|Steve Florio leaves a much stronger Conde Nast.
STEVE FLORIO STEPS DOWN AS CONDE NAST CEO
Insiders Cite Health Issues
In a Tuesday morning interview Mr. Newhouse, the chairman of Advance Publications, which owns Conde Nast, said Mr. Florio's legacy is in growing the company while preserving its culture.
"When Steve was appointed CEO we were a relatively small company, and he retires at a time when it is a very dynamic company," Mr. Newhouse said. "There's a focus on both the maintenance of its culture and improvement of its business. It's a powerhouse. We're the second [largest] company in publishing today and perhaps the first in terms of stature."
On Monday, Conde Nast shocked the publishing industry with the unexpected announcement that the highly respected Mr. Florio was leaving his post and would be replaced by Charles Townsend, the CEO of Advance Magazine Group.
Mr. Newhouse said the decision was Mr. Florio’s, but that “after 10 years and his history of illness, I think this was an appropriate move to make."
Asked if he had considered other internal or external candidates to succeed Mr. Florio, Mr. Newhouse chuckled softly when he said, "This was not an exhaustive search. When I found out about Steve's decision, I moved very quickly and without hesitation and asked Chuck to take the job. He's a brilliant executive who's well-versed in all aspects of publishing. He has a sensitivity about the excellence of what we do, and that edit comes before the business side, but he also has great business-side skills."
Mr. Newhouse said he doesn't think the difference in styles between Mr. Florio -- known for his aggressive, street-smart style -- and the more buttoned-down Mr. Townsend will alter the company's tone. "The culture is so strong that it goes without saying that this is the first consideration of the CEOs we've had. It affects our acquisitions, our start-ups and our budgeting."
He said Mr. Florio's bombastic style and some of the marketplace rumblings it stirred up never worried him. "I worked very closely with Steve and the other key executives here. I know the inside and I read about the outside. There are lots of rumors, but being on the inside I'm able to sift what is true and what is exaggerated."
Under Mr. Townsend, Conde Nast is expected to continue to grow its stable of titles, more likely by launching new ones than buying them. Conde Nast publishes Vanity Fair, Vogue, GQ, Self, Gourmet and Allure, among other titles. The New Yorker is also owned by Advance Publications.
Growth and acquisitions
"Growth and acquisitions are certainly an important component of publishing," Mr. Newhouse said. "There are few magazines that we would acquire comfortably, but there is an unlimited number of start-ups. I hope that in the future we can expand through start-ups and internal growth. That would be the goal."
Although Mr. Townsend put together the Advance Magazine Group, which combined back-office operations for the various publishing units of Advance, Mr. Newhouse said he does not see the opportunity to more closely integrate the publishers, which include Conde Nast, Fairchild Publications (Details, W), Parade Publications and Golf Digest Cos. "They're distinct and have their own cultures," he said.
Asked about Mr. Florio's role in bringing more financial discipline to the privately held company and improving profit margins, Mr. Newhouse said that while that was important, "perhaps more important was the reputation for quality and integrity and general excellence that the company has."
"The bottom line," he added, "takes care of itself."
As a footnote, Mr. Newhouse, who at 76 is 21 years older than Mr. Florio, said he has no plans to stop working. "Under no circumstances am I thinking about retirement," he said. "I seem to be functioning well enough, and I hope to continue."