in any narrow sense — like the Civil War re-enactors, for example. They can go on the Web and get thousands and thousands of hits.”
Three years ago Mr. Snow and Mr. Masterson decided to embrace the magazine’s aging readership and rejiggered American Heritage to appeal more specifically to baby boomers, mostly publishing articles about things that had happened in their lifetime. The formula was an editorial success, Mr. Snow said, yielding articles like one that appeared in the February-March issue about the Wrecking Crew, an unheralded studio band that played on many hit records in the ’60s and ’70s. But it failed to provide the hoped-for bump on the business end. “Forbes has been very, very patient,” he said. “but basically they’ve been carrying us for a while.”
Over lunch recently at Keens — another venerable New York institution, decorated with old clay pipes and playbills and where he pointed out, for the sake of accuracy, that the famed mutton chop is really lamb — Mr. Snow lamented that the next issue of American Heritage might never get into print.
“We’re just about finished with the issue, and we have a particularly fine piece by Teller, the nontalking half of the Penn and Teller team,” he said. “It’s a superb piece of writing, an essay about a fellow named David Abbott, who was a great American magician.”
Mr. Snow added, “You know, some issues are better than others, but I don’t think there’s been a single one where anything really bored me.”
He said he was still unsure about his own fate, but if need be he could go back to writing historical novels. “I’ve written four,” he said. “Two were loathed by everyone who read them, but two actually got published.” And no matter what happens, he has worked out a crucial point of his severance: He gets to keep his Royal manual typewriter.
“That was the typewriter I was assigned in 1970, and it will follow me to the grave,” he said, and he added: “I wish this were more a sign of granitic stability, but in fact it’s a sign of my computer incompetence. I use it just to type labels, but it works beautifully. Every year someone comes in and cleans it. I don’t think he’s paid by Forbes. He’s some spectral presence who just turns up.”
By CHARLES McGRATH
http://www.nytimes.com/2007/05/17/arts/17heri.html?_r=1&adxnnl=1&oref=slogin&ref=arts&adxnnlx=1179401519-DttO7Edd5Fwuor+pZDfZqg
After more than 50 years American Heritage, the magazine that furnished not just the minds but, in its original hardcover format, the dens of generations of American history buffs, is suspending publication, its editor, Richard F. Snow, said last week.
The bimonthly magazine, which is owned by Forbes Inc., has been for sale since January, and in the absence of a buyer, Mr. Snow said, the publishers have decided to put the next issue, June-July, on indefinite hold. For at least the time being, however, American Heritage will continue to maintain a Web site.
That leaves Mr. Snow and his staff, which has dwindled to four from a dozen, in limbo, where they have been since just before Christmas, when they were informed that the magazine was going on the block. “It’s a little like sailing the Flying Dutchman through the fog,” Mr. Snow said. “On the other hand, I’ve been here for 40 years, so I can’t really bitch about job instability.”
The magazine has always been a bit of an anomaly among American publications.
The circulation is currently 350,000, or as high as it has ever been, and hundreds of those readers can still be reliably counted on to write in arguing about the true causes of the Civil War or, as happened recently, to point out that the author of a World War II article doesn’t know the difference between the M-1 rifle and the M-16, which didn’t come in until Vietnam.
American Heritage was founded in 1954 by James Parton, Oliver Jensen and Joseph J. Thorndike Jr., refugees from Life, who from the beginning broke most of the rules of magazine publishing. They determined not to accept ads, for example — on the ground that there was a “basic incompatibility between the tones of the voice of history and of advertising” — and instead charged a yearly subscription of $10, a figure so steep at the time that readers were allowed to pay it in installments. They also published in clothbound, hardback volumes with full-color paintings mounted on the front.
The format was an instant hit with readers, who instead of tossing back issues often shelved them in their bookcases, but it initially confounded the United States Post Office, which decreed that American Heritage could use neither the book rate nor the periodical one. That ruling was eventually overturned, but not until the magazine had almost bankrupted itself by paying for parcel post.
The first editor of American Heritage was Bruce Catton, a Civil War historian who wrote in the inaugural issue in December 1954 that “the faith that moves us is, quite simply, the belief that our heritage is best understood by a study of the things that the ordinary folk of America have done and thought and dreamed since first they began to live here.” In the beginning, at least, that meant a fair amount of WASPy nostalgia and a steady ration of stories about the Civil War. That inaugural issue, for example, includes a piece about a Union general who was falsely accused of treason in 1862, as well as articles about the country store, the Fall River steamship line and a lament by Cleveland Amory about the decline of New York men’s clubs.
Mr. Snow, 59, went to work in the American Heritage mailroom in 1965, when Columbia University insisted he take a little time off, and joined the staff full time when he finally graduated, in 1970. He has been there ever since, and in 1990 he became the magazine’s sixth editor, succeeding Byron Dobell.
Either he was a perfect fit to begin with, or over the years he has taken on many of the characteristics of his workplace, for he now closely resembles his own magazine. He is quite youthful looking, on one hand (probably because he is one of those people who mature early and then never change), and a little old-fashioned on the other. He speaks in perfectly turned paragraphs and may be the last person left in New York to unself-consciously use “indeed” as an exclamation.
He favors gray suits and sweater vests, his telephone manners are impeccable, and he has a bubbling, high-pitched voice that turns a simple “hello” into something that resembles the opening bar of a Broadway show tune. Like his magazine he has an almost insatiable curiosity and is particularly expert on the Revolutionary and Civil Wars, not to mention Coney Island amusement rides at the turn of the last century.
Mr. Snow has been at American Heritage long enough that he can remember when it was an empire in the mid-’60s, employing 400 people, with the magazine as a flagship for what was in effect a publishing company selling books, many of them by some of America’s best-known popular historians, by direct mail. He was managing editor in 1980, when the magazine ceased publishing in hardback (except for subscribers who wanted to shell out extra for what Mr. Snow now calls a “padded, leatheroid edition”), and in 1982 when, bowing to economic necessity, it began soliciting ads.
“We all felt very bad about taking advertising,” Mr. Snow recalled. “But it had the odd effect of making us feel we were in touch with the world. There was a sense of a living connection to a process that was actually sort of fun — or at least it was fun while we were getting ads.”
American Heritage remained more driven by circulation than by ads, however. According to Scott Masterson, a senior vice president at Forbes and president of American Heritage, the magazine was losing money when Forbes bought it in 1986 and then bounced back for a while. But in the late ’90s, Mr. Masterson said, it failed to reap the kind of profits that many magazines did, and after 2001 it experienced the same downturn that afflicted the magazine business in general and had trouble recovering.
Part of the problem was the Internet, Mr. Snow said. “We’re really a general interest magazine,” he said. “We don’t play to a history buff in any narrow sense — like the Civil War re-enactors, for example. They can go on the Web and get thousands and thousands of hits.”
Three years ago Mr. Snow and Mr. Masterson decided to embrace the magazine’s aging readership and rejiggered American Heritage to appeal more specifically to baby boomers, mostly publishing articles about things that had happened in their lifetime. The formula was an editorial success, Mr. Snow said, yielding articles like one that appeared in the February-March issue about the Wrecking Crew, an unheralded studio band that played on many hit records in the ’60s and ’70s. But it failed to provide the hoped-for bump on the business end. “Forbes has been very, very patient,” he said. “but basically they’ve been carrying us for a while.”
Over lunch recently at Keens — another venerable New York institution, decorated with old clay pipes and playbills and where he pointed out, for the sake of accuracy, that the famed mutton chop is really lamb — Mr. Snow lamented that the next issue of American Heritage might never get into print.
“We’re just about finished with the issue, and we have a particularly fine piece by Teller, the nontalking half of the Penn and Teller team,” he said. “It’s a superb piece of writing, an essay about a fellow named David Abbott, who was a great American magician.”
Mr. Snow added, “You know, some issues are better than others, but I don’t think there’s been a single one where anything really bored me.”
He said he was still unsure about his own fate, but if need be he could go back to writing historical novels. “I’ve written four,” he said. “Two were loathed by everyone who read them, but two actually got published.” And no matter what happens, he has worked out a crucial point of his severance: He gets to keep his Royal manual typewriter.
“That was the typewriter I was assigned in 1970, and it will follow me to the grave,” he said, and he added: “I wish this were more a sign of granitic stability, but in fact it’s a sign of my computer incompetence. I use it just to type labels, but it works beautifully. Every year someone comes in and cleans it. I don’t think he’s paid by Forbes. He’s some spectral presence who just turns up.”
Newspaper Industry Proclaimed "Vibrant, Growing"
Newspaper Industry Proclaimed "Vibrant, Growing"
http://www.centerformediaresearch.com/cfmr_brief.cfm?fnl=070517
According to recent provisional data from the World Association of Newspapers Paid-for newspaper circulation went up 1.9 percent year-on-year to more than 510 million paid-for copies in 2006, and the number of new paid-for titles grew to more than 11,000 for the first time in history.
Gavin O'Reilly, President of WAN and Chief Operating Officer of Independent News & Media Ltd., said "The prognosis for newspapers is actually quite different to conventional wisdom... Those of us in the newspaper business are very confident in the future... producing relevant and compelling products for our local markets, aggregating growing audiences and showcasing them to advertisers."
Based on preliminary figures from more than 200 countries and territories, to be published next month:
Paid-for circulations grew 1.9 percent over 12 months and 8.7 percent over five years. With free newspapers, global circulation grew 4.3 percent year-on-year.
Free daily newspaper circulation more than doubled over five years, to 40.8 million copies a day
More than 1.4 billion people now read a newspaper daily
Paid-for daily titles surpassed 11,000
Print is the biggest advertising medium in the world, says the report, with a 42 percent share. Newspapers alone are the second largest, with 29.4 percent of global advertising spend.
Advertising revenues rose 4 percent in 12 months and 15.6 percent over the past five years
More than 6 billion US dollars have been invested in newspaper printing and production equipment in the last 18 months
O'Reilly noted that "Hidden in those figures is the fact that newspapers... actually represent more than the combined advertising value of radio, cinema, magazines and the internet."
http://www.centerformediaresearch.com/cfmr_brief.cfm?fnl=070517
According to recent provisional data from the World Association of Newspapers Paid-for newspaper circulation went up 1.9 percent year-on-year to more than 510 million paid-for copies in 2006, and the number of new paid-for titles grew to more than 11,000 for the first time in history.
Gavin O'Reilly, President of WAN and Chief Operating Officer of Independent News & Media Ltd., said "The prognosis for newspapers is actually quite different to conventional wisdom... Those of us in the newspaper business are very confident in the future... producing relevant and compelling products for our local markets, aggregating growing audiences and showcasing them to advertisers."
Based on preliminary figures from more than 200 countries and territories, to be published next month:
Paid-for circulations grew 1.9 percent over 12 months and 8.7 percent over five years. With free newspapers, global circulation grew 4.3 percent year-on-year.
Free daily newspaper circulation more than doubled over five years, to 40.8 million copies a day
More than 1.4 billion people now read a newspaper daily
Paid-for daily titles surpassed 11,000
Print is the biggest advertising medium in the world, says the report, with a 42 percent share. Newspapers alone are the second largest, with 29.4 percent of global advertising spend.
Advertising revenues rose 4 percent in 12 months and 15.6 percent over the past five years
More than 6 billion US dollars have been invested in newspaper printing and production equipment in the last 18 months
O'Reilly noted that "Hidden in those figures is the fact that newspapers... actually represent more than the combined advertising value of radio, cinema, magazines and the internet."
Wednesday, May 16, 2007
What's Happened with Industry Mentoring?
What's Happened with Industry Mentoring?
Marketing, Management and Economic Notes from Dr. Joe Webb
http://members.whattheythink.com/allsearch/articleerc.cfm?id=29059
05/16/2007 -- Publishing guru Bob Sacks has written a provocative piece called "Where are Today's Mentors?"
"...there is one aspect in this new world environment that has me worried and concerned. It is the area of mentorship where, it seems to me, we have fallen behind and by that loss as an industry we have been greatly diminished.
What has happened? When and where did we lose the skill set and the will to teach the younglings? Have we so trimmed our business models and our work force that there is just no time to teach and mentor? Have we lost sight of the power of the properly groomed apprentice? Is there just not enough time now with the diminished workforces to add the burden of schooling for the future?"
I wrote back to Bob and this is what I said...
Today's mentors? You mean you want young people to learn from the upper- and mid-level executives who dismissed the Internet, desktop publishing, cross media, and ran bloated, bureaucratic self-protective organizations? Okay. I guess we need to cultivate more narrow-minded bonus-focused executives to discourage the young people below them so that, in frustration, those young people can they out on their own and start their own businesses. If that's what we want, then mentoring is a great idea. Everyone can learn a lot from viewing a bad example. Many successful businesses were created by inspired executives who could not make headway in the organizations they were in.
Seriously, mentoring comes from age diversity in organizations, not just a plan. In many job cutting schemes, middle-management is cut the most, which creates a discontinuity in organizational succession. When companies stop growing, as many big publishing companies have, there can be a serious age-imbalance that interrupts traditional passing of knowledge as one generation looked out for another. What this means is that managers start making old mistakes in new ways because there is no one there to stop them.
Industry growth can cover a multitude of sins; industry decline exposes them and creates new problems. The lack of mentoring is one of them.
There is another issue. Many young people are in a marketplace for which additional education is quite common. For example, one-third of all business students will have MBA's about 10 years after they graduate. Much of what was passed in the mentoring process is now passed in additional outside educational endeavors that were not available in the past.
Technology has also changed things, and standardized them. Desktop publishing has standardized trade practices that were sometimes unique to organizations that would have otherwise required a mentoring process to impart.
I've reflected on my comments a bit more, and I have a couple of things to add. Colleges may emerge to be more about networking than ever. In the past, distance became a primary reason for no longer staying in touch with fellow graduates. The first graduates who have FaceBook, MySpace, instant messaging, and the like, are only now being granted degrees. This could get interesting from a mentoring perspective.
Businesses are getting smaller because of the large varieties of support services that they can buy from others. For example, the ratio of graphic designers who work for design firms compared to those who work as freelancers was a ratio of 3:1 in 1997. We are getting to a stage where that ratio may become almost reversed by 2010 when my analysis of Census data indicates it will become 2:3.
Who mentors a freelancer? Because communications have changed, the networking that used to occur as a result of proximity is now expanded. Those freelancers may be more plugged in than ever... and the mentoring process that was intrinsic to working for a firm in years past might become more powerful among connected freelancers.
Marketing, Management and Economic Notes from Dr. Joe Webb
http://members.whattheythink.com/allsearch/articleerc.cfm?id=29059
05/16/2007 -- Publishing guru Bob Sacks has written a provocative piece called "Where are Today's Mentors?"
"...there is one aspect in this new world environment that has me worried and concerned. It is the area of mentorship where, it seems to me, we have fallen behind and by that loss as an industry we have been greatly diminished.
What has happened? When and where did we lose the skill set and the will to teach the younglings? Have we so trimmed our business models and our work force that there is just no time to teach and mentor? Have we lost sight of the power of the properly groomed apprentice? Is there just not enough time now with the diminished workforces to add the burden of schooling for the future?"
I wrote back to Bob and this is what I said...
Today's mentors? You mean you want young people to learn from the upper- and mid-level executives who dismissed the Internet, desktop publishing, cross media, and ran bloated, bureaucratic self-protective organizations? Okay. I guess we need to cultivate more narrow-minded bonus-focused executives to discourage the young people below them so that, in frustration, those young people can they out on their own and start their own businesses. If that's what we want, then mentoring is a great idea. Everyone can learn a lot from viewing a bad example. Many successful businesses were created by inspired executives who could not make headway in the organizations they were in.
Seriously, mentoring comes from age diversity in organizations, not just a plan. In many job cutting schemes, middle-management is cut the most, which creates a discontinuity in organizational succession. When companies stop growing, as many big publishing companies have, there can be a serious age-imbalance that interrupts traditional passing of knowledge as one generation looked out for another. What this means is that managers start making old mistakes in new ways because there is no one there to stop them.
Industry growth can cover a multitude of sins; industry decline exposes them and creates new problems. The lack of mentoring is one of them.
There is another issue. Many young people are in a marketplace for which additional education is quite common. For example, one-third of all business students will have MBA's about 10 years after they graduate. Much of what was passed in the mentoring process is now passed in additional outside educational endeavors that were not available in the past.
Technology has also changed things, and standardized them. Desktop publishing has standardized trade practices that were sometimes unique to organizations that would have otherwise required a mentoring process to impart.
I've reflected on my comments a bit more, and I have a couple of things to add. Colleges may emerge to be more about networking than ever. In the past, distance became a primary reason for no longer staying in touch with fellow graduates. The first graduates who have FaceBook, MySpace, instant messaging, and the like, are only now being granted degrees. This could get interesting from a mentoring perspective.
