Battered by a one-two punch of declining readership and ad pages, Newsweek magazine is getting an extreme makeover this year that will include a large circulation reduction, deep cuts in operating costs, and a new effort to attract advertisers by concentrating on an elite audience.
According to The New York Times, executives at Newsweek say the retooled magazine will focus on being a "thought leader" that focuses on telling readers how to think about news, rather than telling people what happened in the last week. The plan, similar to the editorial outlook espoused by The Economist magazine, is aimed at helping the newsweekly better compete in the face of competition from cable TV and the Internet. The transformation will likely include more analysis, commentary, and news-related feature articles.
“We’re not in the business of telling people the news,” Richard Stengel, managing editor of Newsweek's rival Time, told the Times. “News has become a commodity. They already know the news.”
Weekly newsmagazines have been struggling recently, according to the Times: Magazine advertising pages fell 11.7 percent in 2008, and industry analysts predict that 2009 will be worse. Of the big three magazines (Time, Newsweek, and U.S. News & World Report), only Time has a robust bottom line. Time's profit in 2008 was nearly $50 million -- but even that was partly due to serious cut-cutting measures. Time and Newsweek each reported about one-third fewer ad pages in 2008, compared to 2004. The magazines have slashed their editorial staffs to the point where they're about half as big as they were in the 1990s. They also have closed many foreign bureaus.The Washington Post Co. admits that its magazine division, which includes Newsweek, had an operating loss of $27 million on $176 million in revenue in 2008. In 2008, U.S. News went from publishing weekly to biweekly and then to once a month. It also lowered its guaranteed circulation rate for advertisers from 2 million to 1.5 million. Newsweek lowered its guaranteed circulation rate for advertisers from 3.1 million to 2.6 million in 2008. Industry experts expect it will drop under 2 million by 2009. Time lowered its guaranteed circulation rate for advertisers from 4 million to 3.25 million in 2007.
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