Are Cuts Coming at Time Inc.?

CEO Mentions Trimming Mag Portfolio; Company Denies Plans to Sell Titles

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NEW YORK (AdAge.com) -- Still on Ann S. Moore's to-do list: trimming the portfolio of Time Inc. titles.

That's the impression she left with many staffers after a quarterly management meeting March 27. Ms. Moore, Time Inc.'s chairman-CEO, told top managers that she is still looking carefully at the portfolio of magazines so the company -- the country's biggest magazine publisher, with brands such as Time, Sports Illustrated and People -- can focus on the titles best positioned for growth in print and online.
Time Inc. chairman-CEO, Ann Moore
Time Inc. chairman-CEO, Ann Moore

Although that notion isn't new, a slide stating "Trim Portfolio" shown as part of her presentation revived speculation within the company about just which titles may still be at risk of going on the block.

Bewkes' re-examination
Time Inc. is expected to undergo some significant changes as Jeffrey Bewkes, CEO of parent Time Warner since Jan. 1, re-examines the entire conglomerate and tries to boost the flagging stock price. He already has ordered the consolidation of New Line Cinema with Warner Bros. Entertainment and the division of AOL in two. Many at Time Inc. believe their unit's turn is next.

A Time Inc. spokeswoman said Ms. Moore was describing good business strategy, not a specific course of action. "There are no plans to close down any magazines or sell any magazines," the spokeswoman said. "That said, as part of good business practices, you are always looking at your portfolio. We're also looking for smart acquisitions. One of the presentations ... was a recent acquisition, the fifth-biggest website in Mexico and the largest sports site, Medio Tiempo."

Although Ms. Moore did not single out any titles during her presentation, certain categories came under scrutiny. She pointed to challenges in the home market that particularly affect titles such as This Old House and Southern Progress brands such as Coastal Living and Cottage Living. She also cited the damaging effects the writers strike and falling DVD sales have had on Entertainment Weekly.

Ad pages at This Old House sank 12.8% through its April issue, according to the Media Industry Newsletter. Ad pages at Cottage Living, a 4-year-old launch that is said to be on track for profitability, have slipped 3.7%. Coastal Living has seen ad pages decline 13.1% so far this year. And ad pages at Entertainment Weekly, a newsstand cash cow, have fallen 22.5% through its March 21 issue.

Spokeswoman for the magazines declined to comment.

Difficult transformation
Time Inc., whose star performers singled out include People and Real Simple, is undergoing a sometimes-wrenching transformation from a print company to a multiplatform media company. Moves toward that end -- amid challenging market conditions for all print publishers -- have included hundreds of layoffs, the shutdown of titles such as Teen People and Life, and the sale of 18 magazines.

Ms. Moore said in 2006 that she had decided to sell the 18 titles -- which included Motorboating, Skiing, Popular Science, Outdoor Life and Field & Stream -- because Time Inc. needed to devote its time and money to bigger, more lucrative properties. "While these titles are good performers, Time Inc. is focusing its energy, resources and investment on our largest and most profitable brands, brands that have demonstrated an ability to draw large audiences in print and digital form," she wrote in an employee memo.

As in 2007, according to the company, digital sales growth in the beginning of 2008 is outpacing any decline in print. CNNMoney.com reported 16 million video streams in February, its broadband video channel's first full month.
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