Businesses are getting smaller because of the large varieties of support services that they can buy from others. For example, the ratio of graphic designers who work for design firms compared to those who work as freelancers was a ratio of 3:1 in 1997. We are getting to a stage where that ratio may become almost reversed by 2010 when my analysis of Census data indicates it will become 2:3.
Who mentors a freelancer? Because communications have changed, the networking that used to occur as a result of proximity is now expanded. Those freelancers may be more plugged in than ever... and the mentoring process that was intrinsic to working for a firm in years past might become more powerful among connected freelancers.
McPheters Nixes Readership.com
McPheters Nixes Readership.com
Wednesday, May 16, 2007 8:00 AM ET
http://publications.mediapost.com/index.cfm?fuseaction=Articles.san&s=60445&Nid=30432&p=204904
REBECCA MCPHETERS IS CANCELING PLANS to launch a new service, called Readership.com, because of a lack of interest from publishers and an insufficient financial report, according to a report posted online at Mediaweek. In the article, McPheters said her company had raised less than half the $5 million necessary to launch the new service, which counted on support from both media-planning agencies and publishers. McPheters added that many publishers were apparently deterred by the threat of greater transparency in their audience measures. However, she reaffirmed her own belief that greater transparency is ultimately in publishers' best interests. Her plans for the new service were originally announced in October 2005. Funding shortages delayed rollout twice--first to the beginning of 2006, then the beginning of 2007.
Wednesday, May 16, 2007 8:00 AM ET
http://publications.mediapost.com/index.cfm?fuseaction=Articles.san&s=60445&Nid=30432&p=204904
REBECCA MCPHETERS IS CANCELING PLANS to launch a new service, called Readership.com, because of a lack of interest from publishers and an insufficient financial report, according to a report posted online at Mediaweek. In the article, McPheters said her company had raised less than half the $5 million necessary to launch the new service, which counted on support from both media-planning agencies and publishers. McPheters added that many publishers were apparently deterred by the threat of greater transparency in their audience measures. However, she reaffirmed her own belief that greater transparency is ultimately in publishers' best interests. Her plans for the new service were originally announced in October 2005. Funding shortages delayed rollout twice--first to the beginning of 2006, then the beginning of 2007.
Thomson Seals Reuters Deal
Thomson Seals Reuters Deal
by Erik Sass
THE THOMSON CORPORATION WILL BUY Reuters Group PLC for $17.2 billion, the companies announced Tuesday, in a deal that will create the world's largest news and market-data organization. The deal received approval from the Reuters Founders Share Company, a special custodian council empowered to veto deals that it believes endanger the company's mission. It must still clear regulatory hurdles, including antitrust statutes. The new company will be headed by Reuters' chief executive, Tom Glocer.
Provided there are no layoffs, the deal will combine Reuters' roughly 15,500 employees with Thomson Financial's 9,300. (Thomson Corp. has 32,000 total employees, working in divisions covering legal, health care, scientific and tax and accounting news.) Thomson raised some of the funds for the deal with last week's sale of its educational division, including its textbook publishing business, for $7.8 billion.
The buy comes after several strong years at both companies.
In 2006, Reuters' revenue rose 8% to a total $6.6 billion, as profit rose 7% to $1.3 billion on a year-over-year basis. In 2006, Thomson Financial saw revenue rise 6% to $2 billion, while profit increased 13% to $379 million. Together, the companies will control roughly 34% of the news and information market, edging out competitor Bloomberg LP.
The upsides: Thomson strengthens its financial-reporting resources, and Reuters gets exposure in Thomson's other specialty areas. Plus, the companies expect to save about $500 million a year through efficiencies resulting from the deal--again, no word on layoffs.
Both companies' bread-and-butter is still subscription revenue for their business and professional-information products, according to Patrick Quinn, president and founder of PQ Media, which tracks various business information markets. But as price competition with Bloomberg heats up, they may begin incorporating advertising to offset subscription costs. All the elements are there, Quinn noted--including desirable audiences of engaged, well-heeled professionals, high potential for contextual targeting and the digitization of content delivery.
"They really set the tone for leveraging static content into the digital, interactive format over the last decade," Quinn recalled. "As the overall B-to-B information service categories continue to overlap more and more--from digital content to magazines to events and trade shows--there are going to be more opportunities for value-added marketing programs, including targeted advertising."
Quinn says we're not seeing that at the moment, because the companies don't need the extra revenue--they currently get a premium price from their institutional subscribers. "But if price becomes more of a challenge going forward," he says, "I could see them adding that to the model."
by Erik Sass
THE THOMSON CORPORATION WILL BUY Reuters Group PLC for $17.2 billion, the companies announced Tuesday, in a deal that will create the world's largest news and market-data organization. The deal received approval from the Reuters Founders Share Company, a special custodian council empowered to veto deals that it believes endanger the company's mission. It must still clear regulatory hurdles, including antitrust statutes. The new company will be headed by Reuters' chief executive, Tom Glocer.
Provided there are no layoffs, the deal will combine Reuters' roughly 15,500 employees with Thomson Financial's 9,300. (Thomson Corp. has 32,000 total employees, working in divisions covering legal, health care, scientific and tax and accounting news.) Thomson raised some of the funds for the deal with last week's sale of its educational division, including its textbook publishing business, for $7.8 billion.
The buy comes after several strong years at both companies.
In 2006, Reuters' revenue rose 8% to a total $6.6 billion, as profit rose 7% to $1.3 billion on a year-over-year basis. In 2006, Thomson Financial saw revenue rise 6% to $2 billion, while profit increased 13% to $379 million. Together, the companies will control roughly 34% of the news and information market, edging out competitor Bloomberg LP.
The upsides: Thomson strengthens its financial-reporting resources, and Reuters gets exposure in Thomson's other specialty areas. Plus, the companies expect to save about $500 million a year through efficiencies resulting from the deal--again, no word on layoffs.
Both companies' bread-and-butter is still subscription revenue for their business and professional-information products, according to Patrick Quinn, president and founder of PQ Media, which tracks various business information markets. But as price competition with Bloomberg heats up, they may begin incorporating advertising to offset subscription costs. All the elements are there, Quinn noted--including desirable audiences of engaged, well-heeled professionals, high potential for contextual targeting and the digitization of content delivery.
"They really set the tone for leveraging static content into the digital, interactive format over the last decade," Quinn recalled. "As the overall B-to-B information service categories continue to overlap more and more--from digital content to magazines to events and trade shows--there are going to be more opportunities for value-added marketing programs, including targeted advertising."
Quinn says we're not seeing that at the moment, because the companies don't need the extra revenue--they currently get a premium price from their institutional subscribers. "But if price becomes more of a challenge going forward," he says, "I could see them adding that to the model."
Tuesday, May 15, 2007
Magazine Publisher Is Selling Special-Interest Unit for $1.15 Billion
Magazine Publisher Is Selling Special-Interest Unit for $1.15 Billion
By REUTERS
http://www.nytimes.com/2007/05/15/business/media/15mag.html?_r=1&adxnnl=1&oref=slogin&adxnnlx=1179231581-uGvhsx+BQQZfEuASMJ780A
The publisher Primedia said yesterday that it would sell its Enthusiast Media division, which includes magazines like Motor Trend, Soap Opera Digest and Surfer, for about $1.2 billion in cash to Source Interlink Companies, which is controlled by the billionaire investor Ronald W. Burkle through his Yucaipa investment firm.
The unit, which Primedia said in February it would consider selling, includes more than 70 magazines and 90 Web sites. It leaves Primedia with its Consumer Source business, which publishes free consumer guides.
The move comes after Primedia agreed to sell its hunting and fishing magazines to the private equity firm InterMedia Partners for $170 million in cash in December.
Primedia expects $1.15 billion in net proceeds and will be debt-free after the sale.
Source Interlink, which is based in Bonita Springs, Fla., said it expected the all-cash deal to add to adjusted earnings per share excluding one-time costs.
Source Interlink manages retail checkout areas for more than 1,000 retail chains and makes in-store displays. It also manages the delivery of magazines and other entertainment products like DVDs to retailers and consumers.
The deal is expected to close in the third quarter. Source Interlink said Enthusiast Media would operate as a division and would be led by Steve Parr, who heads the group at Primedia.
Primedia said that certain stockholders affiliated with the private equity firm Kohlberg Kravis Roberts & Company who own 61 percent of its shares unanimously agreed to the deal.
Primedia shares rose 34 cents, to $2.83, while Source Interlink shares fell $1.01 cents, to $5.79.
By REUTERS
http://www.nytimes.com/2007/05/15/business/media/15mag.html?_r=1&adxnnl=1&oref=slogin&adxnnlx=1179231581-uGvhsx+BQQZfEuASMJ780A
The publisher Primedia said yesterday that it would sell its Enthusiast Media division, which includes magazines like Motor Trend, Soap Opera Digest and Surfer, for about $1.2 billion in cash to Source Interlink Companies, which is controlled by the billionaire investor Ronald W. Burkle through his Yucaipa investment firm.
The unit, which Primedia said in February it would consider selling, includes more than 70 magazines and 90 Web sites. It leaves Primedia with its Consumer Source business, which publishes free consumer guides.
The move comes after Primedia agreed to sell its hunting and fishing magazines to the private equity firm InterMedia Partners for $170 million in cash in December.
Primedia expects $1.15 billion in net proceeds and will be debt-free after the sale.
Source Interlink, which is based in Bonita Springs, Fla., said it expected the all-cash deal to add to adjusted earnings per share excluding one-time costs.
Source Interlink manages retail checkout areas for more than 1,000 retail chains and makes in-store displays. It also manages the delivery of magazines and other entertainment products like DVDs to retailers and consumers.
The deal is expected to close in the third quarter. Source Interlink said Enthusiast Media would operate as a division and would be led by Steve Parr, who heads the group at Primedia.
Primedia said that certain stockholders affiliated with the private equity firm Kohlberg Kravis Roberts & Company who own 61 percent of its shares unanimously agreed to the deal.
Primedia shares rose 34 cents, to $2.83, while Source Interlink shares fell $1.01 cents, to $5.79.
The Consumer: Terms of Engagement
The Consumer: Terms of Engagement
by Paul Parton
Ah, the perils of a monthly column. As usual, the things that I'm reacting to in early March will seem like ancient history by the time you read this. But, at the risk of seeming redundant, I was struck by Procter & Gamble exec Jim Stengel's keynote speech at the 4A's media conference this spring.
In many ways, the speech was a fairly familiar call for advertisers, media companies and agencies to embrace the consumer more fully. (Specifically, he suggested that marketers and agencies enter into a relationship with the consumer, rather than focusing on selling and telling.)
But a couple of points stood out. First, I hadn't realized that "telling and selling" was a P&G mantra -which explains in many ways why that approach to marketing is so ingrained. What gave me more cause to think, though, was why it's taking creative and media agencies so long to wake up and smell the Folgers.
Why are the traditional approaches to marketing communications still so widespread? Why is there still so much telling and selling? Why is the media industry still driven by buying rather than planning? Why is there still so little focus on the consumer?
Granted, even the most lumbering large agencies (creative or media) will supplement their TV campaign presentation with a little online advertising these days. Hell, they might even present (or at least talk about) viral communication. But at the end of the day, those things are really just repurposed forms of traditional media. A Web banner is usually little more than an animated billboard. Viral recommendations from traditional agencies generally come down to putting commercials online.
These things, though, are examples of media neutrality - or of the idea that it doesn't matter whether you're on TV or on the Web, as long as you connect with the consumer. When agencies endorse this concept, it makes them seem more progressive than they actually are.
Unfortunately, the reality is that media neutrality is the first baby step toward engaging with people the way that people want to engage with brands. Media neutrality is really easy. Because essentially, media neutrality comes down to different forms of the same thing - advertising.
What is significantly more difficult - and yet significantly more important, too - is discipline neutrality.
Being discipline neutral means that you're just as likely to propose a direct marketing solution to a communications problem as you are to present an advertising solution, a search solution or a PR solution.
Discipline neutrality is more difficult to embrace than media neutrality because it demands a working understanding of the strengths and weaknesses of a variety of different communication strategies and the ability to execute them.
Discipline neutrality demands that everything starts with a granular understanding of the consumer how they live, what's important to them and how they engage with the category and the brand. The task, then, is to build a communications plan from that understanding with no preconceived ideas about the form that plan will take or the disciplines or channels that will be used.
Consider, for instance, an agency tasked with jump-starting the sales of a brand of canned soup. The conventional approach would involve creating a TV and print campaign that would, say, extol the benefits of soup as an aid to weight loss. The ads would run in daytime talk shows and women's lifestyle magazines.
The media-neutral approach would be to do the same thing but take it further by sponsoring a segment on "The Biggest Loser," seeding the campaign in weight-loss forums and encouraging bloggers to write about the soup.
The discipline-neutral approach would be to understand how people used the soup and what kind of relationship they had with the brand. It could turn out, for example, that the soup was generally consumed at lunchtime, but only by people with microwaves in their offices. In this case, the discipline-neutral approach could consist of designing a self-heating soup can and launching it with sampling programs at major commuting locations and in city delis.
That kind of approach is the only way brands will ever really be able to develop a relationship with consumers. It's the opposite of "telling and selling." It's understanding customers and finding ways to engage them in a relevant way with genuinely useful innovation. Who'd argue with that?
Paul Parton is the brand-planning partner at The Brooklyn Brothers, a creative collective.
by Paul Parton
Ah, the perils of a monthly column. As usual, the things that I'm reacting to in early March will seem like ancient history by the time you read this. But, at the risk of seeming redundant, I was struck by Procter & Gamble exec Jim Stengel's keynote speech at the 4A's media conference this spring.
In many ways, the speech was a fairly familiar call for advertisers, media companies and agencies to embrace the consumer more fully. (Specifically, he suggested that marketers and agencies enter into a relationship with the consumer, rather than focusing on selling and telling.)
But a couple of points stood out. First, I hadn't realized that "telling and selling" was a P&G mantra -which explains in many ways why that approach to marketing is so ingrained. What gave me more cause to think, though, was why it's taking creative and media agencies so long to wake up and smell the Folgers.
Why are the traditional approaches to marketing communications still so widespread? Why is there still so much telling and selling? Why is the media industry still driven by buying rather than planning? Why is there still so little focus on the consumer?
Granted, even the most lumbering large agencies (creative or media) will supplement their TV campaign presentation with a little online advertising these days. Hell, they might even present (or at least talk about) viral communication. But at the end of the day, those things are really just repurposed forms of traditional media. A Web banner is usually little more than an animated billboard. Viral recommendations from traditional agencies generally come down to putting commercials online.
These things, though, are examples of media neutrality - or of the idea that it doesn't matter whether you're on TV or on the Web, as long as you connect with the consumer. When agencies endorse this concept, it makes them seem more progressive than they actually are.
Unfortunately, the reality is that media neutrality is the first baby step toward engaging with people the way that people want to engage with brands. Media neutrality is really easy. Because essentially, media neutrality comes down to different forms of the same thing - advertising.
What is significantly more difficult - and yet significantly more important, too - is discipline neutrality.
Being discipline neutral means that you're just as likely to propose a direct marketing solution to a communications problem as you are to present an advertising solution, a search solution or a PR solution.
Discipline neutrality is more difficult to embrace than media neutrality because it demands a working understanding of the strengths and weaknesses of a variety of different communication strategies and the ability to execute them.
Discipline neutrality demands that everything starts with a granular understanding of the consumer how they live, what's important to them and how they engage with the category and the brand. The task, then, is to build a communications plan from that understanding with no preconceived ideas about the form that plan will take or the disciplines or channels that will be used.
Consider, for instance, an agency tasked with jump-starting the sales of a brand of canned soup. The conventional approach would involve creating a TV and print campaign that would, say, extol the benefits of soup as an aid to weight loss. The ads would run in daytime talk shows and women's lifestyle magazines.
The media-neutral approach would be to do the same thing but take it further by sponsoring a segment on "The Biggest Loser," seeding the campaign in weight-loss forums and encouraging bloggers to write about the soup.
The discipline-neutral approach would be to understand how people used the soup and what kind of relationship they had with the brand. It could turn out, for example, that the soup was generally consumed at lunchtime, but only by people with microwaves in their offices. In this case, the discipline-neutral approach could consist of designing a self-heating soup can and launching it with sampling programs at major commuting locations and in city delis.
That kind of approach is the only way brands will ever really be able to develop a relationship with consumers. It's the opposite of "telling and selling." It's understanding customers and finding ways to engage them in a relevant way with genuinely useful innovation. Who'd argue with that?
