At a time when people don’t want to wait a minute for information, let alone seven days, do newsweeklies have a future? If Newsweek does, it won’t be with its current owner.
The 77-year-old magazine, hobbled by sagging ad revenue and circulation, has been put up for sale by The Washington Post Co., which is bowing out of the struggle to keep the genre relevant.
The recession and online competition have left magazines and newspapers in general struggling to hang on to advertising revenue and circulation, but newsweeklies such as Newsweek, Time and U.S. News & World Report have a particular challenge finding a niche. Once useful digests of the week’s events, newsweeklies now have to compete for attention with up-to-the-second online news and commentary from all quarters.
Newsweek has been piling up losses for the past two years. It cut costs through voluntary buyouts that have reduced its staff by about a quarter; it ended 2009 with 427 employees. And it tried to better compete with more upscale magazines such as the Economist and the New Yorker with a complete redesign of its print and online editions last year.
Neither step has done enough. The Post Co. said Wednesday it has retained the investment bank Allen & Co. to help find a buyer for the magazine.
“Newsweek‘s staff has been remarkable in cutting expenses and putting out a great magazine,” said Post Co. chairman Donald E. Graham. “But we did not see a path to sustained profitability within the company.”
Jon Meacham, the magazine’s editor, said he is exploring every option for keeping Newsweek afloat, even the possibility of forming a group of backers to take it over.
While the Post Co. said it has no deadline for a sale, the company would not comment on what would happen if no buyer steps up.
The magazine launched a redesign last year. It changed its layout to make navigating its pages easier, left more room for its big-name columnists and focuses more on in-depth features rather than recounting the week’s events.
While circulation for the magazine’s domestic edition was more than three million through the 1990s, it declined to 2.3 million last year. And for this year, Newsweek is promising advertisers a circulation of just 1.5 million. It is difficult, though, to pin down exactly how the magazine’s readership has held up; Newsweek says it has voluntarily reduced the numbers to cut down on what it considered unprofitable circulation.
Survey data from Mediamark Research & Intelligence shows the magazine’s overall audience declined from more than 21 million in 2002 to fewer than 17 million last year.
With ad revenue falling across the industry, Newsweek expects its losses to continue this year. It did not reveal specifics; results from the first quarter are due Friday.
Newsweek sold about 26% fewer ad pages in 2009, according to the Publishers Information Bureau; that is consistent with the industry average.
