IBT Media, the pure-play digital company that has agreed to buy Newsweek, is not ruling out a print return of some sort for the iconic magazine.
What the International Business Times Wants With Newsweek
"We are 100% a digital publisher," said Johnathan Davis, co-founder and chief content officer at IBT Media, which publishes 10 global news sites including its flagship publication the International Business Times. "That being said, we don't want to exclude [print] from our future plans."
IAC/InterActiveCorp said Saturday that it had agreed to sell Newsweek to IBT Media for an undisclosed amount. The deal did not include The Daily Beast, the IAC property with which Newsweek was combined.
Mr. Davis and IBT Media's other co-founder, CEO Etienne Uzac, said Newsweek gives the seven-year-old company a measure of cachet in the editorial space and additional revenue streams on the business side that it didn't have in the past. The International Business Times is supported by advertising. Newsweek provides the company with not only additional ad revenue, but also a base of paying subscribers, which they said has been growing since Newsweek went digital-only at the end of 2012.
"We believe in the Newsweek brand of hard-hitting, thought-provoking journalism and deep analysis," Mr. Uzac said. "We want to continue and build upon that."
The New York-based IBT Media, which Mr. Davis and Mr. Uzac founded in 2006 as IBTimes, employs 200 people in 10 countries. Mr. Davis and Mr. Uzac said the company, which has not received outside capital, became profitable in 2010, though they would not disclose revenue or other financial details.
"We've been a lean and efficient operation," Mr. Davis said. "That's what works for us."
Through the International Business Times and its nine other news sites -- which include the Latin Times and Medical Daily -- IBT Media aims to cover global business and connect the dots for readers, with a strong focus on global coverage (as implied by the name). The main IBTimes site got 8.1 million unique visitors in the U.S. in June and 16.8 million worldwide, according to ComScore.
Owning the Newsweek brand makes it easier for IBT Media to break into other international markets, Mr. Davis and Mr. Uzac said.
Newsweek has continued in print in a variety of foreign countries through agreements with licensees. IBT Media said it will continue to honor those agreements and possibly expand upon them, giving the company a newsstand physical presence in many of the countries where it reports.
"Brand is key," said Mr. Davis. "With a strong brand, we can accelerate our global growth. It's something that would've taken longer for IBT Media without Newsweek."
The deal between IAC and IBT Media is expected to close in about a week, at which point IAC will continue to run Newsweek for roughly 60 days. During that time, IBT Media will evaluate Newsweek's current staff, which consists of roughly 20 people, said Mr. Davis and Mr. Uzac, who noted that some of those employees are also tied to The Daily Beast.
"I think we'll bring employees from Newsweek," Mr. Davis said.
IBT Media began speaking casually with IAC about potentially buying the magazine two years ago, when -- in an odd twist of fate -- IBT Media moved into Newsweek's old New York headquarters. Discussions got serious in recent months, as IAC began seeking buyers in earnest.
Unloading Newsweek likely comes as a relief to Mr. Diller, whose IAC acquired Newsweek in 2010 and merged it with The Daily Beast. In April, he told Bloomberg that buying the magazine was a "mistake."
Newsweek's web address, which currently redirects to The Daily Beast, will be restored once IBT Media gains control of the title, the company said. Mr. Davis and Mr. Uzac stressed that they have no plans to fold Newsweek into the International Business Times. Newsweek, which introduced a fairly dramatic redesign shortly before it was confirmed that IAC was entertaining offers for title, will be a standalone site, the said.
The recent history of the 80-year-old Newsweek has been turbulent. The Washington Post Co. sold the magazine, which was losing money at a swift pace, to stereo magnate Sidney Harman in 2010 for $1 plus the assumption of $40 million in liabilities. Mr. Harman then merged the title with IAC's Daily Beast, partly to secure the services of Daily Beast Editor-in-Chief Tina Brown as editor of Newsweek as well.
The merger failed to deliver the magazine back to health, however, so after shutting down the U.S. print edition IAC confirmed in May that it was entertaining offers for Newsweek.