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Newsweek is for sale: Washington Post Co. puts magazine on the block

Image representing Donald E. Graham as depicte...

Image via CrunchBase

UPDATED at 12:32 p.m.:

The Washington Post Co. announced this morning that it has hired Allen & Co. to seek buyers for Newsweek magazine, the money-losing newsweekly that The Post Co. has owned for decades.

Quoting from the company release:

The Washington Post Company (NYSE: WPO) announced today that it has retained boutique investment bank Allen & Company to explore the possible sale of Newsweek magazine. The newsweekly was launched in 1933 and purchased by The Washington Post Company in 1961. Newsweek is an internationally known and respected publication, providing unique news, commentary and insight into political and social developments in the United States and around the world.

“The losses at Newsweek in 2007-2009 are a matter of record. Despite heroic efforts on the part of Newsweek’s management and staff, we expect it to still lose money in 2010. We are exploring all options to fix that problem,” said Donald E. Graham, chairman of The Washington Post Company. “Newsweek is a lively, important magazine and website, and in the current climate, it might be a better fit elsewhere.”

In an interview with my colleague Howie Kurtz, Graham (pictured) said "The staff of Newsweek has been unbelievable, both on the quality of the magazine and getting costs down." But the losses are a "continuing frustration," especially on the digital side, where Newsweek made only $8 million last year, he said.

"We're going to listen to any and all expressions of interest," Graham said. "We'll try to find a quality buyer," one who will operate "in the best interests of the people who work here."

Asked if it was a difficult call to sell the magazine bought by his father, Graham said: "Yes. It was a hard decision for me, but it's a lot harder for the people who work here."

Graham said surveys show that "the magazine is very popular with its readers," but that "2009 was the worst year for advertising since the Great Depression, and Newsweek is no exception."

In an address to Newsweek staffers in New York this morning, Graham said The Post Co. sees no "path to continuing profitability under our management."

He added: "If anyone should take the blame for this ending, it is me—for not seeing early enough and reacting in the right way to the changes that have come to our industry. But as a former member of this staff, I will always be proud to have been part of Newsweek "

Post Co. vice president Ann McDaniel told Newsweek staffers: "I suspect you might be asking yourself, what if there isn’t a buyer. I believe there will be. The Philadelphia Inquirer just sold for tens of millions of dollars. But if you think my confidence is misplaced, know this: Every one of you will get a job offer" or severance benefits. She added that "no deal is imminent" and Graham said he hopes to execute "a rapid sale to a qualified buyer."

Former Post editor Ben Bradlee, who worked for Newsweek before he came to The Post, proposed that then-Post publisher Phil Graham buy Newsweek to increase its foreign footprint and diversify its journalism. Click here to read a good history of the deal.

In an era when news moved much slower than today, it was not a liability to own a publication that had both the words "news" and "week" in its title. Today, however, even daily newspapers seem stale. And Newsweek, like all other newsweeklies, has struggled with declining readership and revenue in the print magazine. To keep the magazine fresh, Newsweek, also like the other newsweeklies, has built out a robust online presence. But because online advertising is still worth only pennies on the dollar compared to print advertising, the online sites have not paid the bills for newsweeklies. U.S. News & World Report has gone almost exclusively online.

In 2009, The Post Co.'s magazine division, which includes Newsweek, lost $29.3 million after losing $16.1 million in 2008.

Newsweek editor and author Jon Meacham undertook a redesign of the magazine last year. In an interview, he said:

"We will be engaging, in depth, and tethered to the news but not trapped by it," Meacham said. "Our goal was not to scramble around getting little mentions of things that were in the news. A key part of this process is putting out the magazine that only we would want to read and not pretending that the generic reader out there needs a remedial course in current events."

"I hesitate to compare it to other magazines just because this is Newsweek and what we want to do," he said. "I love The Economist, I love the New Yorker, I love Time magazine, I love the Atlantic — I admire all of those editors and all of their staffs, but I just think in a country of 307 million people, in a globalized age, there's room for a lot of different voices and I think we need a lot of different voices. And we're going to be one of them."