Paul Parton is the brand-planning partner at The Brooklyn Brothers, a creative collective.
Monday, May 14, 2007
Major Magazine Distributor Acquires Primedia Enthusiast Magazines
Major Magazine Distributor Acquires Primedia Enthusiast Magazines
by Tony Silber
http://foliomag.com/viewmedia.asp?prmMID=7715
Source Interlink Companies, one of the leading magazine distributors, announced today that it is acquiring Primedia Enthusiast Media (PEM) in a stock purchase for approximately $1.2 billion in cash.
A public company based in Bonita Springs, Florida, Source Interlink also distributes DVDs, music CDs, and books. It generated about $1.9 billion in its fiscal 2007, which ended January 31.
Source Interlink is controlled by Yucaipa Cos., a supermarket-holding company owned by billionaire businessman Ron Burkle. Last week, Folio: reported that insiders were saying the Burkle bid was coming on strong, although one source told Folio: the Burkle bid (mentioned to be in connection with American Media) was not being taken seriously. “It is a stunning development that a publicly owned distribution company controlled by Ron Burkle is buying one of the largest portfolios of enthusiast magazines,” one source said Monday morning. “It’s shocking. The valuation is significantly higher than they would have gotten from others.”
Indeed, Source Interlink also paid significantly more than sources in the last few weeks indicated the company might get. PEM, with revenue of about $524 million and EBITDA of about $100 million, turned out to command an EBITDA multiple of about 12-times.
To fund the acquisition, Source Interlink has secured a financing commitment from Citigroup Global Markets. It was unclear at presstime whether American Media was involved.
Source Interlink has been on a buying spree in recent years. In 2004, it acquired Empire News, and in 2005, it acquired Chas. Levy Circulating Co. for $30 million, giving it about 20 percent of the single-copy magazine-distribution market.
“Over the last several years Source has driven the consolidation of a fragmented and inefficient channel for the distribution and merchandising of home entertainment content at retail and the newsstand,” said Source Interlink chairman Michael Duckworth. “This acquisition is a first step to leverage what we have built by transforming Source into a fully integrated media company with both print and digital content. Primedia Enthusiast Media's industry-leading special interest magazine titles and consumer Web sites diversifies our earnings streams and accelerates our growth.”
Following the completion of the transaction, PEM will operate as a division of Source Interlink and will be headed by Steve Parr, PEM’s current president. He will report to Duckworth.
PEM is the leading special-interest magazine publisher in the U.S., with over 70 magazines. Its portfolio includes: Motor Trend, Automobile, Hot Rod, Lowrider, Soap Opera Digest and Soap Opera Weekly, Power & Motoryacht
by Tony Silber
http://foliomag.com/viewmedia.asp?prmMID=7715
Source Interlink Companies, one of the leading magazine distributors, announced today that it is acquiring Primedia Enthusiast Media (PEM) in a stock purchase for approximately $1.2 billion in cash.
A public company based in Bonita Springs, Florida, Source Interlink also distributes DVDs, music CDs, and books. It generated about $1.9 billion in its fiscal 2007, which ended January 31.
Source Interlink is controlled by Yucaipa Cos., a supermarket-holding company owned by billionaire businessman Ron Burkle. Last week, Folio: reported that insiders were saying the Burkle bid was coming on strong, although one source told Folio: the Burkle bid (mentioned to be in connection with American Media) was not being taken seriously. “It is a stunning development that a publicly owned distribution company controlled by Ron Burkle is buying one of the largest portfolios of enthusiast magazines,” one source said Monday morning. “It’s shocking. The valuation is significantly higher than they would have gotten from others.”
Indeed, Source Interlink also paid significantly more than sources in the last few weeks indicated the company might get. PEM, with revenue of about $524 million and EBITDA of about $100 million, turned out to command an EBITDA multiple of about 12-times.
To fund the acquisition, Source Interlink has secured a financing commitment from Citigroup Global Markets. It was unclear at presstime whether American Media was involved.
Source Interlink has been on a buying spree in recent years. In 2004, it acquired Empire News, and in 2005, it acquired Chas. Levy Circulating Co. for $30 million, giving it about 20 percent of the single-copy magazine-distribution market.
“Over the last several years Source has driven the consolidation of a fragmented and inefficient channel for the distribution and merchandising of home entertainment content at retail and the newsstand,” said Source Interlink chairman Michael Duckworth. “This acquisition is a first step to leverage what we have built by transforming Source into a fully integrated media company with both print and digital content. Primedia Enthusiast Media's industry-leading special interest magazine titles and consumer Web sites diversifies our earnings streams and accelerates our growth.”
Following the completion of the transaction, PEM will operate as a division of Source Interlink and will be headed by Steve Parr, PEM’s current president. He will report to Duckworth.
PEM is the leading special-interest magazine publisher in the U.S., with over 70 magazines. Its portfolio includes: Motor Trend, Automobile, Hot Rod, Lowrider, Soap Opera Digest and Soap Opera Weekly, Power & Motoryacht
Who says industry magazines are cozy with their advertisers?
A Nod to Journalistic Integrity Is Seen in an Editor’s Return
By DAVID S. JOACHIM
Who says industry magazines are cozy with their advertisers?
Last week, the International Data Group removed the chief executive of its largest-circulation computer magazine, PC World, and reinstated its top editor, who had quit days earlier over the executive’s decision to not run an article critical of an advertiser.
The editor in chief, Harry McCracken, rejoined the magazine on Wednesday after the disputed article, “10 Things We Hate About Apple,” was posted on the magazine’s Web site.
It was a hero’s homecoming for Mr. McCracken, who was praised on the PCWorld.com message boards and in the blogosphere for sacrificing himself in the name of journalistic integrity.
“I was on the brink of canceling my subscription,” wrote one reader. “Now that McCracken’s back, I’ll stick around, too.”
PC World, a monthly magazine with a companion Web site that mixes technology news with product reviews, has a reputation for smart and sometimes hard-hitting articles that often offend big tech companies.
In recent years, it has criticized several of its advertisers for what it described were bait-and-switch tactics and price gouging. Its survey of the reliability of manufacturers has given poor ratings to several of the magazine’s advertisers. It even has a regular column chronicling the defects in Microsoft software.
Mr. McCracken says that several advertisers have withdrawn ads over the years, after their products were negatively reviewed in the magazine, most recently last month. (He would not name the advertiser.)
“PC World is surprisingly reportorial, especially against some other technology magazines that don’t invest a lot” in articles that might provoke companies, said Sam Whitmore, an analyst in Beverly, Mass., who tracks technology publishers.
That may explain why Mr. McCracken’s resignation drew the attention of hundreds of bloggers. It became a cause célèbre for many who viewed the spiking of the article as an affront to Silicon Valley’s Fourth Estate. To others, it was a confirmation of what they had long suspected — that the business side routinely meddles in editorial decisions at technology magazines, especially in recent years, as ad pages have declined considerably, leaving many magazines to rely on only a handful of advertisers.
Mr. McCracken says he did not quit to make a statement. But now, a part of him is glad that the skirmish became public. “With the conclusion we reached, this should tell everyone that computer journalism isn’t sleazy,” he said.
Even so, on blogs and in interviews, some observers noted that the final version of the Apple article appeared next to another article titled, “10 Things We Love About Apple,” making them wonder whether a compromise had been made to appease Apple, and whether the “We Hate” article had been toned down before publication.
Mr. McCracken, a 12-year veteran of PC World, said that the dustup with his boss occurred while the “We Hate” article was still a draft, and that editing was done before it was published. He said, however, that it was edited without consideration to how Apple might react. He also said that the “We Love” article had been planned all along.
He acknowledged that the “We Hate” article made for an odd source of controversy, because it required little reporting and contained no news. “We saw it as a fun little story that would get people talking,” he said. Wired News called it a “fluffy piece of Digg bait” meant to compel user-driven news sites like Digg.com to link to it.
The ousted chief executive of PC World, Colin Crawford, has been reassigned to his old job of overseeing business development for International Data’s online properties. He did not respond to messages left at his office and on his cellphone.
Mr. Crawford, who had been at PC World for only two months, spent 10 years as chief executive of the company’s Macworld magazine, which is devoted to Apple’s line of Macintosh products. International Data also runs the Macworld convention, where the chief executive of Apple, Steven P. Jobs, introduced the iPhone in January.
Apple is “not just any advertiser,” Mr. Whitmore, the analyst, said, pointing out that Mr. Jobs had a reputation for trying to influence coverage of the company.
Apple did not return calls seeking comment. The writers of the Apple articles, Narasu Rebbapragada and Alan Stafford, declined to comment.
By DAVID S. JOACHIM
Who says industry magazines are cozy with their advertisers?
Last week, the International Data Group removed the chief executive of its largest-circulation computer magazine, PC World, and reinstated its top editor, who had quit days earlier over the executive’s decision to not run an article critical of an advertiser.
The editor in chief, Harry McCracken, rejoined the magazine on Wednesday after the disputed article, “10 Things We Hate About Apple,” was posted on the magazine’s Web site.
It was a hero’s homecoming for Mr. McCracken, who was praised on the PCWorld.com message boards and in the blogosphere for sacrificing himself in the name of journalistic integrity.
“I was on the brink of canceling my subscription,” wrote one reader. “Now that McCracken’s back, I’ll stick around, too.”
PC World, a monthly magazine with a companion Web site that mixes technology news with product reviews, has a reputation for smart and sometimes hard-hitting articles that often offend big tech companies.
In recent years, it has criticized several of its advertisers for what it described were bait-and-switch tactics and price gouging. Its survey of the reliability of manufacturers has given poor ratings to several of the magazine’s advertisers. It even has a regular column chronicling the defects in Microsoft software.
Mr. McCracken says that several advertisers have withdrawn ads over the years, after their products were negatively reviewed in the magazine, most recently last month. (He would not name the advertiser.)
“PC World is surprisingly reportorial, especially against some other technology magazines that don’t invest a lot” in articles that might provoke companies, said Sam Whitmore, an analyst in Beverly, Mass., who tracks technology publishers.
That may explain why Mr. McCracken’s resignation drew the attention of hundreds of bloggers. It became a cause célèbre for many who viewed the spiking of the article as an affront to Silicon Valley’s Fourth Estate. To others, it was a confirmation of what they had long suspected — that the business side routinely meddles in editorial decisions at technology magazines, especially in recent years, as ad pages have declined considerably, leaving many magazines to rely on only a handful of advertisers.
Mr. McCracken says he did not quit to make a statement. But now, a part of him is glad that the skirmish became public. “With the conclusion we reached, this should tell everyone that computer journalism isn’t sleazy,” he said.
Even so, on blogs and in interviews, some observers noted that the final version of the Apple article appeared next to another article titled, “10 Things We Love About Apple,” making them wonder whether a compromise had been made to appease Apple, and whether the “We Hate” article had been toned down before publication.
Mr. McCracken, a 12-year veteran of PC World, said that the dustup with his boss occurred while the “We Hate” article was still a draft, and that editing was done before it was published. He said, however, that it was edited without consideration to how Apple might react. He also said that the “We Love” article had been planned all along.
He acknowledged that the “We Hate” article made for an odd source of controversy, because it required little reporting and contained no news. “We saw it as a fun little story that would get people talking,” he said. Wired News called it a “fluffy piece of Digg bait” meant to compel user-driven news sites like Digg.com to link to it.
The ousted chief executive of PC World, Colin Crawford, has been reassigned to his old job of overseeing business development for International Data’s online properties. He did not respond to messages left at his office and on his cellphone.
Mr. Crawford, who had been at PC World for only two months, spent 10 years as chief executive of the company’s Macworld magazine, which is devoted to Apple’s line of Macintosh products. International Data also runs the Macworld convention, where the chief executive of Apple, Steven P. Jobs, introduced the iPhone in January.
Apple is “not just any advertiser,” Mr. Whitmore, the analyst, said, pointing out that Mr. Jobs had a reputation for trying to influence coverage of the company.
Apple did not return calls seeking comment. The writers of the Apple articles, Narasu Rebbapragada and Alan Stafford, declined to comment.
Mag Bag: Stuff Goes to the Kentucky Derby, Stack Takes a Different Tack
Mag Bag: Stuff Goes to the Kentucky Derby, Stack Takes a Different Tack
by Erik Sass, Monday, May 14, 2007 7:00 AM ET
http://publications.mediapost.com
Stuff Goes to the Kentucky Derby, Stack Takes a Different Tack
Magazines are getting into event marketing in a big way, using high-engagement activities to draw groups of readers together and form a sense of identity centered on the publications. One favorite high-interest theme, of course, is sports--from both the fan and participant perspectives. These two sides of the sporting world have rather different vibes, of course.
The fan side might best be described as "decadent and depraved," at least when you're talking about the Kentucky Derby. A party hosted by Stuff magazine figured prominently among the revels on Saturday when Street Sense won the Kentucky Derby--as well as the revels both before and after the event, a 30-second race at the center of a two-day bout of upper-class binge drinking. The magazine, whose publisher wants to head up-market, is tapping into a variety of upper-crust class signifiers, including establishing its own online concierge service and now the Kentucky Derby. The association with Hunter S. Thompson, a renowned drinker, probably doesn't hurt either.
The Stuff magazine party on the eve of the Derby, after the Derby's annual Barnstable Brown party, was hosted by cover babe Taryn Manning, with guests including Jermaine Dupri, Janet Jackson, Joey Fatone, and NSync's Chris Kirkpatrick. Queen Elizabeth II did not attend--perhaps unconvinced by the "high class" vibe of the event; nor was she seen at the competing Crown Royal Playboy Lounge party.
The Derby party is one of a raft of upper-crust initiatives from Stuff and fellow Dennis Publishing title Maxim, which in recent years have both sought to shed its decade-old moniker of "lad mags." With the implosion of that category confirmed by the demise of down-market competitor FHM, the magazines are trying to reposition themselves as vehicles for advertisers to reach affluent, employed young men, both married and single, with (slightly) more highbrow content and lifestyle advice. Maxim is opening a chain of steakhouses with Jeffrey Chodorow, and has teamed with Concord Wilshire Partners to build a 2,300-room Maxim-themed hotel and casino on a 9-acre plot on the famed Las Vegas strip.
Meanwhile, Stack--a magazine targeting high school athletes with training tips and celebrity profiles--is taking a rather different approach: it's hosting a series of events where ambitious high school athletes can meet hundreds of coaches and recruiters from the nation's best collegiate athletic programs. In addition to helping readers get a shot at the big time, the recruiting events fit with the publication's multimedia delivery strategy: video of the events will be posted on the site, which also features exclusive video of celebrity athletes. Users are also invited to post clips of their workout routines and "best of" moments.
Since its founding in 2005, Stack has grown from an initial circulation of about 300,000 to 400,000 this year. With advertisers like Nike, Gatorade, U.S. Marines, Adidas, Sony PlayStation and New Balance, the magazine has a cover price of $4.99, but is distributed free to high school students through partnerships with school athletic directors. Its "Elite Tour" for high school football players will visit five cities: Atlanta on May 13th, Miami on May 19th, New York City on May 20th, Dallas on May 26th, and Los Angeles on May 27th.
Meredith to Map Home Renovation Projects, Consumer Behavior
Meredith Corporation is launching a research effort to figure out what consumers need for home renovations, when and how much of it they need, and where they typically go to procure it. The new research program, called HomeSight, promises to open a new area of business for Meredith's already substantial custom marketing efforts. HomeSight is being launched in partnership with CNW Marketing/Research, a consumer research organization based in Portland, Oregon. CNW's robust database of 5 million households covers a spectrum of geographic locations, financial attributes, "lifestages," and various related demographic attributes. Meredith will begin presenting the data to major homeware manufacturers and makers of other products used in home renovations, focusing on specific areas like bathroom or kitchen projects over the next couple of months.
Vibe's Gertler Steps Down
Eric Gertler, CEO of Vibe Media, is stepping down after 10 months, leaving the Wicks Group looking for a new publisher. No reason for the move was given; in January of this year Vibe President Ari Horowitz also stepped down. The Wicks Group, which owns Vibe Media, is said to be looking for a replacement for Gertler.
Mansueto Names Tebeau Publisher of Inc. Magazine
John Tebeau has been named publisher of Inc. magazine, effective immediately, according to Mansueto Ventures, which publishes both Inc. and Fast Company magazine. Mansueto CEO John Koten remarked: Under John's leadership, several new advertisers appeared in Inc. in the first quarter of 2007, including Comcast, Ketel One Vodka, Nissan Altima, Northern Trust, BMW, Wachovia, American Chemistry Council and UPS. His drive and vision will be instrumental in leading our advertising sales team as we continue to expand the Inc. brand with new ventures and programs." Tebeau was hired in 2005 as national sales director.
by Erik Sass, Monday, May 14, 2007 7:00 AM ET
http://publications.mediapost.com
Stuff Goes to the Kentucky Derby, Stack Takes a Different Tack
Magazines are getting into event marketing in a big way, using high-engagement activities to draw groups of readers together and form a sense of identity centered on the publications. One favorite high-interest theme, of course, is sports--from both the fan and participant perspectives. These two sides of the sporting world have rather different vibes, of course.
