It’s the Economy, Stupid!October 31, 2008
Ann Moore, CEO of Time Inc. is reported in Folio saying that
Time Inc.’s decision to reorganize had “nothing to do with digital and one hundred percent to do with the recession.” The reasons for Time Inc.’s reorganization, Moore said, included centralization for faster decision making; collaboration and sharing across titles; simplification to eliminate all work that doesn’t add value to Time Inc.’s editorial department or client services (“you can always add them back,” she said of cut positions); alignment of goals to reduce costs and grow revenues; and innovation, citing the company’s launch of Maghound and LIFE.com.
The prophets of doom and gloom continue to rally their forces to predict the death of print using examples of magazines either shutting down or scaling down their publishing frequency. What those prophets fail to see is that we are witnessing the worst economic crisis in our history. Banks are closing, credit lines are frozen, and investment banks are disappearing… and guess what, the web and the internet are not the reason for that… it is the economy. Why is it so hard for our prophets of doom and gloom to accept the fact that this down cycle in the magazine industry has little, if not nothing, to do with the web or the internet, but rather with the economy and the publishing model that our magazine publisher follow in this country since WWII. The advertising funded model has worked fine for years and years. It is time to change and to start to look at circulation driven models where readers and customers pay the price of the magazine without ad subsidies. The publishing model is broken, and most of the bailout plans that I have seen so far, fail short of a drastic change in the way we do business. If now is not a good time for change, I have no earthly idea when will be a good time.
On another front, it never ceases to amaze me that when I report bad news when it comes to new magazine launches, the prophets of doom and gloom directly post my blog on theirs and spread the news. When I reported last month about what a great September it was for new magazines, only one newsletter reported the story. In few days I am going to report on Oct. launches, and guess what, the numbers are up again and they will surprise you in the midst of those dreadful economic times. Don’t count on the prophets of doom and gloom to report those number either. There are still a lot of good news to read and enjoy in our magazine world. Take a look at the 3rd quarter of the new magazine launches. Relax and take a deep breath. The light at the end of the tunnel is NOT the train coming.