Meacham is co-hosting a new PBS show that will replace Bill Moyers' long-running show.

In an interview with Kurtz, Newsweek columnist Jonathan Alter, 27-year veteran, said: "I think it's sad. People need to be cautious about speculating too much about our future. I hope we have a public-spirited buyer who respects good journalism and with the right kind of Web strategy that we can start prospering again."

"Everyone knew we were in trouble, but it was surprising that it came now," he added. "The Graham family had a great run with this magazine, 47 years, and they produced huge amounts of great journalism."

Several staffers faulted the redesign, which emphasized opinion and analysis at the expense of the week's news. Said one person close to the situation: "They destroyed in five years what it took decades to make by a series of mistakes, the last of which was trying to turn the magazine into the New Republic. They lost sight of what a news magazine is, something that gives you the whole world."

Newsweek is set to unveil its Web site redesign this week.

Follow me on Twitter at @theticker.

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By Frank Ahrens  |  May 5, 2010; 12:32 PM ET
Categories:  Corporations , The Ticker  | Tags: Allen & Company, Donald E. Graham, Magazine, Newsweek, United States, Washington, Washington Post, Washington Post Company  
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Comments

I'll give you $75 for it.

Posted by: ravensfan20008 | May 5, 2010 11:00 AM | Report abuse

You are going to have to throw in a happy meal toy to get anyone interested in this one.


.

Posted by: 37thand0street | May 5, 2010 11:02 AM | Report abuse

It has gone down hill because of the elite liberal editorial content that the country as a whole is not interested in reading. If that presented more of a cross section and balanced editorial content, it would get a better reception. I used to subscribe but dropped it due to the determined liberal bias of its' editorial content. Hopefully they will just close it down.....it is a poor asset and I can't imagine anyone wanting to invest in it.

Posted by: jnorow | May 5, 2010 11:04 AM | Report abuse

LOL. Good luck with that.

Posted by: thebump | May 5, 2010 11:09 AM | Report abuse

It is really sad that the Newsweek brand could not transition onto the web.


However, one must remember - the newsmagazines had a niche : it was further in-depth analysis that the newspapers did not want to give in their dailies.

Well - with the web, the newspapers can publish in-depth analysis - and leave it up on the web all week.

Also, web users want their news immediately - they don't want to wait for the morning paper - and they certainly don't want to read news a week later.

Given that dynamic is gone forever, newsweek needed to move onto the web and thrive.

Let's take the Washington Post - it is almost as if the Post survived the move to the web because its readers went there - and the paper was forced to follow its readers.

That is just an impression.

Papers have to make money off of advertising on the web -


No one wants to pay for web browsing - they want to flip from site to site - and they don't want to worry about paying for the 10 different sites they go through.

I don't believe newspapers were making that much money off their subscriptions anyway - given the delivery and printing costs.


After all, the papers SAVE the printing and delivery costs when a user is on the web - so the loss has to be much smaller.

I think the problem has been the newspapers have had a difficult time moving their advertisers over to the web.

Well - that has to be done. I don't understand what the challenges are there.

.

Posted by: 37thand0street | May 5, 2010 11:17 AM | Report abuse

If "liberal editorial content" dooms Newsweek, then explain U.S. News.

Posted by: mattintx | May 5, 2010 11:17 AM | Report abuse

So, Mr. Hiatt, how is that NeoCon thing working out for you?

Posted by: AxelDC | May 5, 2010 11:19 AM | Report abuse

its a shame, but hard copy is dead and the internet is the new medium for news and information.
Newsweek was a little too slow to read the writing on the blogs and adapt.
the last standing publications will be those that are heavily subsidized because they are propaganda for someones agenda.
the hardcopy editions for all the free and independant publications will die a slow painful death.
journalist students will have to be taught that to get a job, you need to be an operative who pushes one side of the story for your idealogue boss.