The fan side might best be described as "decadent and depraved," at least when you're talking about the Kentucky Derby. A party hosted by Stuff magazine figured prominently among the revels on Saturday when Street Sense won the Kentucky Derby--as well as the revels both before and after the event, a 30-second race at the center of a two-day bout of upper-class binge drinking. The magazine, whose publisher wants to head up-market, is tapping into a variety of upper-crust class signifiers, including establishing its own online concierge service and now the Kentucky Derby. The association with Hunter S. Thompson, a renowned drinker, probably doesn't hurt either.
The Stuff magazine party on the eve of the Derby, after the Derby's annual Barnstable Brown party, was hosted by cover babe Taryn Manning, with guests including Jermaine Dupri, Janet Jackson, Joey Fatone, and NSync's Chris Kirkpatrick. Queen Elizabeth II did not attend--perhaps unconvinced by the "high class" vibe of the event; nor was she seen at the competing Crown Royal Playboy Lounge party.
The Derby party is one of a raft of upper-crust initiatives from Stuff and fellow Dennis Publishing title Maxim, which in recent years have both sought to shed its decade-old moniker of "lad mags." With the implosion of that category confirmed by the demise of down-market competitor FHM, the magazines are trying to reposition themselves as vehicles for advertisers to reach affluent, employed young men, both married and single, with (slightly) more highbrow content and lifestyle advice. Maxim is opening a chain of steakhouses with Jeffrey Chodorow, and has teamed with Concord Wilshire Partners to build a 2,300-room Maxim-themed hotel and casino on a 9-acre plot on the famed Las Vegas strip.
Meanwhile, Stack--a magazine targeting high school athletes with training tips and celebrity profiles--is taking a rather different approach: it's hosting a series of events where ambitious high school athletes can meet hundreds of coaches and recruiters from the nation's best collegiate athletic programs. In addition to helping readers get a shot at the big time, the recruiting events fit with the publication's multimedia delivery strategy: video of the events will be posted on the site, which also features exclusive video of celebrity athletes. Users are also invited to post clips of their workout routines and "best of" moments.
Since its founding in 2005, Stack has grown from an initial circulation of about 300,000 to 400,000 this year. With advertisers like Nike, Gatorade, U.S. Marines, Adidas, Sony PlayStation and New Balance, the magazine has a cover price of $4.99, but is distributed free to high school students through partnerships with school athletic directors. Its "Elite Tour" for high school football players will visit five cities: Atlanta on May 13th, Miami on May 19th, New York City on May 20th, Dallas on May 26th, and Los Angeles on May 27th.
Meredith to Map Home Renovation Projects, Consumer Behavior
Meredith Corporation is launching a research effort to figure out what consumers need for home renovations, when and how much of it they need, and where they typically go to procure it. The new research program, called HomeSight, promises to open a new area of business for Meredith's already substantial custom marketing efforts. HomeSight is being launched in partnership with CNW Marketing/Research, a consumer research organization based in Portland, Oregon. CNW's robust database of 5 million households covers a spectrum of geographic locations, financial attributes, "lifestages," and various related demographic attributes. Meredith will begin presenting the data to major homeware manufacturers and makers of other products used in home renovations, focusing on specific areas like bathroom or kitchen projects over the next couple of months.
Vibe's Gertler Steps Down
Eric Gertler, CEO of Vibe Media, is stepping down after 10 months, leaving the Wicks Group looking for a new publisher. No reason for the move was given; in January of this year Vibe President Ari Horowitz also stepped down. The Wicks Group, which owns Vibe Media, is said to be looking for a replacement for Gertler.
Mansueto Names Tebeau Publisher of Inc. Magazine
John Tebeau has been named publisher of Inc. magazine, effective immediately, according to Mansueto Ventures, which publishes both Inc. and Fast Company magazine. Mansueto CEO John Koten remarked: Under John's leadership, several new advertisers appeared in Inc. in the first quarter of 2007, including Comcast, Ketel One Vodka, Nissan Altima, Northern Trust, BMW, Wachovia, American Chemistry Council and UPS. His drive and vision will be instrumental in leading our advertising sales team as we continue to expand the Inc. brand with new ventures and programs." Tebeau was hired in 2005 as national sales director.
Affluent Regional Magazine Readership in 87 Markets
Affluent Regional Magazine Readership in 87 Markets
According to a new report by The Media Audit, Texas Monthly, which is read by more than two million adults across the state of Texas, reaches 38.7% of all adults in San Antonio who earn $75,000 or more in household income, making it the number one publication in reaching affluent households among The Media Audit's 87 measured markets.
And Austin came in second! The surveys, through March 2007, found that Texas Monthly in Austin ranked second in reaching affluent households (38.2% of affluent households read one or more of the past four issues). Affluent households are defined as those adults who earn $75,000 or more in household income. Next are:
Texas Monthly in Houston (33.5%)
Tucson Lifestyle (31.7%)
Boston Magazine (31.6%)
The conversion rate used by The Media Audit (the percent of total readers who are likely to read every issue) points to the loyalty or frequency of exposure of a media's audience. Among the affluent reading the Texas Monthly in San Antonio and the Tucson Lifestyle, more than three quarters of the total readers also read the past issue, suggesting that these publication's affluent readers are very likely to be exposed to every issue, concludes the report.
Bob Jordan, President of Houston-based International Demographics, Inc., comments, "The degree of audience loyalty for these City and Regional Magazines is significant when you compare them to other media such as radio or television..."
Rounding out the top ten publications reaching affluent households one or more times in the previous four issues are:
Pittsburgh Magazine (30.6% of affluent adults)
D Magazine in Dallas-Ft. Worth (30.4%)
Sacramento Magazine (29.5%)
Gulfshore Life in Ft. Myers-Naples (28.6%)
Milwaukee Magazine (28.3%)
According to a new report by The Media Audit, Texas Monthly, which is read by more than two million adults across the state of Texas, reaches 38.7% of all adults in San Antonio who earn $75,000 or more in household income, making it the number one publication in reaching affluent households among The Media Audit's 87 measured markets.
And Austin came in second! The surveys, through March 2007, found that Texas Monthly in Austin ranked second in reaching affluent households (38.2% of affluent households read one or more of the past four issues). Affluent households are defined as those adults who earn $75,000 or more in household income. Next are:
Texas Monthly in Houston (33.5%)
Tucson Lifestyle (31.7%)
Boston Magazine (31.6%)
The conversion rate used by The Media Audit (the percent of total readers who are likely to read every issue) points to the loyalty or frequency of exposure of a media's audience. Among the affluent reading the Texas Monthly in San Antonio and the Tucson Lifestyle, more than three quarters of the total readers also read the past issue, suggesting that these publication's affluent readers are very likely to be exposed to every issue, concludes the report.
Bob Jordan, President of Houston-based International Demographics, Inc., comments, "The degree of audience loyalty for these City and Regional Magazines is significant when you compare them to other media such as radio or television..."
Rounding out the top ten publications reaching affluent households one or more times in the previous four issues are:
Pittsburgh Magazine (30.6% of affluent adults)
D Magazine in Dallas-Ft. Worth (30.4%)
Sacramento Magazine (29.5%)
Gulfshore Life in Ft. Myers-Naples (28.6%)
Milwaukee Magazine (28.3%)
For Magazine Industry, Less may be More
For magazine industry, less may be more
Time magazine's move to shed subscribers aims to shore up the publication.
By Randy Dotinga
Correspondent of The Christian Science Monitor
These days, Time magazine may not have much time for its 2006 Person of the Year – you.
A few months ago, the venerable newsmagazine announced that it will cut the number of paying readers that it guarantees to advertisers from 4 million to 3.25 million. Publicly, at least, Time doesn't care if 750,000 subscribers throw all those pesky renewal notices in the trash.
On the other hand, Time is reaching out to its most loyal readers through a beefed-up website, a new arrival date on newsstands, and a stable of spotlighted writers who fill its pages with commentary instead of traditional news reporting.
Why the extreme makeover? While the magazine industry is doing well as a whole, Time and its rival newsweeklies are struggling to stay afloat. Gutted by staff cuts and suffering from sluggish circulation, they're trying to figure out how to avoid the grim future facing the newspaper industry.
Time's solution is to adopt the philosophy that's ruled the wider magazine industry for years: Don't try to please all readers all of the time. Instead, just make some readers happy most of the time.
"The trend in the whole magazine industry has been from the general to the special interest," says Shirrel Rhoades, a consultant and a former vice president at Reader's Digest. The result: hundreds of magazines geared toward miniature dollhouse aficionados, surfers, and owners of old houses.
While there have been some high-profile magazine failures in the last decade (including Talk, George, and, most recently, the movie magazine Premiere), the total circulation of American magazines rose to 370 million in 2006, the highest since 2000.
High-brow magazines like The New Yorker and The Economist are doing especially well, and there are some 200 more magazines about just three subjects – dogs, golf, and interior design – than there were just a decade ago.
But the circulation of the Big Three newsmagazines (Time, Newsweek, and U.S. News & World Report) was largely flat in 2006, reaching a combined audience of about 9 million. They've each lost readers over the past 20 years, despite the growth of the US population.
"The extent of their influence has declined," says journalism professor David Sumner, coordinator of the magazine program at Ball State University in Muncie, Ind. "News has become more of a commodity, and it's cheap and easy to find."
As a result, the newsmagazines "are trying to reinvent themselves to compete with all the free news available on the cable channels and online," Mr. Sumner says. "They're trying hard to provide more interpretation, insight, and context, as well as soft entertainment stuff."
But cost-cutting has hobbled the news magazines. According to the Project for Excellence in Journalism, Newsweek and Time cut their news bureaus from a combined total of 62 in 1983 to 37 in 2006. They've also drastically reduced their staffs over that time period, with Time going from 362 to 226 employees, and Newsweek falling from 348 to 165.
Advertising doesn't appear to be saving the day, financially. While statistics suggest advertising in magazines in 2006 reached its highest level in six years, the newsweeklies reported little growth in total ad dollars.
Among the Big Three, Time has been in the forefront of change with its redesign and the change in its publishing date from Monday to Friday, intended to allow the magazine to be more timely for a weekend audience. Time is also publishing more original content on the Internet and devoting extra space in the magazine to commentary.
Time declined to make any company officials available for interviews for this story, but an editor's note in the magazine said Time hoped its redesign would make it "more meaningful and more forward looking."
In perhaps its most drastic move, Time is hoping to persuade advertisers to consider its cumulative reach, including website readers and those who read someone else's copy of the print magazine.
Traditionally, advertisers focus on a magazine's paid circulation, but Time is reducing the number of paid readers it guarantees to advertisers by 19 percent. In 2005, TV Guide made a similar move by slashing its guaranteed circulation from 9 million to 3.2 million.
While it may seem counterintuitive, dumping paid readers can save magazines money by allowing them to reduce the amount they spend persuading fickle subscribers to renew. And advertisers may appreciate being able to reach a more select and loyal audience.
Newsweek, meanwhile, continues to publish on Mondays and offer a more traditional mix of stories. Writers still tie up stories with pithy conclusions, using what staffers have called the authoritative "voice of God."
Newsweek wants to report less and interpret more, says worldwide publisher Gregory Osberg. "In the past, you followed the news. Now we're getting out in front of it and providing analysis."
Along those lines, Newsweek's website may offer a more specific focus on topics like politics, technology, and healthcare, Mr. Osberg says.
As for the third-place newsweekly, U.S. News & World Report remains the most serious – or the stodgiest, depending on your point of view – of the Top 3. It continues to focus heavily on topics like international news, politics, and business. It gives scant attention to, say, Paris Hilton's latest shenanigans. In fact, an analysis of eight months of 2006 issues by the Project for Excellence in Journalism found that U.S. News allocated less than 1 percent of its pages to celebrity and entertainment news; Time and Newsweek devoted 11 to 12 times as much of their space to those topics.
In regard to the future of magazines as a whole, industry insiders will be closely following the success or failure of a glossy new monthly business magazine called Condé Nast Portfolio, which published its first issue in April.
"Portfolio is being held up as the last big example of whether an old-school print magazine launch can still make it," says Matthew Kinsman, managing editor of the industry journal Folio:. "Their fate will have a lot of impact on the rest of the magazine world."
Overall, there seems to be much less hand-wringing in the magazine industry compared with, say, the newspaper business. There's plenty of speculation that your local daily newspaper could vanish in 20 years or less, but no one is saying that People, Good Housekeeping, and National Geographic will go the way of Life and Look magazines.
People move from place to place and encounter different newspapers, but magazines remain longstanding parts of people's lives, says journalism professor Sumner. "People feel more of an emotional bond to magazines, particularly if they've been long-term subscribers," he says.
Then there's the simple pleasure of reading a long, fascinating story on the couch instead of in a desk chair, staring at a computer monitor. "The portability and convenience factor will ensure that print magazines will be around for a long time," Sumner predicts.
Time magazine's move to shed subscribers aims to shore up the publication.
By Randy Dotinga
Correspondent of The Christian Science Monitor
These days, Time magazine may not have much time for its 2006 Person of the Year – you.
A few months ago, the venerable newsmagazine announced that it will cut the number of paying readers that it guarantees to advertisers from 4 million to 3.25 million. Publicly, at least, Time doesn't care if 750,000 subscribers throw all those pesky renewal notices in the trash.
On the other hand, Time is reaching out to its most loyal readers through a beefed-up website, a new arrival date on newsstands, and a stable of spotlighted writers who fill its pages with commentary instead of traditional news reporting.
Why the extreme makeover? While the magazine industry is doing well as a whole, Time and its rival newsweeklies are struggling to stay afloat. Gutted by staff cuts and suffering from sluggish circulation, they're trying to figure out how to avoid the grim future facing the newspaper industry.
Time's solution is to adopt the philosophy that's ruled the wider magazine industry for years: Don't try to please all readers all of the time. Instead, just make some readers happy most of the time.
"The trend in the whole magazine industry has been from the general to the special interest," says Shirrel Rhoades, a consultant and a former vice president at Reader's Digest. The result: hundreds of magazines geared toward miniature dollhouse aficionados, surfers, and owners of old houses.
While there have been some high-profile magazine failures in the last decade (including Talk, George, and, most recently, the movie magazine Premiere), the total circulation of American magazines rose to 370 million in 2006, the highest since 2000.
High-brow magazines like The New Yorker and The Economist are doing especially well, and there are some 200 more magazines about just three subjects – dogs, golf, and interior design – than there were just a decade ago.
But the circulation of the Big Three newsmagazines (Time, Newsweek, and U.S. News & World Report) was largely flat in 2006, reaching a combined audience of about 9 million. They've each lost readers over the past 20 years, despite the growth of the US population.
"The extent of their influence has declined," says journalism professor David Sumner, coordinator of the magazine program at Ball State University in Muncie, Ind. "News has become more of a commodity, and it's cheap and easy to find."
As a result, the newsmagazines "are trying to reinvent themselves to compete with all the free news available on the cable channels and online," Mr. Sumner says. "They're trying hard to provide more interpretation, insight, and context, as well as soft entertainment stuff."
But cost-cutting has hobbled the news magazines. According to the Project for Excellence in Journalism, Newsweek and Time cut their news bureaus from a combined total of 62 in 1983 to 37 in 2006. They've also drastically reduced their staffs over that time period, with Time going from 362 to 226 employees, and Newsweek falling from 348 to 165.
Advertising doesn't appear to be saving the day, financially. While statistics suggest advertising in magazines in 2006 reached its highest level in six years, the newsweeklies reported little growth in total ad dollars.
Among the Big Three, Time has been in the forefront of change with its redesign and the change in its publishing date from Monday to Friday, intended to allow the magazine to be more timely for a weekend audience. Time is also publishing more original content on the Internet and devoting extra space in the magazine to commentary.
Time declined to make any company officials available for interviews for this story, but an editor's note in the magazine said Time hoped its redesign would make it "more meaningful and more forward looking."
In perhaps its most drastic move, Time is hoping to persuade advertisers to consider its cumulative reach, including website readers and those who read someone else's copy of the print magazine.
Traditionally, advertisers focus on a magazine's paid circulation, but Time is reducing the number of paid readers it guarantees to advertisers by 19 percent. In 2005, TV Guide made a similar move by slashing its guaranteed circulation from 9 million to 3.2 million.
