WWD.com/media-news/fashion-memopad/memo-pad-changes-at-the-top-news-international-to-close-magazines-division-1553168
fashion-memopad
fashion-memopad

Memo Pad: Changes At The Top... News International To Close Magazines Division...

Traditional media companies are in existential crisis, as Wednesday's high-level executive changes at Hearst Corp. proved.

fashion-memopad/news
CHANGES AT THE TOP: If anyone needed convincing that traditional media companies are in existential crisis, Wednesday's high-level executive changes at Hearst Corp. and Hachette Filipacchi could be further proof. Victor Ganzi, Hearst's president, chief executive officer and director, resigned after six years of leading the parent of Hearst magazines. His predecessor and vice chairman of the Hearst board, Frank A. Bennack Jr., will serve as interim ceo. At Hachette Filipacchi, Alain Lemarchand, a senior vice president of operations at French parent Lagardère Active Media, will replace ceo Jack Kliger, who assumes the newly created title of chairman working on "strategic relationships for the company" with no apparent portfolio.

Ganzi's exit after a total of 18 years at Hearst surprised observers for its abruptness, as did a press release citing "irreconcilable policy differences" with the board of trustees regarding the future of the company. He is thought to have recently lost the board's support. The board has created a search committee to find a replacement. Observers said Ganzi's departure is particularly noteworthy given the traditional longevity of Hearst ceo's.

Ganzi did not return calls, but said in a statement: "It has been an honor leading this company and working with such talented people throughout the organization....Based upon 15 record profit years out of the last 16, Hearst is well positioned to extend its leadership in the media industry in the future. I will work with the company to ensure an orderly transition of leadership."

While a spokeswoman said it is too soon to discuss a successor, that isn't stopping some from speculating whether Hearst Magazines president Cathleen Black will be a candidate and possibly will be succeeded in her current post by Michael Clinton, executive vice president, chief marketing officer and publishing director. Sources pointed out that Hearst rarely brings in outsiders in senior positions, generally preferring to promote insiders.

At Hachette, Kliger's exit after nine years was long predicted. He was recently honored by the Magazine Publishers of America with a lifetime achievement award. (He was chairman of the MPA at the time the organization revealed plans to give him the award. He used his term to champion audience-based, rather than circulation-based, magazine measurement.) His reputation for hard drive and bluster is typical of a certain disappearing era of magazine publishers. For example, in the tribute video for his lifetime achievement award, former colleague David Carey (now a publishing director at Condé Nast, owner of WWD) described him as "the big imposing Jack Kliger, who ruled over the Four Seasons and industry trade shows like the great king that he is."
Kliger's tenure was marked by magazine closures (George, Ellegirl, For Me, Premiere, Shock), of which some were considered inevitable and others controversial. In the case of Ellegirl and Premiere, the company touted transitions to online-only properties, though their online afterlives tended to be bare bones. And, while Hachette's fashion flagship, Elle, has been posting good numbers and gaining more attention, its high-profile partnership with "Project Runway" is likely to end, the company's shelter and automotive groups are particularly vulnerable to the current economic downturn and the company is still finding its way digitally, as seen in recent layoffs and executive changes. "I think he saw this coming for a while, although the timing probably caught him off guard. He was likely forced to go along with it, to ensure anything he would receive financially," speculated one insider.

The selection of Lemarchand as Kliger's replacement rather than an American may indicate that the company is taking an even more active role in the U.S. division, its second-largest revenue contributor.

— Irin Carmon and Amy Wicks

NEWS INTERNATIONAL TO CLOSE MAGAZINES DIVISION:
News International, Rupert Murdoch's British newspaper business, is set to close its consumer magazine division, called News Magazines, a spokeswoman in the U.K. said Wednesday.

"We can confirm that we will disengage from the magazine business," she said. "It will allow us to focus on our core business as the U.K.'s largest national news publisher."

On Tuesday, London trade magazine Media Week reported that News Magazines had made a loss of 9.7 million pounds, or $18.9 million, in the year to June 2007, but the spokeswoman declined to confirm that figure.

The division published three magazines — the real-life magazine Love It, the Sunday Times Travel and Skymag, a magazine for Sky Television's customers. The spokeswoman said the company planned to sell Love It, while the Sunday Times Travel will be published from News International's newspaper headquarters. The spokeswoman said it was a possibility that Sky Magazine could be published in-house by the television channel, but that had not been confirmed.

— Nina Jones