Posted by: MarilynManson | May 5, 2010 11:20 AM | Report abuse

LOL

Newsweak, the alternative universe support magazine...where the loser left is always right and the right is always wrong....and it cannot earn a buck with its content.....HAH!

Reality always bites the left's pc narrative in the butt

Posted by: georgedixon | May 5, 2010 11:22 AM | Report abuse

As a long time subscriber I think Newsweek made a mistake by emphasizing opinion and features and skimping on attempts to write about what's actually happening in the world. Opinion and commentary have their place, but I'd like to know what's going on. The notion that events matter less after a day or a week is plainly false, but it seems Newsweek has surrendered to that notion.

Posted by: ikeaboy | May 5, 2010 11:24 AM | Report abuse

It is the most extreme of the left wing journals......There is one one conservative contributor and he is just a once in a while writer... that being George Will.. Left wing authors, books and pundits don't do well at all. MSNBC vs. FOX as an example.The New Republic has lost money just about every month since it started publishing..My point is that the interested buyers will be limited. Perhaps a good combination would be for MSNBC to buy it. The magazine supplies most of it writers to the "Keith Olbermann" show, so those guys need to remain gainfully employed somewhere..

Posted by: james_m_reilly1 | May 5, 2010 11:28 AM | Report abuse

I agree with ikeaboy. NEWSWEEK lost its way when it cut back on news in favor of commentary. I am amused by the comments about its liberal content. Have you read it lately? It has tacked so far to the right that it is unreadable. TIME is the better choice these days. Never thought I would type those words.

Posted by: pirate1 | May 5, 2010 11:34 AM | Report abuse

TIME and NEWSWEEK cannot compete with cable news and the internet. It is time to bury them.

Posted by: ravitchn | May 5, 2010 11:47 AM | Report abuse

I have a ton of unused airline miles. Can I buy Newsweek using them?

Posted by: maggots | May 5, 2010 11:52 AM | Report abuse

I might mention that there are plenty of conservative print media, such as US News & World Report, Fortune, Barrons, and the Washington Times, that are struggling right now. Even the Wall Street Journal is only marginally profitable.

It is all readers, not just liberals, who are turning away from magazines and newspapers.

Posted by: maggots | May 5, 2010 12:06 PM | Report abuse

Possibly nothing Newsweek could have done would have prevented its obsolescence in view of the new media age, but certainly its recent conversion into just one more element of the left-wing echo chamber has hastened its crisis. There may be a rich guy who is prepared to subsidize Newsweek as a vanity project (that's what's kept The New Republic, U.S. News and The Atlantic afloat). Or there may not. At this point in Newseek's evolution, its demise would be no great loss.

Posted by: Rob_ | May 5, 2010 12:08 PM | Report abuse

Having tried on-line for several years, I was very happy to get my hard-copy newspaper back. It is beautiful and the ink-on-paper technology is more calming to me, as computers fail so often, one gets a certain anxiety that they will fail.

What I miss the most about newspapers in the 1990s and earlier are the classified ads. It is very difficult to either advertise or read ads now, because there are so few. This makes it more difficult to find housing, employment, merchandie, as the Internet sources are so various.

Good reporting is always appreciated, even the next morning or next week. The author is wrong that reading this morning about the terrorist arrest or oil spill is stale and old.

Posted by: pptcmember | May 5, 2010 12:13 PM | Report abuse

The usual wingnut trolls. Newsweek was part of the Iraq war cheerleading party and had plenty of Mccain fanboys. Newsweek has always been more erratic than Time, but the quality of the writinga dn research has setadily declined over the last 10-15 years. The willingness to act as stenos for Ken Starr was a low point, but things never really recovered.It's been sad to see Evan Thomas' deterioration as a writer. he seems far less of an idiot in person (I've seen him at Politics and Porse author events). Perhaps a new corporate culture could elevate Newsweek from the to whichdepths that WaPo has been going. OTOH, the changing nature of media may mean that Newsweek (and US News) have become redundant.