While it may seem counterintuitive, dumping paid readers can save magazines money by allowing them to reduce the amount they spend persuading fickle subscribers to renew. And advertisers may appreciate being able to reach a more select and loyal audience.
Newsweek, meanwhile, continues to publish on Mondays and offer a more traditional mix of stories. Writers still tie up stories with pithy conclusions, using what staffers have called the authoritative "voice of God."
Newsweek wants to report less and interpret more, says worldwide publisher Gregory Osberg. "In the past, you followed the news. Now we're getting out in front of it and providing analysis."
Along those lines, Newsweek's website may offer a more specific focus on topics like politics, technology, and healthcare, Mr. Osberg says.
As for the third-place newsweekly, U.S. News & World Report remains the most serious – or the stodgiest, depending on your point of view – of the Top 3. It continues to focus heavily on topics like international news, politics, and business. It gives scant attention to, say, Paris Hilton's latest shenanigans. In fact, an analysis of eight months of 2006 issues by the Project for Excellence in Journalism found that U.S. News allocated less than 1 percent of its pages to celebrity and entertainment news; Time and Newsweek devoted 11 to 12 times as much of their space to those topics.
In regard to the future of magazines as a whole, industry insiders will be closely following the success or failure of a glossy new monthly business magazine called Condé Nast Portfolio, which published its first issue in April.
"Portfolio is being held up as the last big example of whether an old-school print magazine launch can still make it," says Matthew Kinsman, managing editor of the industry journal Folio:. "Their fate will have a lot of impact on the rest of the magazine world."
Overall, there seems to be much less hand-wringing in the magazine industry compared with, say, the newspaper business. There's plenty of speculation that your local daily newspaper could vanish in 20 years or less, but no one is saying that People, Good Housekeeping, and National Geographic will go the way of Life and Look magazines.
People move from place to place and encounter different newspapers, but magazines remain longstanding parts of people's lives, says journalism professor Sumner. "People feel more of an emotional bond to magazines, particularly if they've been long-term subscribers," he says.
Then there's the simple pleasure of reading a long, fascinating story on the couch instead of in a desk chair, staring at a computer monitor. "The portability and convenience factor will ensure that print magazines will be around for a long time," Sumner predicts.
'Paper dumping' hotline planned
'Paper dumping' hotline planned
Mark Sweney
MediaGuardian.co.uk
Ditched: copies of the London Paper and London Lite in a bin. Photo: Christian Sinibaldi
Londoners fed up with seeing dumped copies of London Lite and the London Paper around the capital may soon have an outlet for their frustration, with plans afoot for a complaints line people can call to report alleged dumping.
A complaints line is one of four proposals the Audit Bureau of Circulations, the body that audits newspaper sales, is considering as it seeks to stamp out dumping of the two London freesheets.
The ABC said its investigation of alleged dumping had found evidence that copies of London Lite, published by Associated Newspapers, and the News International-owned London Paper are being ditched.
As a result ABC is asking the publishers of both freesheets to adhere to a tighter code of conduct, including giving "consideration" to setting up a dumping complaints phone line for members of the public to report offences.
"The review has identified that copies of newspapers are being dumped which is, obviously, not compliant with the ABC rules," the organisation said.
ABC added that it was, however, "satisfied" that the reported circulation figures for April are "materially compliant".
"Having identified the distinct risk associated with hand distribution, ABC, in conjunction with publishers, has been working on improving the publisher management controls still further," the organisation added.
"ABC will be requiring additional improvements to the management control and reporting of the distribution."
The body's four-point plan to stamp out freesheet dumping in London also includes increased focus on internal publisher controls, compliance checking and complaints handling.
ABC is proposing more regular spot checks within London Lite and the London Paper distribution areas to monitor the effectiveness of publishers' compliance procedures and an ongoing review of hand distribution and ABC certification by industry representatives.
The circulation body launched the review following tit-for-tat allegations made last month by News International and Associated Newspapers - including the latter's release of video and photographic evidence that distributors were dumping free papers.
ABC said the review was instigated despite the fact that neither publisher made a formal complaint.
Mark Sweney
MediaGuardian.co.uk
Ditched: copies of the London Paper and London Lite in a bin. Photo: Christian Sinibaldi
Londoners fed up with seeing dumped copies of London Lite and the London Paper around the capital may soon have an outlet for their frustration, with plans afoot for a complaints line people can call to report alleged dumping.
A complaints line is one of four proposals the Audit Bureau of Circulations, the body that audits newspaper sales, is considering as it seeks to stamp out dumping of the two London freesheets.
The ABC said its investigation of alleged dumping had found evidence that copies of London Lite, published by Associated Newspapers, and the News International-owned London Paper are being ditched.
As a result ABC is asking the publishers of both freesheets to adhere to a tighter code of conduct, including giving "consideration" to setting up a dumping complaints phone line for members of the public to report offences.
"The review has identified that copies of newspapers are being dumped which is, obviously, not compliant with the ABC rules," the organisation said.
ABC added that it was, however, "satisfied" that the reported circulation figures for April are "materially compliant".
"Having identified the distinct risk associated with hand distribution, ABC, in conjunction with publishers, has been working on improving the publisher management controls still further," the organisation added.
"ABC will be requiring additional improvements to the management control and reporting of the distribution."
The body's four-point plan to stamp out freesheet dumping in London also includes increased focus on internal publisher controls, compliance checking and complaints handling.
ABC is proposing more regular spot checks within London Lite and the London Paper distribution areas to monitor the effectiveness of publishers' compliance procedures and an ongoing review of hand distribution and ABC certification by industry representatives.
The circulation body launched the review following tit-for-tat allegations made last month by News International and Associated Newspapers - including the latter's release of video and photographic evidence that distributors were dumping free papers.
ABC said the review was instigated despite the fact that neither publisher made a formal complaint.
Sunday, May 13, 2007
Murdoch, like Hearst, yearns to tell the world how to think
Citizen Murdoch reaches out
Mogul wants to be man on the Street
http://www.variety.com/article/VR1117964733.html?categoryId=1&cs=1
Rupert Murdoch, a man who has a penchant for buying, is out there doing some selling. Specifically, he's selling the Bancroft family on the idea that he's not William Randolph Hearst.
The Bancrofts are the New England Brahmins who control Dow Jones & Co., and the Wall Street Journal, a media empire that Murdoch covets. He covets it to the tune of a lofty $5 billion bid.
Murdoch has always salivated for the Journal because it's rich, conservative and could be an elegant companion piece to his long-planned Fox Business Channel. But the Bancrofts, who control 64% of the company's voting shares, are resisting Murdoch's entreaties.
They don't explain why (Brahmins never do), but clearly they feel a certain responsibility -- noblesse oblige -- for the health and autonomy of their paper. At the same time, they distrust Murdoch, the media baron, as being, well Hearstian.
Which to some extent is understandable. Murdoch, as he gets older (he's just turned 76), increasingly displays some fascinating ambiguities. Unlike Hearst, his business acumen continues to sharpen with age. But like Hearst, he yearns to tell citizens of the world how to think and what to believe, and like Hearst, his views grow ever more polarizing. Witness his zealous support for a president with a 28% approval rating, according to the recent Newsweek poll.
There are other Hearstian reminders as well. Murdoch, like Hearst, feels drawn to Hollywood. Though he's never built a castle, Murdoch, like Hearst, entertains grandly at his various mansions (and yachts). Like Hearst, Murdoch also loves newspapers, not only for their economic heft but also for their ideological clout.
Hearst didn't hesitate advocating war when it served his purposes, and in his later years seemed drawn more to Hitler than to Roosevelt. He worshipped power for the sake of power.
Murdoch represents himself as a libertarian but is fiercely pro-Bush, pro-Iraq War and pro everything Republican. While many of his newspapers stay above the fray, the Murdochian world view is vividly on display at the New York Post and Fox News. At the recent Milken Conference in Los Angeles, Murdoch vented his opinions before an enclave of business CEOs, as though reminding fellow power players that he understands not only how to build a media empire but also how to run the world.
Given all this, Murdoch's appetite could stir problems on the political front. A cross-ownership waiver obtained by Murdoch will expire next year -- News Corp. needs the waiver because it owns two TV stations in New York as well as the Post. Democrats in Congress could also try to bar Murdoch's acquisition by redefining the Wall Street Journal as a local rather than national newspaper, thus making him more vulnerable to cross-ownership constraints.
To be sure, Murdoch has gone out of his way to stress that he will not impose ideology on the Wall Street Journal, a dubious commitment since the newspaper's editorial pages already proclaim that the Bush Era is golden. The news pages of the Journal, on the other hand, have remained remarkably "pure" -- that is, free of ideological taint. Some of its reporters, nonetheless, are nervous about whether things would stay that way.
Peter Kann, the paper's long-term executive editor and later chairman, dispatched a letter last week praising the Bancroft family for upholding the Journal's independence, while James H. Ottaway, Jr., a former Dow Jones executive and major shareholder, saw fit to remind his confreres that Murdoch's control would imperil the Journal's "news quality and integrity."
As a corporate leader, to be sure, Murdoch has some important achievements to "sell." Just about the entire business community applauds his dealmaking prowess -- witness MySpace. His senior management team at Fox also is vastly admired. Peter Chernin provides brilliant leadership and Tom Rothman and Jim Gianopulos have run the studio with a consistency that's the envy of the rest of Hollywood. Roger Ailes, too, has brought a pizzazz to network news that's left CNN in the dust. Only the Fox Network has failed to build a durable management.
As a result of all this, the media community seems a bit dazzled by the Rupe offensive. The Economist, while criticizing Murdoch for taking the Times of London "downmarket," nonetheless has instructed the Bancrofts to accept his offer. The Economist's parent, Pearson, might regret this recommendation -- Murdoch could emerge as a more important competitor of the Financial Times, which also is part of Pearson.
Writing in the New York Times, Andrew Ross Sorkin also recommends that the Bancrofts give the nod to Murdoch. Having been granted an exclusive and persuasive interview last week, Sorkin concluded the media baron would be "the perfect publisher for the Wall Street Journal."
Sorkin also notes that Murdoch's longtime banker, Goldman Sachs, suddenly is representing Dow Jones, with which it has never had a relationship. John Thornton, a former Goldman president, also is a member of Rupert's board of directors.
In his declining years, William Randolph Hearst found the world to be increasingly disinterested in his power and distrustful of his world view. One senses that, whatever the surface similarities, Rupert Murdoch has no intention of replicating that scenario.
The big question: Will Rupert be defeated by his own appetites? And, more specifically, does the world want to be told what to think by a media mogul whose ideas, like Hearst's, grow ever more doctrinaire?
Mogul wants to be man on the Street
http://www.variety.com/article/VR1117964733.html?categoryId=1&cs=1
Rupert Murdoch, a man who has a penchant for buying, is out there doing some selling. Specifically, he's selling the Bancroft family on the idea that he's not William Randolph Hearst.
The Bancrofts are the New England Brahmins who control Dow Jones & Co., and the Wall Street Journal, a media empire that Murdoch covets. He covets it to the tune of a lofty $5 billion bid.
Murdoch has always salivated for the Journal because it's rich, conservative and could be an elegant companion piece to his long-planned Fox Business Channel. But the Bancrofts, who control 64% of the company's voting shares, are resisting Murdoch's entreaties.
They don't explain why (Brahmins never do), but clearly they feel a certain responsibility -- noblesse oblige -- for the health and autonomy of their paper. At the same time, they distrust Murdoch, the media baron, as being, well Hearstian.
Which to some extent is understandable. Murdoch, as he gets older (he's just turned 76), increasingly displays some fascinating ambiguities. Unlike Hearst, his business acumen continues to sharpen with age. But like Hearst, he yearns to tell citizens of the world how to think and what to believe, and like Hearst, his views grow ever more polarizing. Witness his zealous support for a president with a 28% approval rating, according to the recent Newsweek poll.
There are other Hearstian reminders as well. Murdoch, like Hearst, feels drawn to Hollywood. Though he's never built a castle, Murdoch, like Hearst, entertains grandly at his various mansions (and yachts). Like Hearst, Murdoch also loves newspapers, not only for their economic heft but also for their ideological clout.
Hearst didn't hesitate advocating war when it served his purposes, and in his later years seemed drawn more to Hitler than to Roosevelt. He worshipped power for the sake of power.
Murdoch represents himself as a libertarian but is fiercely pro-Bush, pro-Iraq War and pro everything Republican. While many of his newspapers stay above the fray, the Murdochian world view is vividly on display at the New York Post and Fox News. At the recent Milken Conference in Los Angeles, Murdoch vented his opinions before an enclave of business CEOs, as though reminding fellow power players that he understands not only how to build a media empire but also how to run the world.
Given all this, Murdoch's appetite could stir problems on the political front. A cross-ownership waiver obtained by Murdoch will expire next year -- News Corp. needs the waiver because it owns two TV stations in New York as well as the Post. Democrats in Congress could also try to bar Murdoch's acquisition by redefining the Wall Street Journal as a local rather than national newspaper, thus making him more vulnerable to cross-ownership constraints.
To be sure, Murdoch has gone out of his way to stress that he will not impose ideology on the Wall Street Journal, a dubious commitment since the newspaper's editorial pages already proclaim that the Bush Era is golden. The news pages of the Journal, on the other hand, have remained remarkably "pure" -- that is, free of ideological taint. Some of its reporters, nonetheless, are nervous about whether things would stay that way.
Peter Kann, the paper's long-term executive editor and later chairman, dispatched a letter last week praising the Bancroft family for upholding the Journal's independence, while James H. Ottaway, Jr., a former Dow Jones executive and major shareholder, saw fit to remind his confreres that Murdoch's control would imperil the Journal's "news quality and integrity."
As a corporate leader, to be sure, Murdoch has some important achievements to "sell." Just about the entire business community applauds his dealmaking prowess -- witness MySpace. His senior management team at Fox also is vastly admired. Peter Chernin provides brilliant leadership and Tom Rothman and Jim Gianopulos have run the studio with a consistency that's the envy of the rest of Hollywood. Roger Ailes, too, has brought a pizzazz to network news that's left CNN in the dust. Only the Fox Network has failed to build a durable management.
As a result of all this, the media community seems a bit dazzled by the Rupe offensive. The Economist, while criticizing Murdoch for taking the Times of London "downmarket," nonetheless has instructed the Bancrofts to accept his offer. The Economist's parent, Pearson, might regret this recommendation -- Murdoch could emerge as a more important competitor of the Financial Times, which also is part of Pearson.
Writing in the New York Times, Andrew Ross Sorkin also recommends that the Bancrofts give the nod to Murdoch. Having been granted an exclusive and persuasive interview last week, Sorkin concluded the media baron would be "the perfect publisher for the Wall Street Journal."
Sorkin also notes that Murdoch's longtime banker, Goldman Sachs, suddenly is representing Dow Jones, with which it has never had a relationship. John Thornton, a former Goldman president, also is a member of Rupert's board of directors.
In his declining years, William Randolph Hearst found the world to be increasingly disinterested in his power and distrustful of his world view. One senses that, whatever the surface similarities, Rupert Murdoch has no intention of replicating that scenario.
The big question: Will Rupert be defeated by his own appetites? And, more specifically, does the world want to be told what to think by a media mogul whose ideas, like Hearst's, grow ever more doctrinaire?
Tilting at a Digital Future
Tilting at a Digital Future
By RICHARD SIKLOS
http://www.nytimes.com/2007/05/13/business/yourmoney/13murdoch.html?_r=1&adxnnl=1&oref=slogin&ref=media&adxnnlx=1179063530-uHy2sFBfx8U+keUkWB6YgQ
IN Rupert Murdoch’s world, two things are certain: the sun never sets on the kingdom, and a TV is always on in the background.
On the evening of April 26, several large television monitors adorned the terrace of Mr. Murdoch’s Beverly Hills mansion for a dinner celebrating a special edition of “American Idol” that raised more than $70 million to fight poverty. An Asian noodle station was set out by the pool; nearby, sushi chefs busily sliced tuna for “Idol” co-hosts Simon Cowell and Ryan Seacrest, and seven, hyperactive “Idol” finalists who, when they weren’t clamoring around megastar Tom Cruise, dreamily watched themselves on the big screens. Wendi Deng, Mr. Murdoch’s wife, wore a billowy, green dress and introduced their 5-year-old daughter, Grace, to guests before sending her to bed.
Mr. Murdoch casually sipped wine and chatted with his daughter, Elisabeth, and other guests. He had planned for the event to be an early dinner party, but he finally headed to bed at 1 a.m., leaving music impresario Quincy Jones and others chatting on a sofa. After all, he had work to do.
