NO TALKS: Lagardère Active, the parent company of U.S.-based Hachette Fillipacchi Media, swatted down a report Wednesday that it was in talks with Hearst Magazines about taking over the U.S. operations of Hachette’s fashion title Elle. “Following an article published today in the New York Post, Lagardère Active, HFM U.S. parent company, formally denies being in negotiation with Hearst Corp. Group. There are no ongoing talks on a joint venture or licensing agreement with Hearst Corp. Group regarding Elle magazine in the U.S.,” Lagadère said. A Hearst spokeswoman declined additional comment. Elle launched in the U.S. in 1985 as a joint partnership between Hachette and Rupert Murdoch’s News Corp. In 1988, News Corp. sold its interests in both the U.S. and British editions of Elle for a reported $160 million to Hachette.
— Stephanie D. Smith
This story first appeared in the July 30, 2009 issue of WWD. Subscribe Today.
NO CLEAR VIEW THROUGH THE FOG: Three media companies released quarterly earnings Wednesday and executives at Time Warner Inc., Martha Stewart Living Omnimedia and Meredith Corp. are still reporting limited visibility of future advertising prospects. At Time Warner, chief executive Jeff Bewkes said there have been some signs of stabilization, noting that while the fashion, retail, financial and jewelry categories were down in advertising during the period at Time Inc., food and beverage, tech and telecom were up. Overall, ad revenue dropped 26 percent to $482 million in the publishing division, and total revenue fell 22 percent to $915 million. Online ad revenue accounted for 12 percent of Time Inc.’s total ad revenue for the quarter, compared with 9 percent during the same period a year ago.
At Martha Stewart Living Omnimedia, publishing revenues for the second quarter declined 28 percent to $33.5 million because of fewer ad pages, the timing of special issues and lower newsstand revenue. Internet revenues rose 31 percent to $4.2 million and digital ad revenues increased 28 percent compared to the prior year, while page views also rose 59 percent. The company reported an operating loss of $6.1 million, compared with operating profit of $1.7 million last year. In a separate filing, MSLO disclosed that new board member Frédéric Fekkai will receive $40,000 annually, as well as $1,500 for each meeting he attends in person and $1,000 for telephonic meetings.
Meredith reported fiscal 2009 and fourth-quarter results, noting total revenue fell 8 percent to $345 million in the quarter. The company posted a quarterly net loss of $163 million versus net profits of $19 million. In its publishing division, the company’s operating profit dropped 20 percent to $151 million and ad revenue declined 14 percent to $530 million. For the year, eight of Meredith’s 10 largest ad categories, including food and beverage, prescription and nonprescription drugs and household supplies, improved during the second half. Interactive ad revenue fell 5 percent for the year but rose 17 percent in the fourth quarter. Looking ahead to fiscal 2010, with two of three magazine issues closed in the first quarter, ad revenues are expected to be down in the midsingle-digit range.
— Amy Wicks
GOOGLE IN THE CLEAR, FOR NOW: Yahoo and Microsoft are joining forces in a bid to take on Google and its almost two-thirds share of the search advertising market. Currently ranking at number two and number three in the category, respectively, Yahoo and Microsoft have agreed to a 10-year deal that isn’t expected to be completed until sometime in 2010 and won’t be fully up-to-speed online for two to three years after that. If it goes through, Yahoo will provide the sales force and Microsoft the search capabilities, namely its revamped search engine, Bing. But that’s only if the deal goes through; federal regulators are already reportedly sniffing around. And the timing is a bit of a wild card, especially since two to three years is an eternity in the Web world, and new competitors could surface. So while it’s fair to say the news has obviously piqued the interest of employees at Googleplex, it’s also pretty clear their market share is safe for now.