Bloomberg L.P. is ‘totally committed’ to print
Justin Smith has been taking a close look inside every nook and cranny of Bloomberg Media Group since becoming chief executive officer of Bloomberg L.P.'s consumer-facing division roughly four months ago.
He set up his desk on the fifth floor of the company's Lexington Avenue headquarters, home of Bloomberg L.P.'s troubled television operation, Bloomberg TV, which is seen as the project that will require the most attention.
But Smith has his eye on the magazine stable, too, and he has considered the possibility of reducing the frequency of its star player, Bloomberg Businessweek, according to sources familiar with his thinking.
It's a strategy being pursued by another tony weekly, New York, which announced in December that it will drop down from 42 issues per year to 26 beginning in March. Similarly, Advertising Age, a trade publication, revealed earlier this month that it will reduce its frequency to 25 issues per year. (Both titles cited digital growth when they rolled out the news.)
Sources with knowledge of the matter said that Smith and Bloomberg Businessweek editor Josh Tyrangiel have indeed had discussions about what sorts of things they might do differently with the magazine, but that there are no plans to scale it back from being a weekly.
Tyrangiel, who's been on a semi-hiatus from the magazine while temporarily assisting Smith with a revamp of the company's TV strategy, declined to comment. Smith told Capital through a spokesman that there are 49 issues slated for Bloomberg Businessweek in 2014.
Bloomberg Media—which also includes bloomberg.com, online home of the flagship financial wire Bloomberg News; the online opinion offering Bloomberg View; and two other print magazines: Bloomberg Markets and Bloomberg Pursuits—is "going through an extensive strategy review process, and it’s ongoing," said Smith. "Quality print resonates with readers and we remain totally committed to the medium including the weekly publication of Bloomberg Businessweek."
Founded in 1929 and given a much-needed facelift when it was acquired by Bloomberg L.P. in 2009, Businessweek has been narrowing its losses over the past several years by delivering a consistently sharp, smart and well-designed product week after week that has vastly increased its sex appeal among media insiders and Wall Street wonks alike.
But the magazine still loses a decent chunk of change, second only in the Bloomberg Media empire to Bloomberg TV, sources said. Three insiders estimated that its losses in 2013 were between $18 million and $21 million, down from the $62 million it was on track to lose when Bloomberg L.P. bought it more than four years ago.
Bloomberg Businessweek's ad revenue was down 9.5 percent in 2013 to around $200.76 million, according to the Publishers Information Bureau. Total average circulation for the first half of 2013 was just about flat year over year at 990,683, while newsstand sales were down 6.3 percent, according to the Alliance for Audited Media.
But within an institution that derives the lion's share of its revenue from lucrative subscriptions to its trademark financial terminals, the magazine is just as much a prestige play as it is a business.
Michael Bloomberg, the company's founder and majority shareholder, who recently returned to day-to-day operations following a 12-year term as mayor of New York, reiterated his commitment to Bloomberg Businessweek during a meeting last week with the magazine's staff. He told them that he plans for the magazine to be on the newsstand for a long time to come and that purchasing it was one of the best things the company had done in his absence, according to people who were present.
Likewise, these people said, Smith gave the magazine a resounding vote of confidence during the meeting, telling the assembled employees that Businessweek was one of the main reasons he left his job of six years at Atlantic Media to join Bloomberg L.P. last fall.
At Atlantic Media, Smith was seen as more of a digital champion than a nostalgist for its venerable print title, The Atlantic. And the company claimed a return to profitability as it expanded its digital footprint under his watch.
Insiders are expecting more of the same from Smith at Bloomberg L.P., which is aiming for growth in its media properties amid a slowdown in the core terminal business.
"I think the coins are going to go into digital and away from the magazines," one of them predicted. "The strategy is to be digital first."
But it will take time.
"He hasn't really had an impact yet," another source said. "But there are definitely a bunch of people inside the newsroom that are really excited to have him."