What partygoers didn’t know was that during the previous week, on April 17, Mr. Murdoch had offered to buy Dow Jones & Company, the venerable publisher of The Wall Street Journal, for $5 billion. So far, he had not heard back directly from the Bancrofts, the family that controls Dow Jones. Signals sent by the Bancrofts’ intermediaries were not encouraging, but he was prepared to fly cross-country and meet with the family on a moment’s notice.
As is so often the case with Mr. Murdoch, the Dow Jones bid is counterintuitive and seemingly quixotic. While investors and media giants have cooled on the newspaper industry, the News Corporation’s czar has patiently waited for the right moment to bid on a prize he has long coveted but felt was beyond his reach. Mr. Murdoch’s bid has also caused hand-wringing about his intentions for The Journal, a publication that has long led the pack in authoritative business coverage.
Perhaps the chief worry among those concerned about the journalistic future of Dow Jones is how much editorial independence the company would have under Mr. Murdoch’s rule. It also raised questions about how well the strait-laced Journal would fit within a conglomerate whose offerings include the online hangout MySpace, racy British tabloids, and table-thumpers like Bill O’Reilly.
WHATEVER the media mogul says he may do with such a powerful enterprise, a close look at what he’s actually done in the past — particularly how he has deployed his far larger Hollywood and television properties — is a telling indicator of what life may be like for Dow Jones in a Murdoch regime.
When Mr. Murdoch bought the struggling 20th Century Fox studio in 1985, Hollywood viewed him as just the latest arriviste, doomed to be suckered by the industry’s vagaries. Yet Mr. Murdoch restored the studio, let his staff there produce the films they wanted (for the most part), and used Fox as a springboard to start his Fox television network and a passel of cable channels and other ventures around the globe.
“Rupert Murdoch is utterly consistent,” says Barry Diller, who once ran Fox and now oversees the IAC/Interactive Corporation. “It’s not like he’s adding toys. This is oxygen to him.”
In almost every case, Mr. Murdoch endured years of losses to put new offerings like Sky Television in England the Fox News Channel in America on the map. There is scant evidence of Mr. Murdoch’s envelope-pushing imprimatur at the studio that is the center of it all, just as it is less in evidence at the large quality newspapers he owns, including The Times of London and The Australian.
Mr. Murdoch’s long-held desire to own The Journal fits into a similar grand plan: to revitalize if not save the original business — newspapers — on which he built his empire. Mr. Murdoch’s vision is to fold together the far-flung news businesses he owns into a seamless digital platform anchored by the Web-oriented Journal and, in the process, reinvent the newspaper industry that his company was built on. “We are a relatively old company deeply rooted in print journalism,” Mr. Murdoch told his top news executives in his Aussie drawl a few days after the “Idol” party. “Now, we have to make huge leap into a completely different world.”
The digital future he envisions has information zipping across an expanding, ubiquitous array of screens — TVs, laptops and cellphones. In a world of proliferating broadband, Mr. Murdoch sees video as a bigger component of the news blur and he wants to meld his disparate video assets into his sprawling digital infrastructure: from Fox News in the United States, Sky News outlets around the world, and the business TV channel he is launching this fall in America and plans to take international (which, if his cards play out, he hopes to tie closely to The Journal).
As Mr. Murdoch tries to make the digital future a reality, skeptics wonder whether he will use his newfangled media platform to merely transmit news and analysis or whether he will package information according to his own needs — and even use it as a cudgel.
A couple of days embedded in the Murdoch camp yields a few clues about what makes Rupert run and why. At age 76, he appears to be in his strongest position in years — with his company’s share price up nearly 50 percent in the past two years and his grip over his company finally secure. He remains unblinkingly fixated on the advancement of the News Corporation as though it were a nation state and his relentless corporate march has imbued his company with a maverick culture less apparent at other media giants scrambling to adapt to the hurly-burly of the digital age.
Mr. Murdoch has also shown little hesitation to reverse course when his plans go awry. He says that China, for instance, is no longer the corporate imperative that it once was for him. Until recently, he was determined to build a global satellite-TV empire to delivery his programming, but the rapid emergence of the Internet cooled his ardor. DirecTV, was a company he pursued for years with as much fervor as he now shows for Dow Jones, but he recently agreed to sell it only three years after it was acquired. While the News Corporation’s involvement in the newspaper business could seem like nostalgic attachment to an industry that has seen better days, Mr. Murdoch is hardly known for being sentimental. Indeed, Mr. Murdoch is pretty much the same in public as he is in private, with little evidence of an inner Rupert — even to some who work closely with him.
“This is a man who’s been single-minded since he was 22 years old and he’s woken up every morning with the same agenda: which is to extend the reach and power and influence of his company,” said one person close to Mr. Murdoch who was given anonymity to speak openly about him. “I think tomorrow is the same as today in that respect.”
Mr. Murdoch has had an eventful personal life — including six children from three marriages — and his raw ambition dovetails with an endless curiosity about world affairs, a mischievous streak, and a self-image as the ultimate outsider. In fact, Mr. Murdoch says he is most energized when he is taking on “the elites” — words he practically sneers when he says them — in what he perceives as a career-long battle to offer consumers more media choices. (The Journal, of course, represents one of the quintessential elite media trophies).
Asked if even now he doesn’t consider himself an elite, Mr. Murdoch shakes his head. “No, I’m going to keep myself as much of an outsider as possible,” he says. “We just don’t join clubs.”
MR. MURDOCH’S many critics over the years have viewed him in a far less noble light, accusing him of a cynical worldview that appeals to the lowest common denominator. In sum, they say, he is willing to sacrifice principle for profit.
“His business is privatized, government propaganda; that’s all the company essentially does,” says Bruce Page, a journalist who worked at The Sunday Times of London before Mr. Murdoch owned it and is among his toughest critics. Mr. Page’s 2003 book, “The Murdoch Archipelago,” portrayed Mr. Murdoch as nothing less than a threat to democracy. “It isn’t that Murdoch’s particularly wicked. He’s not a fearsome, warriorlike figure. He’s Falstaff. He has absolutely no concept of honor.”
James H. Ottaway Jr., whose family owns 6 percent of Dow Jones, sounded a similar, if more measured, alarm in a statement on May 6 opposing the offer. “When Rupert Murdoch’s news interests conflict, his business interests usually prevail,” Mr. Ottaway wrote.
This is far from how Mr. Murdoch sees himself, although he has acknowledged that “it has been a long career, and I’m not going to say that it hasn’t been punctuated by mistakes.” He also argues that he has evolved as a newspaper owner and does not interfere in coverage or dictate editorial positions at his quality titles.
There are certainly well-worn stories about how he dropped BBC from his Chinese satellite service to appease the government, published the so-called Hitler Diaries in his Sunday Times, and pummeled foes in the pages of The New York Post. But his proponents say that there are the less-told stories about how he once owned The Village Voice and New York magazine and left their editorial operations largely alone.
Asked what he would tell the Bancrofts if they granted him a meeting, Mr. Murdoch says, “I want to tell them how much I appreciate them as a family and to impress on them that my family would be a worthy successor.”
Mr. Murdoch half-jokingly says that he is too busy to roll up his shirtsleeves and write headlines; after all, he has 47,000 employees. He has also offered to install an independent board at The Journal to ensure independence, something he did at The Times. But he has also made it clear that he is not offering a 67 percent premium over Dow Jones’ share price to stay away from the place — and that he vows to invest in the business. In the British market, for example, he has spent nearly $1 billion on new presses, converted the venerable Times to a tabloid format while expanding its foreign bureaus, and started a free daily — all in the past few years.
Although Mr. Murdoch is a huge fan of The Journal’s conservative editorial pages, which are routinely aligned with the political tenor of the Fox News Channel, he insists that most of his editors pick for themselves which candidates they support in elections. In England, it is not unusual for The Sunday Times and The Times of London to support different candidates; same for his big tabloids The Sun and News of the World. (In this political season, Mr. Murdoch says that personally, he is keeping his options open; among the American presidential candidates, “I’m not madly enthusiastic for anyone,” he says.)
Without his cherished newspapers, Mr. Murdoch would be just another billionaire spouting about politics and world affairs and occasionally chairing fund-raisers — not playing as defining a role in shaping public opinion and packaging information. But print isn’t, at first blush, where the action is in the Murdoch kingdom.
From the sprawling Fox studio lot in Century City and the twinkling lights of the Los Angeles splayed out beneath his terrace, newspapers seem like a quaint and distant quadrant of the empire, contributing just 15 percent of the company’s $21.3 billion in revenue in the nine months ended March 31, 2007, and 14 percent of its $3.2 billion in operating income. Like most newspaper companies, the newspaper group is facing slow revenue growth, and its operating margins are running at a solid, if unspectacular, 14 percent.
Over his usual lunch of whitefish and spinach at the Fox commissary three days before CNBC first reported his bid for Dow Jones, Mr. Murdoch boasted that the “underlying readership of newspapers is going through the roof.” Yet he had notably sat on the sidelines as two of America’s largest newspaper groups, Knight-Ridder and Tribune Company, went up for sale and failed to attract more than a single bidder. Had the industry become so impaired that he would never buy another newspaper again?
“It’s all possible,” he said, with an earnest smile. “Never say never.”
In the days after he submitted his bid for Dow Jones, Mr. Murdoch says that he had started to think his offer was going to be quietly rejected. But the Bancrofts authorized the family’s trustee to hire bankers and lawyers to represent them — an encouraging sign. Then, word leaked out through CNBC, to the chagrin of Mr. Murdoch and his advisers, who worried that if it became public the family may close ranks.
Mr. Murdoch was back in New York when the news broke and went on the Fox News Channel to talk about his offer. While he was in the studio, the Bancrofts issued a statement that family members representing 52 percent of the votes in Dow Jones opposed the offer. Mr. Murdoch said that he held out hope — which he says he still maintains — for a meeting with the family.
Three days after his Fox News appearance on May 3, Mr. Murdoch still had not received any direct word from the Bancrofts. He sat on a sofa in his office on the eighth floor of the News Corporation’s Manhattan headquarters, behind him a wall of TV screens showing his channels, set next to a luminescent blue and yellow map of the world. (There is also a rack for his newspapers, flown in daily).
He said that he believed some of the 35 Bancroft family members may be swayed to take his offer, and then did something he rarely does: talk about the past. He spoke of his father’s beginnings in Australian newspapers, and how he rescued papers that, he said, would have otherwise disappeared. “There’s a pattern that goes right up to today, of providing choice.”
Later that same day, he boarded the company jet for a flight to Monterey, Calif. For the third year in a row, he was gathering his top publishing and digital executives from here and abroad to brainstorm about how to go about conquering the Internet. By the time the jet was over Michigan, several News Corporation executives were playing poker in the back of the plane. Col Allan, the editor of The New York Post, watched the Republican debate on a big television screen and Robert Thomson, editor of The Times of London, phoned his newsroom to get the results of the French election.
Mr. Murdoch had planned to view some TV pilots, but never got around to it as he, Mr. Thomson and his executive vice president of corporate affairs, Gary Ginsberg, sat in his study and talked into the night about politics and world affairs. At one point, Mr. Murdoch, wearing a beige cardigan, glanced at a screen tuned to his news channel.
“Fair and balanced,” he declared, repeating the Fox News motto, which he meant as a playful jab at Mr. Ginsberg, who worked in the Clinton administration.
THE next morning, Mr. Murdoch was joined by Peter A. Chernin, the News Corporation president, to kick off the “Digital News Initiative” conference at the Monterey Plaza Hotel. The 60 or so attendees ran the gamut of his company’s news operations, including teams from not only his British and Australian papers and The Post, but also from Sky Television in London, the Fox television group and MySpace.
There was urgency in the room, because the company’s online media outlets do not have the same kind of dominance they enjoy in TV and in print. For instance, both FoxNews.com and NYPost.com saw the number of unique users to their sites rise around 30 percent in April versus a year earlier, but they still ranked only 9th and 26th among the most visited general news sites, according to ComScore Networks.
Guest speakers included Mark Zuckerberg, the 22-year-old founder of Facebook, Meg Whitman, the chief executive of eBay, and Kjell Aamot, the chief executive of Schibsted, the Norwegian publisher that generates a majority of its earnings from its online operations. Mr. Murdoch was staying at his ranch in nearby Carmel, where he had a dinner for the group.
Critical to reinventing the newspaper business, Mr. Murdoch told the audience, is getting the 175 newspapers the company owns to share resources and move quickly in unison. “We need to take advantage of our global scale everywhere,” he said.
Although Mr. Murdoch had not expected to discuss his offer for Dow Jones at the meeting, he offered a brief explanation. “We had hoped to keep it private and secret for a lot longer while they were having proper time to consider it,” he said. “I think it’s an incredible franchise with outstanding people.”
The challenges facing Dow Jones are somewhat different then those facing Mr. Murdoch’s papers because financial news is one of the few forms of information that consumers will pay for online. Still, The Journal, like other newspapers, has struggled to find ways to grow as print advertising and readership has come under pressure.
Jeremy Philips, a 34-year-old former Internet executive who joined the company last year to oversee strategy and acquisitions, followed Mr. Murdoch with a presentation that brought the challenges and opportunities facing the newspaper industry into sharp focus.
Online news is typically free, and advertising rates for it are comparatively low. Mr. Philips calculated that for every print reader a newspaper loses, it currently needs 100 online readers to generate the same amount of revenue. The more encouraging news is the costs of reaching those readers are less expensive through the Internet than through print — indeed, The Times of London, which recently revamped its Web site, is regularly visited by more users outside of England than within.
Another slide posited that of the millions of readers who come to various newspaper sites in a given month, a huge majority come only once, a consequence of all those referrals from search engines and aggregators. Mr. Philips said he sees that traffic, despite how fleeting it may be, as an incredible opportunity if all those one-time visitors can be compelled to come back a few times more.
Mr. Murdoch perked up when discussing the online potential of The New York Post, which has consistently lost money since he acquired it for a second time in 1993. At a break in the conference, Mr. Murdoch sought out Rebecca Wade, the editor of The Sun, to discuss the results of that day’s Scottish election. For a while, he sat at the back of the ballroom chatting with Mr. Zuckerberg of Facebook, who sat next to him again at dinner. Mr. Murdoch listened closely.
If one thing was clear over the weekend, it was that Mr. Murdoch’s determination to revitalize the news will depend as much on mastering geeky technology as storytelling and layout. Winning The Journal will require other masterful feats like convincing the Bancrofts that the sometimes fractious Murdoch clan will be worthy stewards.
Mr. Murdoch says that if the Bancrofts grant him a meeting, he would like to introduce them to his grown children so they can see the passion they all share for the news business.
Of course, Mr. Murdoch does not exactly see himself as a wizened septuagenarian preparing to hand off his media assets. His wife, Wendi, is 38 years his junior, and they have socialized with the Google co-founder Sergey Brin and his fiancée, Anne Wojcicki. The Murdochs are planning to move into a $44 million penthouse on Fifth Avenue next year. It is the most expensive apartment in New York and was once owned by Laurence Rockefeller; it is another prize that Mr. Murdoch has said he has long coveted.
By every measure, he appears to believe he has plenty of time to get exactly what he wants. As he wrapped up the conference in Monterey last Sunday, he looked out at his employees and said: “You all think I’m too old.” Pausing for a beat, he added: “I think you’re too old.”
By RICHARD SIKLOS
http://www.nytimes.com/2007/05/13/business/yourmoney/13murdoch.html?_r=1&adxnnl=1&oref=slogin&ref=media&adxnnlx=1179063530-uHy2sFBfx8U+keUkWB6YgQ
IN Rupert Murdoch’s world, two things are certain: the sun never sets on the kingdom, and a TV is always on in the background.
On the evening of April 26, several large television monitors adorned the terrace of Mr. Murdoch’s Beverly Hills mansion for a dinner celebrating a special edition of “American Idol” that raised more than $70 million to fight poverty. An Asian noodle station was set out by the pool; nearby, sushi chefs busily sliced tuna for “Idol” co-hosts Simon Cowell and Ryan Seacrest, and seven, hyperactive “Idol” finalists who, when they weren’t clamoring around megastar Tom Cruise, dreamily watched themselves on the big screens. Wendi Deng, Mr. Murdoch’s wife, wore a billowy, green dress and introduced their 5-year-old daughter, Grace, to guests before sending her to bed.
Mr. Murdoch casually sipped wine and chatted with his daughter, Elisabeth, and other guests. He had planned for the event to be an early dinner party, but he finally headed to bed at 1 a.m., leaving music impresario Quincy Jones and others chatting on a sofa. After all, he had work to do.