Posted by: thebuckguy | May 5, 2010 12:15 PM | Report abuse

I canceled my Newsweek subscription after more than a decade not because I get my news on line but because Newsweek had devolved from a true news magazine to infotainment cotton candy. I now have a subscription to a different weekly, one that still reports news and doesn't even mention the latest pop-tart scandal.

Posted by: phal4gal | May 5, 2010 12:16 PM | Report abuse

Put it on eBay.

Posted by: wesatch | May 5, 2010 12:20 PM | Report abuse

Newsweek has continually peddled condescending liberal talking points that no one but the far left would be interested in reading. I wouldn't give you a dollar for it. Hope it goes under with MSNBC and the New York Times. The Liberal elite just doesn't get it and I'm pretty sure they never will.

Posted by: gorams1 | May 5, 2010 12:28 PM | Report abuse

Uh, bailout?

Maybe the liberal journalists at Newsweek can all work in the Obama White House press office. Talk about saving jobs!

Seriously. Newsweek failed in its current format because there are too-many liberal cheerleading news outfits that cover the same topics the same way again and again and again. Gay marriage good, guns bad, Afghanistan good, Iraq bad. Solar power good, oil drilling bad. How many liberal news outfits do you need saying the same thing over and over and over again?

Posted by: RaiderDan | May 5, 2010 12:52 PM | Report abuse

One way to turn this junker around might be for a conservative group to pick it up for a song and turn it to the right.

Posted by: habari2 | May 5, 2010 12:55 PM | Report abuse


I was in Books-A-Million the other day and just marveled at the wall-length magazine rack.

Posted by: blasmaic | May 5, 2010 12:59 PM | Report abuse

The very idea of a weekly news magazine is "so last century" as to be laughable. This is especially true since they have become so over priced and filled with ads. If daily newspapers are going out of business due to lack of interest, how much more so for weekly news magazines!

Posted by: Jihm | May 5, 2010 1:28 PM | Report abuse

Newsweek, Time and U.S. News and World Report should fold. Along with the Washington Times.

Posted by: jckdoors | May 5, 2010 1:29 PM | Report abuse

In the Washington Post Co. annual report, Don Graham described last year's redesign of Newsweek as "as disaster." Selling the pub. is no surprise. No one would pay more than 10-15 mil dollars for it, though.

Posted by: axolotl | May 5, 2010 1:30 PM | Report abuse

In this day and age, a newsweekly is irrelevant to say the least.

Posted by: adrienne_najjar | May 5, 2010 1:31 PM | Report abuse

Post co vp Ann McDaniel may not realize the Philadelphia Inquirer was sold last week to its CREDITORS for $139 million. That is not the same as A Buyer wanting a valued newspaper or magazine.

Posted by: knitgrl | May 5, 2010 1:31 PM | Report abuse

In the WaPo Co. annual report, the chairman of the board described the redesign of the magazine last year as "a disaster." The sale is no surprise.

Posted by: axolotl | May 5, 2010 1:32 PM | Report abuse

Who wants to read liberal opinion pieces? We get enough of those from Team Obama and Queen Pelosi!

Posted by: wheeljc | May 5, 2010 1:38 PM | Report abuse

Meacham: "A key part of this process is putting out the magazine that only WE would want to read.."

Translation: Since nobody reads our magazine anyways or notices that we have no "news" staff, let's go into irrelevancy with a glorious kamikaze dive!

Posted by: gerbils | May 5, 2010 1:55 PM | Report abuse

Not sure I understand the arguments that Newsweek has hung a right turn on the political spectrum, unless it occurred since I started typing this sentence. Do you mean Newsweek is "right" only in the sense it is slightly to the right of the extreme left wing of the Democrat party? Because even a cursory review of the Politics menu at newsweek.com reveals the following article themes:

http://www.newsweek.com/id/38584

-- Tea Party now irrelevant in Indiana
-- How Obama can balance gender on Supreme Court
-- Future of abortion-rights movement
-- "The case for Secretary Janet Napolitano as a Supreme Court Justice"
-- Why are conservatives so worked up over the VAT?
-- Tea Partiers are a bunch of racists
-- This astroturfed "Coffee Party" is pretty awesome

