Jeff Jarvis in The Guardian, Monday 4 May 2009
Left - Portfolio magazine website
On the heels of launching its resurrected Wired UK edition, Condé Nast last week killed its expensive, high-stakes and high-profile business magazine Portfolio in the US. Does this mean that magazines are next to suffer the misfortunes of newspapers?
I hate being the doomsayer for yet another medium, but I fear that Portfolio's demise - coming after Condé Nast's other recent American carcasses: House & Garden, Jane, Cargo, Vitals, Domino and Men's Vogue, not to mention mortally wounded titles such as Time and Newsweek - means, at the very least, that magazine launches become less likely.
It's simply riskier to start a magazine today because, just as in the other formerly mass media of newspapers and broadcast, it's harder to build a blockbuster. Magazines don't make money until they hit critical mass in audience and advertising, each a high bar.
Subscription-based magazines, such as Portfolio, lose money on sales to consumers until those readers renew a second or third time (in the US a quality monthly may sell for a discounted rate of $1 an issue even though it can cost more than $5 to print and distribute each one, on top of marketing costs of $20-$40 per new subscriber).
And magazine advertising, sold at high premiums, is struggling in the recession. Magazines are also having a harder time competing with online, where there is no scarcity of space and where performance can be measured on more tangible metrics than the amorphous value glossy magazines bring: branding.
The economics of magazine launches are simply terrifying. In 1990, I created and launched Entertainment Weekly at Time Inc and it burned through an astounding $200m before becoming profitable. No one is going to invest that kind of money again. If anybody would have, it was the privately owned and daring Condé Nast. Oh, well.
Jeff Jarvis' full piece here.
Thanks to veteran electronic media and Internet analyst Paul Reynolds for bringing this story to my attention.
Back the truck up here! The Internet may be taking away a lot of eyeballs from magazines and newspapers (e.g. the Boston Globe) but this type of writing is getting out of hand. It would be fair to say that in recent years, even with the Internet, there has been a proliferation of new magazine titles. In fact half of them seem to be about the Internet! The history of magazine and newspaper publishing is littered with births and deaths, and the occasional resurrection. It is a natural economic and business cycle. Let's face it most magazines are published because someone thinks they can do it better than existing titles and/or they can take that advertising revenue. How many fashion, gossip, computer, or business magazines do we need. While diversity of opinion is important, more isn't necessarily better. Part of the problem is around quality and part is around the demands made by the large publishers on their businesses for profits and growth and so the smaller companies get squeezed on the ad sales and their economics are turned upside down. I read magazines across music, the Internet, business, and economics and I simply don't have the time to read all the titles I would like to. Nor could I afford to buy them all. And when would I get to read books!
ReplyDeleteIt is always sad to see good titles disappear but hopefully the good writers will show up in other places. Good to see Wired UK back up, I enjoy the American one.