Forbes Magazine Plans More Layoffs

The New York Times - Forbes magazine said on Monday that it planned to lay off several staff members from the editorial and business sides, a cost-cutting move in response to decreasing advertising revenue.
The announcement was made in an internal memorandum sent Monday afternoon by Steve Forbes, the company’s chief executive and editor in chief of the magazine. “We — and the entire media world — have been hit hard by both the severe recession and the seismic shifts wrought by the Web,” Mr. Forbes wrote. “Given these dramatic events, further layoffs, unfortunately, are necessary across the entire organization.”
Monie Begley, a Forbes spokeswoman, declined to specify the number of layoffs. She said that some people had been dismissed Monday, and she expected layoffs to continue throughout the week.
The layoffs came after other cuts at Forbes over the last year, including dismissing about 100 employees, having employees take five days of unpaid leave, and ceasing matching contributions to its 401(k) program.
Although circulation has been holding relatively steady at Forbes, with reported circulation at 914,000 for the first six months of this year, according to the Audit Bureau of Circulations, ad pages have not. Ad pages dropped 32.5 percent in the third quarter, according to the Publishers Information Bureau, to just above 300 pages.

BusinessWeek, on the Block and Ailing

Editor's Note: BusinessWeek rode high on tech advertising during the 1990s making a lot of money for its owner, McGraw Hill. But during the past ten years, the publication has been squeezed between dailies like the New York Times and the Wall Street Journal on one end and monthly and bi-monthly publications Forbes and Fortune on the other end.

The New York Times - Numbers sometimes tell a story. And the figures for BusinessWeek suggest it is having one tough time.

Bids are due Tuesday for the magazine, which McGraw-Hill has owned for 80 years. A handful of potential investors, including Bloomberg L.P., are still looking at the company. But before buyers had a chance to comb through the magazine’s finances, initial interest had been much higher. BusinessWeek lost more than $43 million last year, though that included certain costs like rent and overhead, which a document sent to potential investors suggests McGraw-Hill has been charging too much for. A buyer would also have to assume much of the $31.9 million in debt.

As the thwarted sellers of The Rocky Mountain News and The Seattle Post-Intelligencer have discovered, this year is not a good time to sell news media outlets. Print advertising is down, and readers’ attention is being diverted to the Web. Business magazines, including BusinessWeek and rivals like Forbes and Fortune, have been hit particularly hard, as automotive, financial services and technology advertisers have pulled back their marketing spending.

So far, about six investors appear interested in BusinessWeek, including OpenGate Capital, which bought TV Guide for $1 last year; Warburg Pincus; and Platinum Equity, which is also bidding for The Boston Globe.

Other candidates include Bloomberg; Joe Mansueto, the founder of the ratings firm Morningstar who bought Inc. and Fast Company in 2005; and Bruce Wasserstein, the chairman and chief executive of Lazard, who also owns New York magazine.

But Peter P. Appert, who is an analyst at Piper Jaffray, argued that BusinessWeek’s future was cloudy. “I don’t think the prospect of meaningful earnings recovery is particularly good,” he said.

BusinessWeek executives declined to comment for this article, as did a McGraw-Hill spokesman, Steven H. Weiss. He referred a reporter to a July news release in which McGraw-Hill said it was “exploring strategic options” for the magazine.http://www.nytimes.com/2009/09/14/business/media/14bizweek.html