Even in the ostensibly less patronizing "Nation" section, we're treated to articles with themes such as:

-- Total elimination of nuclear weapons
-- Article comparing today to events surrounding 1995 Oklahoma City bombing, including "GOP rhetoric" and crazed "enemies" of Obama's placid, super reasonable middle-of-the-road policies
-- Why men love war
-- Earth Day 40th anniversary article lauding "collective action" over individual choice, including assertion that "[a]ll environmental progress has come through national- and international-level regulation—to be blunt, by forcing people and industry to stop doing environmentally bad things and start doing environmentally good things, not by relying on individuals' green good will or even the power of the marketplace."

In short, the occasional "conservative" article on Newsweek amounts to a unicorn sighting in which an editor apparently let a nod to capitalism or America's enormously positive impact on the world slip through by accident. In related news, the above article list might, just might, be a noteworthy factor in Newsweek's massive losses and proposed sale. I wonder if the progressive geniuses involved have any sense of the irony of the market dictating they should lose their jobs even as they shamelessly laud Obama's imaginary economic accomplishments.

Posted by: zippyspeed | May 5, 2010 2:11 PM | Report abuse

YOU PUT AN EGGHEAD IN CHARGE OF THE RE-DESIGN. NOW YOU HAVE SCRAMBLED EGGS.

Posted by: DANSHANTEAL1 | May 5, 2010 2:15 PM | Report abuse

Newsweek: Not worth the paper it's written on! Save the trees!!! Employees are better off looking for new jobs!!!

Posted by: SeniorVet | May 5, 2010 2:28 PM | Report abuse

Another rag bites the Dust GREAT!

Posted by: american1 | May 5, 2010 2:46 PM | Report abuse

Washington Post selling Newsweek is like a pimp with a cold sore and crabs offering to sell a dead prostitute.

Posted by: Cornell1984 | May 5, 2010 3:14 PM | Report abuse

It's a shame to see this happen to a once great magazine that has faithfully chronicled the scene since the 30's. Newsweek set the standard for covering US elections, but has struggled with its identify for some time now, from wallowing in OJ to last year's foolish redesign and rather obvious (tho not out of mainstream) leftish tilt (I'm a proud progressive Democrat and Obama supporter, but let's be honest here, and leave "don't confuse me with the facts" defenses to the Tea Partiers; the increasingly sloppy George Will hardly provides a balance). Hopefully a new owner will realize that it makes no sense to do a "lite" opinion and news magazine (or newspaper) that simply replicates web news. Meachum's dead wrong--the very purpose of a good weekly newsmagazine is in fact to summarize the news to give us a decent perspective on it. I have to go to the Economist for that now.

Hopefully NW will avoid the fate of "Life" magazine, for those of you who remember its glorious heyday...

Posted by: BABRAD | May 5, 2010 3:30 PM | Report abuse

zippyspeed- good for you to use actual articles, commentaries. I finally gave up on Newsweek this year after reading a column about the Duke lacrosse "rape victim's" latest arrest, and how she wasnt such a bad sort, just had a bad upbringing, and they shouldve prosecuted the (innocent)boys anyway. In short, the usual strident and predictable bleeding-heart hogwash.
Other than Drs waiting-rooms I cant even recall the last time i saw a newswwek, or TIME, for that matter.

Posted by: peabody2 | May 5, 2010 3:44 PM | Report abuse

Hustler Magazine may be interested.

Posted by: 12oreo | May 5, 2010 3:55 PM | Report abuse

Newsweek's cover "Al Gore-The Thinking Man's Thinking Man" was a very strong indication that Newsweek was on the path to oblivion. That cover probably helped Gore buy that $9 million beachfront mansion in California but only further wrecked Newsweek's credibility.

Posted by: NAuchi | May 5, 2010 3:56 PM | Report abuse

just put it out of it's misery. No one is going to buy it.