What partygoers didn’t know was that during the previous week, on April 17, Mr. Murdoch had offered to buy Dow Jones & Company, the venerable publisher of The Wall Street Journal, for $5 billion. So far, he had not heard back directly from the Bancrofts, the family that controls Dow Jones. Signals sent by the Bancrofts’ intermediaries were not encouraging, but he was prepared to fly cross-country and meet with the family on a moment’s notice.
As is so often the case with Mr. Murdoch, the Dow Jones bid is counterintuitive and seemingly quixotic. While investors and media giants have cooled on the newspaper industry, the News Corporation’s czar has patiently waited for the right moment to bid on a prize he has long coveted but felt was beyond his reach. Mr. Murdoch’s bid has also caused hand-wringing about his intentions for The Journal, a publication that has long led the pack in authoritative business coverage.
Perhaps the chief worry among those concerned about the journalistic future of Dow Jones is how much editorial independence the company would have under Mr. Murdoch’s rule. It also raised questions about how well the strait-laced Journal would fit within a conglomerate whose offerings include the online hangout MySpace, racy British tabloids, and table-thumpers like Bill O’Reilly.
WHATEVER the media mogul says he may do with such a powerful enterprise, a close look at what he’s actually done in the past — particularly how he has deployed his far larger Hollywood and television properties — is a telling indicator of what life may be like for Dow Jones in a Murdoch regime.
When Mr. Murdoch bought the struggling 20th Century Fox studio in 1985, Hollywood viewed him as just the latest arriviste, doomed to be suckered by the industry’s vagaries. Yet Mr. Murdoch restored the studio, let his staff there produce the films they wanted (for the most part), and used Fox as a springboard to start his Fox television network and a passel of cable channels and other ventures around the globe.
“Rupert Murdoch is utterly consistent,” says Barry Diller, who once ran Fox and now oversees the IAC/Interactive Corporation. “It’s not like he’s adding toys. This is oxygen to him.”
In almost every case, Mr. Murdoch endured years of losses to put new offerings like Sky Television in England the Fox News Channel in America on the map. There is scant evidence of Mr. Murdoch’s envelope-pushing imprimatur at the studio that is the center of it all, just as it is less in evidence at the large quality newspapers he owns, including The Times of London and The Australian.
Mr. Murdoch’s long-held desire to own The Journal fits into a similar grand plan: to revitalize if not save the original business — newspapers — on which he built his empire. Mr. Murdoch’s vision is to fold together the far-flung news businesses he owns into a seamless digital platform anchored by the Web-oriented Journal and, in the process, reinvent the newspaper industry that his company was built on. “We are a relatively old company deeply rooted in print journalism,” Mr. Murdoch told his top news executives in his Aussie drawl a few days after the “Idol” party. “Now, we have to make huge leap into a completely different world.”
The digital future he envisions has information zipping across an expanding, ubiquitous array of screens — TVs, laptops and cellphones. In a world of proliferating broadband, Mr. Murdoch sees video as a bigger component of the news blur and he wants to meld his disparate video assets into his sprawling digital infrastructure: from Fox News in the United States, Sky News outlets around the world, and the business TV channel he is launching this fall in America and plans to take international (which, if his cards play out, he hopes to tie closely to The Journal).
As Mr. Murdoch tries to make the digital future a reality, skeptics wonder whether he will use his newfangled media platform to merely transmit news and analysis or whether he will package information according to his own needs — and even use it as a cudgel.
A couple of days embedded in the Murdoch camp yields a few clues about what makes Rupert run and why. At age 76, he appears to be in his strongest position in years — with his company’s share price up nearly 50 percent in the past two years and his grip over his company finally secure. He remains unblinkingly fixated on the advancement of the News Corporation as though it were a nation state and his relentless corporate march has imbued his company with a maverick culture less apparent at other media giants scrambling to adapt to the hurly-burly of the digital age.
Mr. Murdoch has also shown little hesitation to reverse course when his plans go awry. He says that China, for instance, is no longer the corporate imperative that it once was for him. Until recently, he was determined to build a global satellite-TV empire to delivery his programming, but the rapid emergence of the Internet cooled his ardor. DirecTV, was a company he pursued for years with as much fervor as he now shows for Dow Jones, but he recently agreed to sell it only three years after it was acquired. While the News Corporation’s involvement in the newspaper business could seem like nostalgic attachment to an industry that has seen better days, Mr. Murdoch is hardly known for being sentimental. Indeed, Mr. Murdoch is pretty much the same in public as he is in private, with little evidence of an inner Rupert — even to some who work closely with him.
“This is a man who’s been single-minded since he was 22 years old and he’s woken up every morning with the same agenda: which is to extend the reach and power and influence of his company,” said one person close to Mr. Murdoch who was given anonymity to speak openly about him. “I think tomorrow is the same as today in that respect.”
Mr. Murdoch has had an eventful personal life — including six children from three marriages — and his raw ambition dovetails with an endless curiosity about world affairs, a mischievous streak, and a self-image as the ultimate outsider. In fact, Mr. Murdoch says he is most energized when he is taking on “the elites” — words he practically sneers when he says them — in what he perceives as a career-long battle to offer consumers more media choices. (The Journal, of course, represents one of the quintessential elite media trophies).
Asked if even now he doesn’t consider himself an elite, Mr. Murdoch shakes his head. “No, I’m going to keep myself as much of an outsider as possible,” he says. “We just don’t join clubs.”
MR. MURDOCH’S many critics over the years have viewed him in a far less noble light, accusing him of a cynical worldview that appeals to the lowest common denominator. In sum, they say, he is willing to sacrifice principle for profit.
“His business is privatized, government propaganda; that’s all the company essentially does,” says Bruce Page, a journalist who worked at The Sunday Times of London before Mr. Murdoch owned it and is among his toughest critics. Mr. Page’s 2003 book, “The Murdoch Archipelago,” portrayed Mr. Murdoch as nothing less than a threat to democracy. “It isn’t that Murdoch’s particularly wicked. He’s not a fearsome, warriorlike figure. He’s Falstaff. He has absolutely no concept of honor.”
James H. Ottaway Jr., whose family owns 6 percent of Dow Jones, sounded a similar, if more measured, alarm in a statement on May 6 opposing the offer. “When Rupert Murdoch’s news interests conflict, his business interests usually prevail,” Mr. Ottaway wrote.
This is far from how Mr. Murdoch sees himself, although he has acknowledged that “it has been a long career, and I’m not going to say that it hasn’t been punctuated by mistakes.” He also argues that he has evolved as a newspaper owner and does not interfere in coverage or dictate editorial positions at his quality titles.
There are certainly well-worn stories about how he dropped BBC from his Chinese satellite service to appease the government, published the so-called Hitler Diaries in his Sunday Times, and pummeled foes in the pages of The New York Post. But his proponents say that there are the less-told stories about how he once owned The Village Voice and New York magazine and left their editorial operations largely alone.
Asked what he would tell the Bancrofts if they granted him a meeting, Mr. Murdoch says, “I want to tell them how much I appreciate them as a family and to impress on them that my family would be a worthy successor.”
Mr. Murdoch half-jokingly says that he is too busy to roll up his shirtsleeves and write headlines; after all, he has 47,000 employees. He has also offered to install an independent board at The Journal to ensure independence, something he did at The Times. But he has also made it clear that he is not offering a 67 percent premium over Dow Jones’ share price to stay away from the place — and that he vows to invest in the business. In the British market, for example, he has spent nearly $1 billion on new presses, converted the venerable Times to a tabloid format while expanding its foreign bureaus, and started a free daily — all in the past few years.
Although Mr. Murdoch is a huge fan of The Journal’s conservative editorial pages, which are routinely aligned with the political tenor of the Fox News Channel, he insists that most of his editors pick for themselves which candidates they support in elections. In England, it is not unusual for The Sunday Times and The Times of London to support different candidates; same for his big tabloids The Sun and News of the World. (In this political season, Mr. Murdoch says that personally, he is keeping his options open; among the American presidential candidates, “I’m not madly enthusiastic for anyone,” he says.)
Without his cherished newspapers, Mr. Murdoch would be just another billionaire spouting about politics and world affairs and occasionally chairing fund-raisers — not playing as defining a role in shaping public opinion and packaging information. But print isn’t, at first blush, where the action is in the Murdoch kingdom.
From the sprawling Fox studio lot in Century City and the twinkling lights of the Los Angeles splayed out beneath his terrace, newspapers seem like a quaint and distant quadrant of the empire, contributing just 15 percent of the company’s $21.3 billion in revenue in the nine months ended March 31, 2007, and 14 percent of its $3.2 billion in operating income. Like most newspaper companies, the newspaper group is facing slow revenue growth, and its operating margins are running at a solid, if unspectacular, 14 percent.
Over his usual lunch of whitefish and spinach at the Fox commissary three days before CNBC first reported his bid for Dow Jones, Mr. Murdoch boasted that the “underlying readership of newspapers is going through the roof.” Yet he had notably sat on the sidelines as two of America’s largest newspaper groups, Knight-Ridder and Tribune Company, went up for sale and failed to attract more than a single bidder. Had the industry become so impaired that he would never buy another newspaper again?
“It’s all possible,” he said, with an earnest smile. “Never say never.”
In the days after he submitted his bid for Dow Jones, Mr. Murdoch says that he had started to think his offer was going to be quietly rejected. But the Bancrofts authorized the family’s trustee to hire bankers and lawyers to represent them — an encouraging sign. Then, word leaked out through CNBC, to the chagrin of Mr. Murdoch and his advisers, who worried that if it became public the family may close ranks.
Mr. Murdoch was back in New York when the news broke and went on the Fox News Channel to talk about his offer. While he was in the studio, the Bancrofts issued a statement that family members representing 52 percent of the votes in Dow Jones opposed the offer. Mr. Murdoch said that he held out hope — which he says he still maintains — for a meeting with the family.
Three days after his Fox News appearance on May 3, Mr. Murdoch still had not received any direct word from the Bancrofts. He sat on a sofa in his office on the eighth floor of the News Corporation’s Manhattan headquarters, behind him a wall of TV screens showing his channels, set next to a luminescent blue and yellow map of the world. (There is also a rack for his newspapers, flown in daily).
He said that he believed some of the 35 Bancroft family members may be swayed to take his offer, and then did something he rarely does: talk about the past. He spoke of his father’s beginnings in Australian newspapers, and how he rescued papers that, he said, would have otherwise disappeared. “There’s a pattern that goes right up to today, of providing choice.”
Later that same day, he boarded the company jet for a flight to Monterey, Calif. For the third year in a row, he was gathering his top publishing and digital executives from here and abroad to brainstorm about how to go about conquering the Internet. By the time the jet was over Michigan, several News Corporation executives were playing poker in the back of the plane. Col Allan, the editor of The New York Post, watched the Republican debate on a big television screen and Robert Thomson, editor of The Times of London, phoned his newsroom to get the results of the French election.
Mr. Murdoch had planned to view some TV pilots, but never got around to it as he, Mr. Thomson and his executive vice president of corporate affairs, Gary Ginsberg, sat in his study and talked into the night about politics and world affairs. At one point, Mr. Murdoch, wearing a beige cardigan, glanced at a screen tuned to his news channel.
“Fair and balanced,” he declared, repeating the Fox News motto, which he meant as a playful jab at Mr. Ginsberg, who worked in the Clinton administration.
THE next morning, Mr. Murdoch was joined by Peter A. Chernin, the News Corporation president, to kick off the “Digital News Initiative” conference at the Monterey Plaza Hotel. The 60 or so attendees ran the gamut of his company’s news operations, including teams from not only his British and Australian papers and The Post, but also from Sky Television in London, the Fox television group and MySpace.
There was urgency in the room, because the company’s online media outlets do not have the same kind of dominance they enjoy in TV and in print. For instance, both FoxNews.com and NYPost.com saw the number of unique users to their sites rise around 30 percent in April versus a year earlier, but they still ranked only 9th and 26th among the most visited general news sites, according to ComScore Networks.
Guest speakers included Mark Zuckerberg, the 22-year-old founder of Facebook, Meg Whitman, the chief executive of eBay, and Kjell Aamot, the chief executive of Schibsted, the Norwegian publisher that generates a majority of its earnings from its online operations. Mr. Murdoch was staying at his ranch in nearby Carmel, where he had a dinner for the group.
Critical to reinventing the newspaper business, Mr. Murdoch told the audience, is getting the 175 newspapers the company owns to share resources and move quickly in unison. “We need to take advantage of our global scale everywhere,” he said.
Although Mr. Murdoch had not expected to discuss his offer for Dow Jones at the meeting, he offered a brief explanation. “We had hoped to keep it private and secret for a lot longer while they were having proper time to consider it,” he said. “I think it’s an incredible franchise with outstanding people.”
The challenges facing Dow Jones are somewhat different then those facing Mr. Murdoch’s papers because financial news is one of the few forms of information that consumers will pay for online. Still, The Journal, like other newspapers, has struggled to find ways to grow as print advertising and readership has come under pressure.
Jeremy Philips, a 34-year-old former Internet executive who joined the company last year to oversee strategy and acquisitions, followed Mr. Murdoch with a presentation that brought the challenges and opportunities facing the newspaper industry into sharp focus.
Online news is typically free, and advertising rates for it are comparatively low. Mr. Philips calculated that for every print reader a newspaper loses, it currently needs 100 online readers to generate the same amount of revenue. The more encouraging news is the costs of reaching those readers are less expensive through the Internet than through print — indeed, The Times of London, which recently revamped its Web site, is regularly visited by more users outside of England than within.
Another slide posited that of the millions of readers who come to various newspaper sites in a given month, a huge majority come only once, a consequence of all those referrals from search engines and aggregators. Mr. Philips said he sees that traffic, despite how fleeting it may be, as an incredible opportunity if all those one-time visitors can be compelled to come back a few times more.
Mr. Murdoch perked up when discussing the online potential of The New York Post, which has consistently lost money since he acquired it for a second time in 1993. At a break in the conference, Mr. Murdoch sought out Rebecca Wade, the editor of The Sun, to discuss the results of that day’s Scottish election. For a while, he sat at the back of the ballroom chatting with Mr. Zuckerberg of Facebook, who sat next to him again at dinner. Mr. Murdoch listened closely.
If one thing was clear over the weekend, it was that Mr. Murdoch’s determination to revitalize the news will depend as much on mastering geeky technology as storytelling and layout. Winning The Journal will require other masterful feats like convincing the Bancrofts that the sometimes fractious Murdoch clan will be worthy stewards.
Mr. Murdoch says that if the Bancrofts grant him a meeting, he would like to introduce them to his grown children so they can see the passion they all share for the news business.
Of course, Mr. Murdoch does not exactly see himself as a wizened septuagenarian preparing to hand off his media assets. His wife, Wendi, is 38 years his junior, and they have socialized with the Google co-founder Sergey Brin and his fiancée, Anne Wojcicki. The Murdochs are planning to move into a $44 million penthouse on Fifth Avenue next year. It is the most expensive apartment in New York and was once owned by Laurence Rockefeller; it is another prize that Mr. Murdoch has said he has long coveted.
By every measure, he appears to believe he has plenty of time to get exactly what he wants. As he wrapped up the conference in Monterey last Sunday, he looked out at his employees and said: “You all think I’m too old.” Pausing for a beat, he added: “I think you’re too old.”
Saturday, May 12, 2007
All-out outsourcing
All-out outsourcing
Alan Mutter
http://newsosaur.blogspot.com/
Struggling to sustain their traditional profitability amid weakening sales, newspaper publishers are looking to outsource everything from composing ads and printing papers to producing content and answering the phones.
After nipping and tucking headcount in newsrooms over the last few years, publishers appear to be poised to eliminate a significantly greater number of jobs in their plants by focusing on areas that previously were immune to cutbacks.
The initiative likely to claim the largest number of positions in the near future is the outsourcing of advertising composition to places like India and other low-wage countries.
In light of the apparent success of a pilot ad-outsource program at the Media News Group properties in Northern California, publishers like Gannett, McClatchy, the New York Times Co. and Scripps are considering whether they, too, should export such duties to offshore vendors, according to insiders familiar with the discussions.
These talks may or may not result in a decision to outsource jobs at any given property. But, human costs aside, the economics are powerfully persuasive.
Newspapers sending ad production offshore typically can reduce payroll costs by some 45%, says Robert Berkeley, president of Express KCS, one of the outsourcing companies. Thus, a paper could cut its costs to $30,000 a year per outsourced worker from $55,000 for an American doing the same job. These savings are even higher in unionized metro environments, where papers are struggling the hardest to sustain their margins.
The Columbus (OH) Dispatch was among the first to shift ad production to India, eliminating 90 jobs from a paper with daily circulation of 231,355. Assuming savings of $25k per employee, the paper should be able to add roughly $2.25 million a year to its bottom line.