Conde Nast to Shut Portfolio Magazine

CHICAGO (MarketWatch) -- Publisher Condé Nast will shutter Portfolio and its Web site by the end of the second quarter, it said Monday, as declining advertising sales across the industry claim another casualty, this time after only 21 issues.
Portfolio staffers received the news Monday morning from Editor-in-Chief Joanne Lipman.
Condé Nast had previously decided to scale back Portfolio to 10 issues a year from 12.
Last October, Condé Nast, whose other titles include the New Yorker, Vanity Fair and Wired, informed top executives at all 26 of its magazines to make two separate 5% cuts within its budget, reducing both payroll and nonpayroll expenses.
It also said it would fold Men's Vogue into Vogue, the long-running women's magazine, and cut it to two issues a year from a previous 10.
Portfolio, launched in May 2007, centers on the business of media, and as such has chronicled the painful decline of newspapers and magazines as a consumer shift to online readership and a devastating recession have combined to endanger the model that sustained such publications for generations. See First Take item on Portfolio's shutdown.
While newspapers and magazines have tried to create strong presences online, the money they receive for digital ads is not enough to sustain both Web-based and print versions.
Even without the overhead of printing presses and other costs related to the delivery of a print product, an online-only entity could struggle to maintain a newsgathering organization large and experienced enough to do battle amid ever-growing competition. http://www.marketwatch.com/news/story/cond-nast-shut-portfolio-magazine/story.aspx?guid={1DCD02AC-32E9-4BDD-A8C2-6FDE32A41330}&dist=msr_1&print=true&dist=printMidSection

Today's Headlines

2 Homebuilders Merge in $1.3 Billion Deal

NYT - In a transaction that would create the nation’s largest homebuilder, Pulte Homes and Centex said Wednesday that they would merge in a $1.3 billion stock-for-stock deal.The transaction valued by the companies at $3.1 billion, includes $1.8 billion in debt.The two companies are hoping that the merger will help them survive a severe slump in the housing market that has helped lengthen a recession that started in December 2007. Homebuilders have sharply cut back construction and prices as they try to reduce inventories. Centex lost $664 million in the quarter that ended in December while Pulte reported a $338.2 million loss. http://www.nytimes.com/2009/04/09/business/09build.html

They Pay for Cable, Music and Extra Bags. How About News?

NYT - Just a year ago, most media companies believed the formula for Internet success was to offer free content, build an audience and rake in advertising dollars. Now, with the recession battering advertising online, in print and on television, media executives are contemplating a tougher trick: making the consumer pay. Publishers like Hearst Newspapers, The New York Times and Time Inc.are drawing up plans for possible Internet fees. Jeffrey L. Bewkes, Time Warner’s chief executive, is promoting a plan called “TV Everywhere,” to offer consumers a vast array of television online, provided they are paying cable TV customers. And Rupert Murdoch, who once vowed to make The Wall Street Journal’s Web site free, is now an evangelist for charging readers.http://www.nytimes.com/2009/04/08/business/media/08pay.html


Magazines Blur Line Between Ad and Article

NYT -If the separation between magazines’ editorial and advertising sides was once a gulf, it is now diminished to the size of a sidewalk crack.Recent issues of Entertainment Weekly, Esquire, Time, People, ESPN the Magazine, Scholastic Parent & Child and other magazines have woven in advertisers in new ways, some going as far as putting ads on their covers. In a medium like television, a partnership with advertisers is nothing surprising — look at how often plastic bags and containers from Glad are featured on “Top Chef.” But in magazines, the editorial and advertising sides have stayed distinct, largely because of the American Society of Magazine Editors. The society hands out the annual National Magazine Awards, and its guidelines govern how editorial content and advertising should be kept separate. Cover ads are prohibited.http://www.nytimes.com/2009/04/08/business/media/08adco.html

Big GM Bondholder Sells Its Stake

NYT -As talk continues to circulate about the likelihood of a General Motors bankruptcy, one of G.M.’s significant bondholders has shed the bulk of its holdings, according to a regulatory filing.The bondholder, Southeastern Asset Management, and its investment group, Longleaf Partners, both of Memphis, now hold 9.6 percent of G.M.’s Series B bonds, Southeastern said Tuesday in a filing with the Securities and Exchange Commission.Southeastern held 33 percent of G.M.’s Series B bonds as recently as September. Its bonds were convertible to 13.2 million G.M. common shares, or about 2.3 percent of G.M. stock, according to Bloomberg News.http://www.nytimes.com/2009/04/08/business/08gm.html


