FAR FROM PRIME: On Wednesday, Primedia announced that it was putting New York magazine on the block. Coming shortly after the sales of Seventeen, Chicago magazine and its bridal titles, the latest move would seem to be the beginning of the end of the company as a publisher of major consumer magazines.
But selling New York — which executives at the company have said will take somewhere between one and five months — also means that it will be harder for Primedia to find a marquee executive to replace its former chief executive officer, Tom Rogers, who resigned in April after disagreeing with the board over the direction of the company.
According to a source close to the company, the list of potential successors — among them former Time Inc. international head Michael Pepe; former Ziff-Davis head Michael Perlis; Kelly Conlin, formerly the head of trade publisher IDG, and former Weider president Douglas Peabody —is now virtually empty, largely because so few executives want to come in and baby-sit a garage sale.
So where does that leave the search?
“No one knows what’s going on,” said the source. “There are reports they are looking at non-publishing people because everyone seems to have fallen off the short list.”
For now, Primedia is being run by interim chief executive Charles McCurdy, who could move up, but whom the company has not given a real vote of confidence.
And there could be more sell-offs coming. Inside Primedia’s business-to-business publications, staffers have been demoralized by cost cutting and layoffs, as well as long-running speculation that the company could choose to sell off the division, either piecemeal or in its entirety. Still, the sale of New York means it is probably not going to be sold immediately.
Primedia was invented in the Nineties out of the ashes of Rupert Murdoch’s magazine empire, when the leveraged buyout firm Kohlberg Kravis Roberts & Co. purchased nine consumer magazines, among them Seventeen and New York.
At the time KKR purchased it, New York magazine was wildly profitable. According to a 1991 New York Times article, the magazine was then making about $7 million on revenues of about $47 million. Today, faced with a company that has not known how to leverage the property and competition from Time Out New York, New York’s revenues are roughly flat — and would actually be down significantly taking inflation into account — while its profits have dwindled to around $1 million to $2 million.
So far Mort Zuckerman looks like the buyer to beat, in part because his ownership of both a regional paper (the New York Daily News) and a weekly magazine (U.S. News & World Report) makes him a fairly good fit. At the same time, he gets finicky when his friends get scorched in his own publications, and New York magazine is a recipe for a drink in the face at a cocktail party. U.S. News & World Report also isn’t doing that well, and Zuckerman has had a family health problem in recent months that has taken up an extensive amount of his time and focus. Jerry Finkelstein is also said to be interested, to the point where sources said he may even have made KKR honcho Henry Kravis an offer before the title went on the block. And no one is discounting Aurelian head William Reilly.
David Pecker, as usual, is talking a good game about the sale, and his newly installed editorial director, Bonnie Fuller, is a big proponent of buying the magazine, sources said, but the company was forced to lay off 70 employees this week to deal with diminished profit returns because of declining newsstand sales, the source of most of its revenue. New York’s media columnist, Michael Wolff, who wants to buy the magazine, needs cash from a group of investors, but his personal attachment to the magazine makes him a force to watch. — Jacob Bernstein
A LITTLE RESPECT: Women’s magazine editors finally let some of their frustration at the National Magazine Awards boil over Tuesday night at a Mediabistro-hosted dinner at the Four Seasons. Prompted by the host, most of the 100 or so editors present debated why their titles get so little respect from the judges. While no one plotted to picket the Waldorf-Astoria during next year’s awards, the conversations got heated enough that some debated whether to break away from the NMAs and start parallel awards (risking ghetto-ization) or try to reform them from within. Some of the editors making the loudest noise were Marie Claire’s Lesley Jane Seymour, Essence’s Diane Weathers and O: The Oprah Magazine’s Amy Gross.
Most suggestions centered on reform rather than secession and included dumping the circulation-based categories currently in place. They would then be replaced with topical awards that would find room for lifestyle and fitness categories, perhaps.
There’s no question the women’s books have gotten short shrift. Despite being the foundations of Hearst, Meredith and Gruner + Jahr, they’re perpetually frozen out of what one editor dubbed “the Tinkerbell Awards — clap if you want this magazine to last,” she said. “Even The New Yorker only got into the black this year,” and other perpetual winners like Harper’s and The Atlantic Monthly need money rather than make money.
Making things awkward at the dinner was the presence of Family Circle editor Susan Ungaro, who happens to also be the current president of the American Society of Magazine Editors, which oversees the NMAs. “Everyone was looking over at her and asking, ‘Where’s Susan been in all of this?’ and ‘Why hasn’t she stood up for us?’” according to one participant.
Ungaro said she and ASME executive director Marlene Kahan already have a lunch date with Weathers and several other editors to address concerns from the dinner. But she’s prepared to rule out wholesale changes. “I believe that we don’t want to slice and dice the award by every special-interest group,” she said. “Once you start, where do you stop? Automotive? Crafts? Food?”
Seymour, who described the mood that night as “a little boisterous,” nonetheless is sticking to her and her compatriots’ guns. “Of course, we all love ASME, but I think we didn’t realize what’s going on with the [low] number” of nominations for the women’s magazines. “Every now and then, maybe it’s time for a renovation.” — Greg Lindsay