So Time-Warner has finally spun off TIME, Inc., proprietor of 90 magazines and 45 websites, which will go its own way with $1.3 billion in debt. The new/old print-heavy journalistic entry was greeted by Wall Street today with a drop in its stock price.
I don’t know much about the latter-day magazine business, other than the intrepid survival strategies of my employer. But if you read through the New York Times story on TIME, Inc.’s trajectory, there’s a depressingly familiar bottom line:
The task of turning around the company has fallen to Joseph A. Ripp, the 62-year-old chief executive hired last September. A former chief financial officer of both Time Inc. and Time Warner, Mr. Ripp is self-confident, decisive and direct, and is considered a keen financial operator….
Mr. Ripp has also set about slashing costs in a culture where liquor carts once rolled in the halls and stories were chased all over the globe at great expense. According to two people with knowledge of the strategy, leaders at the company met with editors of Time Inc. publications last week and told them they were expected to make deep cuts in staffing and other areas — totaling 25 percent of editorial costs — in the coming months.
When that happens, we’ll undoubtedly hear optimistic talk about a newly lean-and-mean company that’s right-sized to succeed in a tough market environment. Next there will be closures of unprofitable and/or non-trendy mags and sites, and then maybe worse news, all wrapped in rationalizations about the limited options available to TIME’s management.
This should operate as a corrective to the under-warranted optimism associated with a few new journalistic enterprises that have snapped up a handful of familiar names and created a brief churn in opportunities for small fry as a declining number of job openings ripple through the industry. Niche markets will remain, of course, and some magazines and websites (including, I trust, WaMo) will be able to chug along by shining brighter against a darker background. But the brief sense of a Klondike Gold Rush upon the intrusion of some tech money into the news-and-views biz will likely subside, and soon become as anachronistic as the liquor carts that once trundled through the halls at TIME.
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