Ask More of Business

Asking More Commentary: Perspectives from Mendoza College of Business

Commentary Post - James S. O'Rourke

Newsweek might have gone digital, but the magazine industry isn’t dead

January 10, 2013

Newsweek magazine, that venerable doyenne of the national news trade, finally hit rock bottom.  No more print edition as of January 1.  It’ll all be online now.  Good luck drawing an audience.

Newsweek’s decline began in the 1980s.  The moment for me came in 1992 when they featured Tipper Gore on the cover and identified her as “Second Lady Elect of the United States.”  Who elected her?  Before you think much further on this, that was the moment Newsweek editors decided the real audience was in celebrity journalism.  Mrs. Gore didn’t have a political agenda, didn’t stand for elective office, didn’t have much to say that hadn’t been written by the Clinton-Gore campaign staff.  And, yet, our attention was drawn to her because she was suddenly famous.

When Time magazine realized that the “People” section of its widely read weekly was more popular than any of their mainstream news, the folks at Time-Life quickly capitalized on that insight and opened a magazine called People Weekly.  The weekly portion of that title was soon jettisoned.  The inaugural edition on March 4, 1974 featured actress Mia Farrow on the cover and stories about Gloria Vanderbilt and other celebrities of the day.  Nothing in the way of serious news ever made its way onto the pages of People.

When Newsweek editors realized they had closed down most of their news-gathering bureaus, they were left with little other than celebrity gossip and paparazzi pictures to print.  That space, unfortunately, is now occupied by TMZ and a wide range of online and cable-based sources.  I would give Newsweek another six months before the current publishing staff realize that Sidney Harman overpaid The Washington Post when he gave them $1 for the magazine in 2010.

Felix Salmon of Reuters news service says he’d be worried about the long-term value of owning a magazine these days and, without question, there are plenty in the business who would agree.  The short-term cash value of a magazine, though, is unquestionably a good deal.  If you compare magazines to digital startups, it’s no contest.  Digital platforms are designed to burn through their cash reserves until they’re gone or someone buys the company.  Well-run, tightly-edited, thoughtful magazines, on the other hand, will continue to make money. 

Magazine subscribers tend to be loyal, better-educated, higher-earning, informed attenders.  Advertisers realize that and are willing to pay more to put a message in front of such audiences.  This is a rough time to be in the newspaper business, and even rougher to be in magazines, if you don’t know who your audience is and what messages they’re searching for.  On the other hand, if you write for an intelligent audience, delivering useful, thought-provoking composition you’re likely to find a welcoming, profitable niche for many years to come.