Spring Cleaning: Time Warner Tossing Magazines into Separate Unit

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Following a break-off in talks with the Meredith Corp., Time Warner will concentrate on its film and cable tv units and separate its financially beleaguered Time, Inc. magazine unit into a separate entity, the New York Times reported this week.

Reportedly, talks between the two media conglomerates concerning creation of a company that would have combined many of Time, Inc.'s stable of 23 magazines with Meredith's periodicals collapsed because the two sides couldn't agree on the fate of Time, Inc.'s London-based IPC Media and over Meredith's lukewarm interest in Time's flagship magazines, Sports Illustrated, Fortune, Time and Money, according to the Times article.

Arithmetic is the motivation for the Time Warner decision, as in the Fourth Quarter of 2012, Time, Inc. suffered a 7 percent loss in revenue to $967 million, while over the same period, Time Warner's cable holdings gained 5 percent in revenue to $3.67 billion. Time, Inc., the nation's largest magazine publisher, said last month it would pare its 8,000-member workforce by 6 percent (see "TUOL" post 1/31/13).

Declining advertising revenues and shrinking circulation have plagued the magazine industry overall, as this ever-modest blog first reported rumblings by Time Warner about disgorging its red-ink pumping magazine units four years ago (see "TUOL" post 9/28/09).