The company that owns the New Yorker and Vogue is bleeding money. A new CEO is supposed to turn things around.
New Conde Nast boss Roger Lynch comes from Pandora and Sling.
Conde Nast is the company behind some of the world’s most glamorous and influential magazines, including Vogue, the New Yorker, and Vanity Fair. It is also a company in decline, because the magazine business is in decline.
Roger Lynch’s job is to somehow stop that.
“It is a difficult job,” he said today, after Conde announced that Lynch, who has no magazine experience, would be the company’s new CEO. “But that’s what attracted me to it. There were other things I was looking at that were more in my wheelhouse, more in my comfort zone, but I like not being in my comfort zone.”
That’s the right thing to say. But it is hard to say what Lynch can do that his predecessor, Bob Sauerberg, hasn’t tried to do during his tenure — or what any of the big magazine publishers, who find themselves in a similar predicament, have tried to do.
The magazine industry is in decline because the magazine industry’s core product — packaging stories and ads and presenting them together in a discrete bundle — is in decline, for an obvious reason: Readers and advertisers are more interested in spending their time and money in other ways.
That’s why Time Inc., perhaps the best-known magazine publisher, recently sold itself at a discount to rival Meredith, which then turned around and started selling off some of Time’s best-known publications, including Time magazine and Fortune.
It’s why a series of high-profile magazine executives and editors, including Vanity Fair’s Graydon Carter — have left their posts in the last few years. (It’s notable that the two highest-profile names who still work in the magazine business — Vogue’s Anna Wintour and the New Yorker’s David Remnick — are employed by Conde.)
And it’s why magazine publishers are willing to try a Hail Mary play with Apple by signing up for its Apple News Plus plan, which sells their titles at a massive discount and gives them a small slice of that revenue, in the hopes that Apple will make up for it with volume.
Conde Nast has tried to adapt for years, primarily by trying to shrink itself via a series of layoffs, asset sales, and shutdowns. Its next big move will be to merge its US business with its international unit, which will inevitably result in more cuts; it’s also in the process of selling off some titles like Brides and Golf Digest.
It’s still hard to see how that will be enough. Conde lost a staggering $120 million in 2017, and I’ve been told the goal for 2018 was to pare those losses to a mere $50 million, which didn’t happen.
Like every other magazine publisher, Conde has also been trying to build out new revenue sources. It is putting paywalls around much of its web content to try to build a digital subscription business, and it has been steadily cranking out videos, and selling ads around those products. It also has an events business, featuring high-gloss gatherings like Vanity Fair’s annual Oscars party, and tries to turn some of its magazine stories into other stuff, like movies and TV shows.
In theory, Lynch has a digital background that makes sense for a modern-day magazine publisher. While his last job was running Pandora for a year and change before the music-streaming service was acquired by Sirius XM, his more relevant experience may be working for Dish Network and helping that satellite TV company launch Sling TV — the first all-digital pay TV business.
The real question is what the Newhouse family, which owns Conde, wants Lynch to do. One option would be to keep cutting away anything that isn’t the handful of Conde magazines you’ve heard of and run that as a boutique portfolio of luxury brands. Another is to bulk up via acquisitions and investments, using the billions of dollars the Newhouses have made by selling off cable TV assets.
A worst-case scenario would be to keep things more or less status quo. On the other hand, if the Newhouses wanted radical change we may have seen evidence of that already.