Posted by: djrhood | May 5, 2010 4:30 PM | Report abuse

They are all socialists now. Maybe Hugo Chavez will buy it. Did you get the Greekweek memo? File with good while it lasted. Some things last forever and this is not one of those things. Oh well.

Posted by: tossnokia | May 5, 2010 4:40 PM | Report abuse

Newsweeik, like the POST, is a very corrupt liberal/progressive propaganda outlet for the Democrat Party.

It was Newsweek who KNOWINGLY published a lying story about US troop flushing a Koran down the toilet at GITMO.

That LIE cause riots in the Middle East where dozens of innocent women and children die. They died because the liberal/progressives at Newsweek HATED Bush so bad they went to press with a Front page lying story.

The investigation that ensued after that lying story broke found NO evidence of such a thing happening.....

Lets hope Newsweek goes out of business first.......sad

Posted by: allenridge | May 5, 2010 4:48 PM | Report abuse

What is toilet paper going for these days?

Posted by: ItsOver2 | May 5, 2010 5:05 PM | Report abuse

Much higher quality for what it is, a news mag, than the Wa Po, which is plunging to terminal velocity of its journalistic quality.

Posted by: axolotl | May 5, 2010 7:21 PM | Report abuse

Posted by: allenridge
It was Newsweek who KNOWINGLY published a lying story about US troop flushing a Koran down the toilet at GITMO. That LIE cause riots in the Middle East where dozens of innocent women and children die. They died because the liberal/progressives at Newsweek HATED Bush so bad they went to press with a Front page lying story.
--------
Well, if your hero Bush hadn't lied to get us in this war in the first place, then none of this would have happened. Talk about calling the kettle black.

Posted by: dlpetersdc | May 5, 2010 7:27 PM | Report abuse

Posted by: allenridge
It was Newsweek who KNOWINGLY published a lying story about US troop flushing a Koran down the toilet at GITMO. That LIE cause riots in the Middle East where dozens of innocent women and children die. They died because the liberal/progressives at Newsweek HATED Bush so bad they went to press with a Front page lying story.
--------
Well, if your hero Bush hadn't lied to get us in this war in the first place, then none of this would have happened. Talk about calling the kettle black.
=================================

The FACT is Bush didn't lie......the Democrats and their left-wing pals in our MSM wolfpack press lied and mislead the American people.

We had bi-partisan commissions investigate this
We had partisan commissions investigate this
We had Blue-ribbion commisions investigate this
And we had the 9/11 commission investigate that charge........

ALL of them can up with the same results......NO PROOF...

Now dlpetersdc if you have the PROOF then please post it because we have been looking for that proof for years.

Otherwise you can stop repeating that LIE....... and that's exactly what it was, a LIE.....

No Downing Street memo's.......

No secret Daily Presidential Briefing......

NO PROOF............just a LIE that has been repeated over and over again.

Welcome to NAZI America...dlpetersdc your Party and heros are in charge......

Posted by: allenridge | May 5, 2010 7:38 PM | Report abuse

One-sided magazines have their place, and it's a very small place. Newsweek made the fatal error when it turned liberal. Too bad short-sighted management wrecked a once great magazine.

Posted by: kls1 | May 5, 2010 9:09 PM | Report abuse

One-sided magazines have their place, and it's a very small place. Newsweek made the fatal error when it turned liberal. Too bad short-sighted management wrecked a once great magazine.

Posted by: kls1 | May 5, 2010 9:09 PM | Report abuse

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Posted by: joanlin73 | May 5, 2010 9:19 PM | Report abuse

The WaPo Co. has one foot in the grave and another on a banana peel.

Posted by: waterfrontproperty | May 5, 2010 11:14 PM | Report abuse

Still puzzled over Thursday? Clues for the clueless. It can get fatal fast. In the absence of positive information, I could still rely on mine. Who can you count on or better still, can you count? Now on to next week.

Posted by: tossnokia | May 7, 2010 6:47 PM | Report abuse

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