Time Inc. to Cut $100 Million; Extensive Layoffs Are Expected (Dinosaur Media DeathWatch™)

The New York Times ^ | October 29, 2009 | Stephanie Clifford

[abb]

Signaling that worse times are ahead for magazines, Time Inc. is expected to announce next week that it will cut $100 million from costs, including another big round of layoffs.

The timing is coordinated with parent company Time Warner’s third-quarter earnings announcement, sources said, scheduled for Wednesday morning.

Time Inc., the publisher of titles like Time, Fortune, and People, has already cut costs dramatically: a year ago, it announced it was dismissing 6 percent of its work force, or about 600 people.

That was apparently not enough to make up for revenue declines. The $100 million in costs is expected to come largely from layoffs, said sources, who asked to remain anonymous as they were not authorized to discuss the matter.

Michael Nathanson, an analyst at Sanford C. Bernstein & Co., said he expected that third-quarter revenue at Time Inc. would fall about 19 percent, to $900 million.

“For the year, we’re at about $3.7 billion, and this company had done almost $5 billion as late as 2007,” Mr. Nathanson said.

Since 2004, Time Inc. has cut about $800 million in costs, Mr. Nathanson said.

Overall, Mr. Nathanson said, he expects Time Warner to post earnings of $0.54 cents a share, well up from the $0.30 a share it posted in the third quarter of 2008.

Time Inc. has already been slashing costs over the last several years. Since 2007 it has shut down titles including Business 2.0, Cottage Living, Southern Accents and Life, which it had revived as a newspaper supplement. Last week, Fortune announced that it would no longer be biweekly, and would drop its frequency from 25 to 18 issues a year. A stricter expense-account policy has been in place for some time, and some magazines have decreased the weight of the paper they use.

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[pepsionice]

I had a friend who made six to eight trips to the doctor each year...same doctor...for well over ten years. Somewhere along last year...he came in and noticed that of the eight magazines in the waiting area...all were of some travel or scenic nature type. Both Time and Newsweek had gone...along with Readers Digest. As he was leaving, he commented on this to the receiption gal who he’d known for the majority of the ten years. She smiled and said that she felt these were ‘less stressful’ than these funny news magazines.

I’m guessing that alot of people have gotten to the point of just managing Time and Newsweek into non-existence...without much effort.

[Kozak]

Can’t die soon enough for me. Once upon a time I had a subscription to both Time and Newsweek. As they became an endless commercial for the DNC and the left I stopped even picking up the occasional copy at the news stand.