As Room Rates Sink, Sleepless Nights for Hotel Investors

NYT - In San Francisco, prices of hotel rooms have “gone off a cliff,” said Karl Hoagland, chairman of Larkspur Hotels and Restaurants. Softening demand has led some luxury hotels to offer rooms for less than $100 a night.“It’s a great windfall for travelers,” said Mr. Hoagland, whose company owns three hotels in the city’s Union Square neighborhood.But it is anything but a windfall for Mr. Hoagland. His company paid about $100 million for the three hotels, in 2006 and 2007. “It was a pretty big bet on San Francisco,” he said.http://www.nytimes.com/2009/04/08/business/08hotel.html

Consumer Borrowing Declined in February

WASHINGTON (AP) — Consumer borrowing plunged in February at a 3.5 percent annual rate, more than analysts had expected, as Americans cut back their use of credit cards by a record amount.The Federal Reserve said Tuesday that consumer borrowing dropped at an annual rate of $7.48 billion in February from January, which amounts to a 3.5 percent annual rate of decline. Wall Street economists expected borrowing to slide by only $1 billion, according to a survey by Thomson Reuters. http://www.nytimes.com/2009/04/08/business/economy/08econ.html

Judge Orders Probe of Prosecutors

WSJ - WASHINGTON -- A federal judge ordered a criminal investigation into prosecutorial misconduct in the trial of former Alaska Sen. Ted Stevens, and suggested that the botched case exposed a deeper problem at the Justice Department.U.S. District Judge Emmet G. Sullivan appointed a special prosecutor to look into possible criminal contempt-of-court charges against six federal prosecutors who the judge said withheld evidence from defense lawyers.Judge Sullivan erased the corruption conviction of Mr. Stevens and dismissed the case, in line with a request last week by U.S. Attorney General Eric Holder. A federal jury in October convicted Mr. Stevens on seven counts of failing to disclose free home renovations and other gifts from friends. The verdict came just eight days before Election Day, and the Republican lost his re-election bid by fewer than 4,000 votes, handing Democrats a crucial seat in the Senate.http://online.wsj.com/article/SB123911047345896733.html

Pirates Seize U.S.-Flagged Ship

WSJ - DUBAI -- Pirates on Wednesday seized a U.S.-flagged container vessel off the coast of Somalia, raising the stakes for American naval commanders battling a recent surge of attacks in the region. A spokeswoman for the U.S. Fifth Fleet in Bahrain said the attack took place early Wednesday about 240 nautical miles southeast of the pirate haven of Eyl, Somalia. The Navy didn't release detailed information about the ship, but A.P. Moller Maersk, the Danish shipping giant, identified the vessel as the Maersk Alabama, a large container ship.http://online.wsj.com/article/SB123918590857500753.html

Do-It-Yourself Magazines, Cheaply Slick

Philip Chavez binding a MagCloud magazine at Progressive Solutions, which prints about 50,000 pages a month for the service.

The Wall Street Journal - PALO ALTO, Calif. — For anyone who has dreamed of creating his own glossy color magazine dedicated to a hobby like photography or travel, the high cost and hassle of printing has loomed as a big barrier. Traditional printing companies charge thousands of dollars upfront to fire up a press and produce a few hundred copies of a bound magazine.

With a new Web service called MagCloud, Hewlett-Packard hopes to make it easier and cheaper to crank out a magazine than running photocopies at the local copy shop.

Charging 20 cents a page, paid only when a customer orders a copy, H.P. dreams of turning MagCloud into vanity publishing’s equivalent of YouTube. The company, a leading maker of computers and printers, envisions people using their PCs to develop quick magazines commemorating their daughter’s volleyball season or chronicling the intricacies of the Arizona cactus business.

“There are so many of the nichey, maybe weird-at-first communities, that can use this,” said Andrew Bolwell, head of the MagCloud effort at Hewlett-Packard. Samir Husni, a journalism professor at the University of Mississippi who plans to use the technology in his classroom, said, “We’re not talking about replacing the Vanity Fairs of the world. But it’s a nifty idea for a vanity press that reminds me of the underground zines we had in the ’60s and ’70s.http://online.wsj.com/article/SB123836938251967565.html

Mother Jones Tests Nonprofit Model in Race to Survive the Recession

The New York Times - In its beginning Mother Jones, the leftist magazine founded in 1976 in San Francisco, viewed itself as a defender of independent journalism free from corporate meddling.

