Newsweek Deadline Draws Near (Chris Ruddy may bid - Dinosaur Media DeathWatch™)

The Wall Street Journal ^ | May 29, 2010 | Russell Adams

[abb]

A private-equity firm and a publisher of a right-wing magazine are among prospective buyers expected to enter the first round of bidding for Newsweek magazine.

OpenGate Capital, the investment firm that owns TV Guide, plans to formally declare its interest in acquiring Newsweek before Wednesday's deadline for nonbinding bids, according to managing partner Andrew Nikou. Christopher Ruddy, publisher of the conservative monthly magazine Newsmax, said he also plans to bid.

Thomson Reuters Corp. is unlikely to submit a letter of interest by next week's deadline, but the financial news and information company could partner on a bid later in the process, according to a person familiar with the company's thinking. Media mogul Haim Saban initially expressed an interest, but it is unclear if he will enter the fray. A spokesperson for Mr. Saban declined to comment.

Meanwhile, Bloomberg LP, Fast Company publisher Mansueto Ventures and Mort Zuckerman, owner of U.S. News & World Report, all said they are not interested.

Newsweek owner Washington Post Co. recently said it would try to sell the unprofitable magazine and hired Allen & Co. to shop it. The investment bank has circulated a summary of Newsweek and details about the bidding process, which requires prospective buyers to submit a purchase price and financing plan by 5 p.m. EDT Wednesday.

Post Co. indicated in the summary sent to potential buyers that the company would assume all long-term employee-related liabilities, including pension and retirement obligations, as of the sale date. It also indicated in the summary it will assume "certain" severance obligations. A person familiar with the matter said Post Co. has offered to cover severance costs for up to 200 Newsweek employees not retained by the new owner. Newsweek has 379 full-time-equivalent employees.

snip

[Zakeet]

From: Newspapers now have lost half of core sales

The decline in newspaper advertising eased in the first three months of 2010, but the industry exited the quarter with less than half the revenue base it had in the same period in 2005.

Print ad sales for the industry skidded 11.4% in the first three months of the year to $5.2 billion, according to data released yesterday by the Newspaper Association of America. This compares with $10.3 billion in the same period in 2005, reflecting a decline since then of 55.3%.

While the sales slide in the first period of this year was not as severe as the 29.7% dive in the same quarter a year ago, it nonetheless ranks as the third worst Q1-setback setback on the books. The long-term print revenue trend is illustrated below.

[Snip]

The first-period plunge marked the 16th consecutive quarter of declining print ad sales – a trend that commenced, significantly, in April, 2006, or well before the global economy began to crumble.

Print advertising matters because it traditionally accounts for three-quarters of the revenue base at most newspapers, with circulation and digital media making up the rest.

The extent of the long-running decline in print advertising – the core business at every newspaper – can be illustrated by comparing sales in the first quarter of this year with sales for the same period in 2005, when the industry posted all-time high sales of $49.4 billion. Here are the stark results:

As you can see in the table above, the three principal classified categories were hammered the hardest: auto, real estate and employment. While these three verticals were at ground zero in the economic firestorm, the categories are unlikely to recover fully in the future, as advertisers in the respective categories migrate to free or low-priced websites ranging from Craig’s List to Zillow to Cars.Com.

Though hit less than the classified categories, retail and national advertising both have suffered profound contraction.

[Snip]

While print at the moment is far from dead, more than half of newspaper readers are over the age of 50. Because newspapers have failed to attract young readers to the degree they historically attracted their elders, they will have to change almost everything about their businesses if they have a hope of sustaining their valuable franchises.

The less-awful sales in the first months of this year gave publishers the gift of a bit more time to fundamentally reposition their businesses. But there is nothing in the first-quarter numbers to suggest that the storm for newspapers has blown over.

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Personally, I found the above article you referenced to be even more enjouable than the one you posted.

[Oceander]

Hmm, I suppose it's too much to hope that I'll be able to retire this bumper-sticker soon:

[stephenjohnbanker]

“Each morning the maintenance people pick them up and throw them into one of the big blue recycle containers.”

Proper maintenance.

[abb]

It’s really a shame that trees must die to print their garbage.

[stephenjohnbanker]

Maybe not for much longer ;-)

[canuck_conservative]

Good move by Ruddy.

If he actually gets it, just imagine the fun when he tells Eleanor Clift she now has to support Rush Limbaugh and criticize Obama.

[Erasmus]

There was a big stink a couple years ago when several newspapers were found by the ABC (the Audit Bureau of Circulations) to be inflating their paid subscription numbers by including all the freebies and, IIRC, returns.

Maybe some magazines have been doing the same thing.

[abb]

If it weren’t for hotel rooms, USA Today would have to shut down half their press run.

[catnipman]

"The reinvented Newsweek ... has targeted a smaller, more sophisticated audience."

ROTFLOL!

But seriously folks, why would a conservative organization want to buy a rag like this anyway? The brand itself is already poison, the weekly news magazine model is dead (even dailies are publishing day-old news everyone has already seen), and the new owners would have to fire almost everyone in the organization? So what's left? Some commercial real-estate, a giant printing press, and established distribution? Commercial real-estate is collapsing, and there's a rapidly growing surplus of giant printing presses. I guess the distribution contracts might be worth something if you could come up with something that you could sell and make money at, which is extremely doubtful, since print media is dying.

So, I say let some lib organization p!ss their money away on buying this dinosaur!

[Republic Rocker]

Two angles, one markets....... when things get this out of whack those whom step in will win in the long run. Now is the time to buy so many things if you are liquid enough to do so. The other is can you afford to buy something as a ‘wash” but you can gain something from the power that you have. Owning a media outlet such as Newsweek gives you a BIG voice. That may be worth the price alone for Ruddy.

[Grampa Dave]

Even the hair places get the freebies.

[Grampa Dave]

The sick fishwraps and magazines are serial killers of innocent trees across the land.

[BunnySlippers]

That’s silly! If he has the money, he’ll prevail. There is no conspiracy and absolutely not one hint that there is or will be one.

[Joe 6-pack]

"There is no conspiracy and absolutely not one hint that there is or will be one."

No conspiracy? Read Alinsky and/or Gramsci. Listen to recent remarks from Cass Sunstein et al. Control of the media is their very MO, and is a predominant theme of the political philosophers they embrace.

[hecht]

I hope they dump fraulein Eleanor clift

[BunnySlippers]

OK, so who is keeping Ruddy or anyone conservative from buying? Fox News is top of the hill. No one is keeping anyone from starting a newspaper, a magazine or anything.

Some proof would help.

[AmishDude]

All they’re selling, essentially, is the name and copyrighted images. Nobody will keep the writers.

Honestly, I don’t know how anybody can make it work even if it isn’t a newsmag anymore and is just an opinion mag. All of the opinion magazines are subsidized by donors.

[AmishDude]

Actually, I wonder if Ruddy would only be interested in the Newsweek brand for the URL and for the banner for a website.

[Joe 6-pack]

These may give you some insight...

Cass Sunstein's despicable ideas on regulating the internet

Journalists from The Washington Times, along with two other newspapers, who have dared ask penetrating questions have been barred from Sen. Barack Obama's campaign plane.

OBAMA CENSORSHIP; Enforces Fairness Doctrine, BANS TV STATION

Cass Sunstein, Obama's Censorship Czar

Obama’s Media Control Strategy

Obama Teases Print Media Bailout

[abb]

I’ve been saying for years what gave the Dinosaur Media value was their ability to control information distribution. News in and of itself has no value unless you can control when/how it is released. Prior to the interweb thingy, they controlled all that.

They no longer have that power. Presto, the value goes away.