Portfolio rollback

Condé Nast Cuts Focus on 2 Magazines:

Through the first nine months of the year, ad pages in all United States magazines were down 9.5 percent from the same period in 2007. Most magazines produced by Condé Nast – including Vogue, GQ, Architectural Digest and Wired – have had much smaller declines, but they are also among the most expensive magazines to produce.

Portfolio, started last year amid much fanfare, is Condé Nast’s first business magazine and its most expensive new project in years. Executives said the company was willing to lose more than $100 million on it.

I immediately thought of this, Can Si Newhouse Keep Condé Nast’s Gloss Going?:

Some extravagances have been curtailed, but no one in the business disputes that Condé still spends far more money than its competitors. Magazine publishers and editors in chief haul in $400,000 to $2 million in salary and bonuses, current and former executives say, and many executives have clothing allowances in the high five figures.

Last July, Vanity Fair printed 20 different versions of its cover, a daisy chain of celebrity pairs shot over many months and on multiple continents by Ms. Leibovitz, a project that cost millions. It paid for itself, says the magazine’s editor, Mr. Carter, in increased newsstand sales and buzz.

Mr. Phillips, the investment banker, observed, “I would say if you look across their whole portfolio, Condé Nast does a better job of producing high-quality magazines than anybody else in the industry.” But, he adds, “you really could spend a lot less money on those magazines without affecting quality.”

I remember thinking at the time that when the bubble bursts they’ll regret not running a more efficient operation. To some extent it seems like Advance treats its glossies like performance art as opposed to a business operation. Of course, S. I. Newhouse is nearly a 10 billionaire so I guess he can afford to be less orthodox than the typical billion-pinching mogul. At least The Big Money isn’t going anywhere.

H/T Tyler.

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