Today it sees itself as a defender of journalism itself.

As such, Mother Jones has become a real-life laboratory for whether nonprofit journalism — a topic of the moment in mainstream news media circles — can withstand a deep recession.

Mother Jones, named for the early-20th-century radical labor organizer Mary Harris Jones, is a nonprofit bimonthly that has long sponsored investigative journalism in the tradition of Upton Sinclair. It cemented its reputation with a famous piece in 1977 on the Ford Motor Company’s indifference toward a fuel tank design flaw; the article has come to be known as the “exploding Pinto” story.

Back in the fall, when the economic downturn intensified, and the plight of print publications became more dire, Mother Jones suffered, despite its position of not being in it for the money. Advertising plummeted, down 23 percent in 2008, and some of the big donations the magazine depends on didn’t come through.

While it is not a new idea, the future possibilities of nonprofit, endowed journalism as a cure for the economic problems facing the print industry have recently engendered a lively debate within journalistic circles, in blogs and in articles in The New Yorker and on the Op-Ed page of The New York Times.

“We’ve been hearing from more and more people, ‘How does that work?’ ” Ms. Bauerlein said. “ ‘What’s it like being a nonprofit?’ ”

But as Mother Jones’s example shows, nonprofit publications, while they may initially be more durable in a down economy, are far from impervious to market forces. http://www.nytimes.com/2009/03/07/arts/07jones.html

Things So Bad at Magazines - Even Conde Nast in Retreat

The New York Times - “The September Issue,” a documentary about how the staff of Vogue puts together that curio of profligacy, the magazine’s fall preview, was a big hit at the recent Sundance Film Festival. Part of the reason attendees found it so mesmerizing has to do with Anna Wintour, who always begets staring.

But much of its appeal has to do with the fact that any peek inside the Death Star, as the headquarters of Vogue’s publisher, Condé Nast, is affectionately known, is going to be met with prurient interest.

Home to magazines like Vogue, The New Yorker and Vanity Fair and the gossamer creatures who produce them, the building is surrounded by a phalanx of idling black cars and decorated with fables about discarded six-figure photo shoots and editors who FedEx-ed their luggage ahead of them so as not be burdened on the commute.

But in a week when the news came that the gross domestic product shrank 3.8 percent in the fourth quarter, even the Death Star feels the pull of economic gravity. Domino, a shelter magazine for smart young things that was first published in 2005, was closed just two weeks after the company put Bill Wackerman, one of its most prized executives, in charge of turning it around.

Company executives, none of whom wanted to be quoted, said that the complete implosion of ads made it impossible to continue, although it doubled its estimate of Domino readers to 850,000 and was generally well received.

The loss of a single magazine would seem like small beer, but when the belt being tightened is Chanel, it seems all the scarier. If those people are under the gun, what is to become of everybody else in the media business?

Historically, Si Newhouse, the company chairman, had demonstrated legendary patience in bringing along its magazines. The New Yorker lost money for almost 18 years at Condé Nast — the burn rate was ferocious as Tina Brown sought to reinvent the fustian title — but it eventually went into the black and created a lustrous editorial asset for the company.

But when the current editor, David Remnick, ordered up a bunch of articles for the magazine’s formidable presidential inauguration issue, some of the reporters drove to Washington and stayed at friends’ houses. Mr. Remnick, who was among those who bunked with a friend in Washington, declined comment, beyond suggesting it was just common sense to preserve assets for other articles. “Steve Coll can’t stay at a friend’s house in Afghanistan,” he said. http://www.nytimes.com/2009/02/02/business/media/02carr.html?partner=permalink&exprod=permalink

Gloom For Glossies - Suffering Magazines

Another day, another closure. Magazines are becoming thinner as advertising pages fall, and publishers are grimly cutting underperforming titles. But the outlook is not dour for all — a handful of magazines are still expanding their ad lineups, some by startlingly high percentages.http://www.nytimes.com/interactive/2009/01/30/business/20090201_metrics.html?partner=permalink&exprod=permalink