Putting it another way: If a paper paid each departing employee a generous half-year of severance, the outsourcing project would begin to pay for itself in little more than 12 months – a terrific return on investment.
In what may be a harbinger of future initiatives elsewhere in the country, the San Francisco Chronicle has signed a 15-year contract with a Canadian company to begin printing the paper in in a new plant being constructed by early 2009. The opening coincides with the termination of the contract covering the newspaper’s 230 unionized press operators. When the new plant opens, their jobs will be gone.
While not outsourcing their production altogether, companies like the New York Times, Gannett, Media News and Journal Register have consolidated the printing and mailroom operations among certain of their geographically contiguous properties. In New Jersey, 200 production positions were eliminated when Advance Publications opened a plant to combine the production of the Newark Star Ledger and the Trenton Times.
While outsourcing production is complicated and not always feasible, the easiest jobs to shift are those of the people who work in telephone rooms or perform accounting, billing, accounts payable, human resources and other clerical functions.
Many newspaper groups already funnel want-ad and circulation calls to regional or national centers, where a single group of workers serving multiple time zones is far more efficient than a team dedicated to a single market. Many chains also have either consolidated clerical functions at in-house service bureaus or outsourced them to domestic vendors.
Sending call-center and clerical work offshore can shave 25% to 30% off the present costs of such operations, according to Gartner Research, a private firm. The New York Times and Boston Globe, among others, are each sending 40 to 50 clerical jobs to offshore contactors.
Even editorial and online operations are not immune from outsourcing.
Knight Ridder had a plan to create regional copy desks to handle headlines and layouts for groups of newspapers, a concept that was shelved prior to the sale of the company last year. Preposterous as the idea might sound, this is exactly what is being implemented in New Zealand by the publisher of the country’s largest daily and several other publications.
APN News and Media, a division of Britain’s Independent News & Media, is outsourcing about 70 jobs to an Australian company, according to Deutsche Presse-Agentur. If it works well, Independent News may extend the program to its titles in England and Ireland.
Reuters has more than 300 journalists in India writing many of the routine stories on its financial wires, according to MediaGuardian. Reuters has said it may increase the size of the Indian staff to 1,500 writers, though this could be affected by the potential merger with Thomson Corp.
And today's Los Angeles Times reports that a hyper-local website in Pasadena (not affiliated with a newspaper) has hired two writers in India, who, among other things, will cover city council meetings via webcam.
As valuable as Internet operations are to the future of newspaper companies, some publishers are having at least a portion of the work done overseas. London’s Financial Times, for example, relies on a staff in the Philippines to help edit and maintain its web site.
With offshore development, testing, hosting and technical support common in the information-technology sector, it is only logical that newspapers could achieve additional economies by moving – or expanding – many of these functions abroad.
When everything from designing buildings to analyzing X-rays can be performed by lower-paid professionals in another part of the world, there’s no reason to believe newspapers can avoid the workforce shake-ups that have jolted most other industries.
Institutional inertia and economic self-satisfaction have maintained the status quo until now. As an increasingly challenging business environment forces newspapers out of their comfort zones, many dedicated workers, unfortunately, will be forced out of theirs, too.
Alan Mutter
http://newsosaur.blogspot.com/
Struggling to sustain their traditional profitability amid weakening sales, newspaper publishers are looking to outsource everything from composing ads and printing papers to producing content and answering the phones.
After nipping and tucking headcount in newsrooms over the last few years, publishers appear to be poised to eliminate a significantly greater number of jobs in their plants by focusing on areas that previously were immune to cutbacks.
The initiative likely to claim the largest number of positions in the near future is the outsourcing of advertising composition to places like India and other low-wage countries.
In light of the apparent success of a pilot ad-outsource program at the Media News Group properties in Northern California, publishers like Gannett, McClatchy, the New York Times Co. and Scripps are considering whether they, too, should export such duties to offshore vendors, according to insiders familiar with the discussions.
These talks may or may not result in a decision to outsource jobs at any given property. But, human costs aside, the economics are powerfully persuasive.
Newspapers sending ad production offshore typically can reduce payroll costs by some 45%, says Robert Berkeley, president of Express KCS, one of the outsourcing companies. Thus, a paper could cut its costs to $30,000 a year per outsourced worker from $55,000 for an American doing the same job. These savings are even higher in unionized metro environments, where papers are struggling the hardest to sustain their margins.
The Columbus (OH) Dispatch was among the first to shift ad production to India, eliminating 90 jobs from a paper with daily circulation of 231,355. Assuming savings of $25k per employee, the paper should be able to add roughly $2.25 million a year to its bottom line.
Putting it another way: If a paper paid each departing employee a generous half-year of severance, the outsourcing project would begin to pay for itself in little more than 12 months – a terrific return on investment.
In what may be a harbinger of future initiatives elsewhere in the country, the San Francisco Chronicle has signed a 15-year contract with a Canadian company to begin printing the paper in in a new plant being constructed by early 2009. The opening coincides with the termination of the contract covering the newspaper’s 230 unionized press operators. When the new plant opens, their jobs will be gone.
While not outsourcing their production altogether, companies like the New York Times, Gannett, Media News and Journal Register have consolidated the printing and mailroom operations among certain of their geographically contiguous properties. In New Jersey, 200 production positions were eliminated when Advance Publications opened a plant to combine the production of the Newark Star Ledger and the Trenton Times.
While outsourcing production is complicated and not always feasible, the easiest jobs to shift are those of the people who work in telephone rooms or perform accounting, billing, accounts payable, human resources and other clerical functions.
Many newspaper groups already funnel want-ad and circulation calls to regional or national centers, where a single group of workers serving multiple time zones is far more efficient than a team dedicated to a single market. Many chains also have either consolidated clerical functions at in-house service bureaus or outsourced them to domestic vendors.
Sending call-center and clerical work offshore can shave 25% to 30% off the present costs of such operations, according to Gartner Research, a private firm. The New York Times and Boston Globe, among others, are each sending 40 to 50 clerical jobs to offshore contactors.
Even editorial and online operations are not immune from outsourcing.
Knight Ridder had a plan to create regional copy desks to handle headlines and layouts for groups of newspapers, a concept that was shelved prior to the sale of the company last year. Preposterous as the idea might sound, this is exactly what is being implemented in New Zealand by the publisher of the country’s largest daily and several other publications.
APN News and Media, a division of Britain’s Independent News & Media, is outsourcing about 70 jobs to an Australian company, according to Deutsche Presse-Agentur. If it works well, Independent News may extend the program to its titles in England and Ireland.
Reuters has more than 300 journalists in India writing many of the routine stories on its financial wires, according to MediaGuardian. Reuters has said it may increase the size of the Indian staff to 1,500 writers, though this could be affected by the potential merger with Thomson Corp.
And today's Los Angeles Times reports that a hyper-local website in Pasadena (not affiliated with a newspaper) has hired two writers in India, who, among other things, will cover city council meetings via webcam.
As valuable as Internet operations are to the future of newspaper companies, some publishers are having at least a portion of the work done overseas. London’s Financial Times, for example, relies on a staff in the Philippines to help edit and maintain its web site.
With offshore development, testing, hosting and technical support common in the information-technology sector, it is only logical that newspapers could achieve additional economies by moving – or expanding – many of these functions abroad.
When everything from designing buildings to analyzing X-rays can be performed by lower-paid professionals in another part of the world, there’s no reason to believe newspapers can avoid the workforce shake-ups that have jolted most other industries.
Institutional inertia and economic self-satisfaction have maintained the status quo until now. As an increasingly challenging business environment forces newspapers out of their comfort zones, many dedicated workers, unfortunately, will be forced out of theirs, too.
All-out outsourcing
All-out outsourcing
Alan Mutter
http://newsosaur.blogspot.com/
Struggling to sustain their traditional profitability amid weakening sales, newspaper publishers are looking to outsource everything from composing ads and printing papers to producing content and answering the phones.
After nipping and tucking headcount in newsrooms over the last few years, publishers appear to be poised to eliminate a significantly greater number of jobs in their plants by focusing on areas that previously were immune to cutbacks.
The initiative likely to claim the largest number of positions in the near future is the outsourcing of advertising composition to places like India and other low-wage countries.
In light of the apparent success of a pilot ad-outsource program at the Media News Group properties in Northern California, publishers like Gannett, McClatchy, the New York Times Co. and Scripps are considering whether they, too, should export such duties to offshore vendors, according to insiders familiar with the discussions.
These talks may or may not result in a decision to outsource jobs at any given property. But, human costs aside, the economics are powerfully persuasive.
Newspapers sending ad production offshore typically can reduce payroll costs by some 45%, says Robert Berkeley, president of Express KCS, one of the outsourcing companies. Thus, a paper could cut its costs to $30,000 a year per outsourced worker from $55,000 for an American doing the same job. These savings are even higher in unionized metro environments, where papers are struggling the hardest to sustain their margins.
The Columbus (OH) Dispatch was among the first to shift ad production to India, eliminating 90 jobs from a paper with daily circulation of 231,355. Assuming savings of $25k per employee, the paper should be able to add roughly $2.25 million a year to its bottom line.
Putting it another way: If a paper paid each departing employee a generous half-year of severance, the outsourcing project would begin to pay for itself in little more than 12 months – a terrific return on investment.
In what may be a harbinger of future initiatives elsewhere in the country, the San Francisco Chronicle has signed a 15-year contract with a Canadian company to begin printing the paper in in a new plant being constructed by early 2009. The opening coincides with the termination of the contract covering the newspaper’s 230 unionized press operators. When the new plant opens, their jobs will be gone.
While not outsourcing their production altogether, companies like the New York Times, Gannett, Media News and Journal Register have consolidated the printing and mailroom operations among certain of their geographically contiguous properties. In New Jersey, 200 production positions were eliminated when Advance Publications opened a plant to combine the production of the Newark Star Ledger and the Trenton Times.
While outsourcing production is complicated and not always feasible, the easiest jobs to shift are those of the people who work in telephone rooms or perform accounting, billing, accounts payable, human resources and other clerical functions.
Many newspaper groups already funnel want-ad and circulation calls to regional or national centers, where a single group of workers serving multiple time zones is far more efficient than a team dedicated to a single market. Many chains also have either consolidated clerical functions at in-house service bureaus or outsourced them to domestic vendors.
Sending call-center and clerical work offshore can shave 25% to 30% off the present costs of such operations, according to Gartner Research, a private firm. The New York Times and Boston Globe, among others, are each sending 40 to 50 clerical jobs to offshore contactors.
Even editorial and online operations are not immune from outsourcing.
Knight Ridder had a plan to create regional copy desks to handle headlines and layouts for groups of newspapers, a concept that was shelved prior to the sale of the company last year. Preposterous as the idea might sound, this is exactly what is being implemented in New Zealand by the publisher of the country’s largest daily and several other publications.
APN News and Media, a division of Britain’s Independent News & Media, is outsourcing about 70 jobs to an Australian company, according to Deutsche Presse-Agentur. If it works well, Independent News may extend the program to its titles in England and Ireland.
Reuters has more than 300 journalists in India writing many of the routine stories on its financial wires, according to MediaGuardian. Reuters has said it may increase the size of the Indian staff to 1,500 writers, though this could be affected by the potential merger with Thomson Corp.
And today's Los Angeles Times reports that a hyper-local website in Pasadena (not affiliated with a newspaper) has hired two writers in India, who, among other things, will cover city council meetings via webcam.
As valuable as Internet operations are to the future of newspaper companies, some publishers are having at least a portion of the work done overseas. London’s Financial Times, for example, relies on a staff in the Philippines to help edit and maintain its web site.
With offshore development, testing, hosting and technical support common in the information-technology sector, it is only logical that newspapers could achieve additional economies by moving – or expanding – many of these functions abroad.
When everything from designing buildings to analyzing X-rays can be performed by lower-paid professionals in another part of the world, there’s no reason to believe newspapers can avoid the workforce shake-ups that have jolted most other industries.
Institutional inertia and economic self-satisfaction have maintained the status quo until now. As an increasingly challenging business environment forces newspapers out of their comfort zones, many dedicated workers, unfortunately, will be forced out of theirs, too.
Alan Mutter
http://newsosaur.blogspot.com/
Struggling to sustain their traditional profitability amid weakening sales, newspaper publishers are looking to outsource everything from composing ads and printing papers to producing content and answering the phones.
After nipping and tucking headcount in newsrooms over the last few years, publishers appear to be poised to eliminate a significantly greater number of jobs in their plants by focusing on areas that previously were immune to cutbacks.
The initiative likely to claim the largest number of positions in the near future is the outsourcing of advertising composition to places like India and other low-wage countries.
In light of the apparent success of a pilot ad-outsource program at the Media News Group properties in Northern California, publishers like Gannett, McClatchy, the New York Times Co. and Scripps are considering whether they, too, should export such duties to offshore vendors, according to insiders familiar with the discussions.
These talks may or may not result in a decision to outsource jobs at any given property. But, human costs aside, the economics are powerfully persuasive.
Newspapers sending ad production offshore typically can reduce payroll costs by some 45%, says Robert Berkeley, president of Express KCS, one of the outsourcing companies. Thus, a paper could cut its costs to $30,000 a year per outsourced worker from $55,000 for an American doing the same job. These savings are even higher in unionized metro environments, where papers are struggling the hardest to sustain their margins.
The Columbus (OH) Dispatch was among the first to shift ad production to India, eliminating 90 jobs from a paper with daily circulation of 231,355. Assuming savings of $25k per employee, the paper should be able to add roughly $2.25 million a year to its bottom line.
Putting it another way: If a paper paid each departing employee a generous half-year of severance, the outsourcing project would begin to pay for itself in little more than 12 months – a terrific return on investment.
In what may be a harbinger of future initiatives elsewhere in the country, the San Francisco Chronicle has signed a 15-year contract with a Canadian company to begin printing the paper in in a new plant being constructed by early 2009. The opening coincides with the termination of the contract covering the newspaper’s 230 unionized press operators. When the new plant opens, their jobs will be gone.
While not outsourcing their production altogether, companies like the New York Times, Gannett, Media News and Journal Register have consolidated the printing and mailroom operations among certain of their geographically contiguous properties. In New Jersey, 200 production positions were eliminated when Advance Publications opened a plant to combine the production of the Newark Star Ledger and the Trenton Times.
While outsourcing production is complicated and not always feasible, the easiest jobs to shift are those of the people who work in telephone rooms or perform accounting, billing, accounts payable, human resources and other clerical functions.
Many newspaper groups already funnel want-ad and circulation calls to regional or national centers, where a single group of workers serving multiple time zones is far more efficient than a team dedicated to a single market. Many chains also have either consolidated clerical functions at in-house service bureaus or outsourced them to domestic vendors.
Sending call-center and clerical work offshore can shave 25% to 30% off the present costs of such operations, according to Gartner Research, a private firm. The New York Times and Boston Globe, among others, are each sending 40 to 50 clerical jobs to offshore contactors.
Even editorial and online operations are not immune from outsourcing.
Knight Ridder had a plan to create regional copy desks to handle headlines and layouts for groups of newspapers, a concept that was shelved prior to the sale of the company last year. Preposterous as the idea might sound, this is exactly what is being implemented in New Zealand by the publisher of the country’s largest daily and several other publications.
APN News and Media, a division of Britain’s Independent News & Media, is outsourcing about 70 jobs to an Australian company, according to Deutsche Presse-Agentur. If it works well, Independent News may extend the program to its titles in England and Ireland.
Reuters has more than 300 journalists in India writing many of the routine stories on its financial wires, according to MediaGuardian. Reuters has said it may increase the size of the Indian staff to 1,500 writers, though this could be affected by the potential merger with Thomson Corp.
And today's Los Angeles Times reports that a hyper-local website in Pasadena (not affiliated with a newspaper) has hired two writers in India, who, among other things, will cover city council meetings via webcam.
As valuable as Internet operations are to the future of newspaper companies, some publishers are having at least a portion of the work done overseas. London’s Financial Times, for example, relies on a staff in the Philippines to help edit and maintain its web site.
With offshore development, testing, hosting and technical support common in the information-technology sector, it is only logical that newspapers could achieve additional economies by moving – or expanding – many of these functions abroad.
When everything from designing buildings to analyzing X-rays can be performed by lower-paid professionals in another part of the world, there’s no reason to believe newspapers can avoid the workforce shake-ups that have jolted most other industries.
Institutional inertia and economic self-satisfaction have maintained the status quo until now. As an increasingly challenging business environment forces newspapers out of their comfort zones, many dedicated workers, unfortunately, will be forced out of theirs, too.
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