MAGS STABLE IN CEO SHUFFLE
Byline: Lisa Lockwood
NEW YORK — With the naming this week of two new chief executives of media giants AOL Time Warner and The Hearst Corp., media executives don’t anticipate any dramatic changes in their magazine divisions.
Although the magazine business has suffered enormously from an advertising decline this year, industry executives believe the new ceo’s will be as supportive of the magazine divisions as their predecessors and will stay the course.
As reported, Victor F. Ganzi, chief operating officer of Hearst, will succeed Frank A. Bennack Jr., as president and ceo. Bennack, who will step down in June, had served in the role 23 years, the longest of any ceo other than William Randolph Hearst himself.
And, Richard Parsons, co-chief operating officer of AOL Time Warner, will succeed Gerald M. Levin as ceo after the company’s annual meeting in May.
Both Bennack and Levin are considered huge supporters of their respective magazine businesses. Bennack, in fact, hired Cathleen Black as president of Hearst Magazines, having established a friendship with her when she was president of the Newspaper Association of America. Bennack had been chairman of the NAA in the early Nineties.
Under Bennack’s watch, Hearst launched such titles as O, the Oprah Magazine, SmartMoney and Marie Claire, while under Levin, Time Inc. launched magazines such as In Style, Teen People, Real Simple and People en Espanol.
But like all publishing companies, Hearst and Time Inc. have had a tough 2001. In Style, published by Time Inc., suffered its first ad decline in its history, logging a 7.5 percent drop in ad pages this year, according to Media Industry Newsletter. Talk, published jointly by Hearst Magazines and Miramax, is looking for additional investors, and Hearst is currently in the midst of relaunching Harper’s Bazaar with the February issue. That title was off 8 percent for the year, according to MIN.
Addressing Ganzi’s appointment, a Hearst spokesman said, “It will be business as usual. We’ll continue to be a preeminent publisher of monthly magazines, as well as be fully engaged in new magazine opportunities.”
Nora McAniff, president of The People Group at Time Inc., said “I think Dick Parsons is wonderful — smart and engaging. I’ll miss Jerry, but Dick will be a fine leader, and I can honestly say that the move will have absolutely no impact, positive or negative, on the magazine business. He’s so good at forging cooperation among the many constituencies that he deals with, from Washington to Hollywood, and that’s what we’ll need to keep this multi-faceted organization moving forward.”
An AOL Time Warner spokesman added that the Time Inc. magazine division won’t be affected by the new streamlined restructuring. Don Logan, ceo of Time Inc., continues to report to Robert Pittman, who was previously co-chief operating officer with Parsons, and will now be the sole chief operating officer.
“No one here is biting their knuckles,” said one insider.
Levin has been a big supporter of Norman Pearlstine, editor in chief of Time Inc., whom he brought into the company in 1994. Observers expect Parsons, who was hand-picked by Levin, to also be a strong advocate of the magazine division. According to sources, Pearlstine is well regarded at Time Inc., and Levin’s departure shouldn’t have any impact on his standing at the company. Pearlstine, who reports to Logan, couldn’t be reached for comment.
Most media observers believe both appointments are good for the magazine business.
Chris Tinkham, director of media promotions at DeVito/Verdi, an ad agency here, said he was optimistic about Parsons’ appointment.
“If anything, it bodes well for the magazine division. Here is a guy who knows how to find a middle ground, given his negotiations with some of the major corporations. What that demonstrates is a value for relationships. The magazines, as a business, compared to the Internet as a business, have a lot more depth with advertisers. Things that bode well for the magazine division will bode well for the advertisers.”
As for Ganzi’s appointment at Hearst, one insider said, “This is the most seamless change we’ve ever seen. Vic is a strong supporter of the magazine company and has a substantial financial background. It’s a win-win for the magazine division.”
Known as a workaholic, Ganzi is a former managing partner at Rogers & Wells, one of the largest international law firms. He handled the Hearst account and was significantly involved in Hearst’s recapitalizations and all its acquisitions. He joined Hearst in 1990 as general counsel and vice president. In addition to serving on such boards as Hearst-Argyle Television, and ESPN, Inc., Ganzi is also on the board of the Palm Management Corp., the entity that operates the various Palm Restaurants, that has been 50 percent owned by his family for the past 75 years.
Ronald A. Galotti, president of Talk Media, said, “Vic has been involved in every bit of the partnership with Talk. I find him to be incredibly bright and unbelievably articulate in regard to the magazine business.”
“He’s a fan,” added Galotti. “He reads our magazine, and he cooks a mean steak.”