- Last Updated: 2:42 PM, March 8, 2013
- Posted: 12:38 AM, March 8, 2013
An eerie calm seemed to be settling over Time Inc. yesterday, the first full day when its future as a company untethered from the Time Warner mother ship could be contemplated.
“I’m energized,” said Time Inc. Editor-in-Chief Martha Nelson, who was one of the top execs in the meeting with Time Warner CEO Jeff Bewkes Wednesday after the stunning announcement of the public spin-off of the magazines into a separate company was first revealed.
“I think the whole senior management team sees this as a good thing for the company,” she said.
Bewkes spent more than 90 minutes talking with upper management late Wednesday, when he also revealed that Laura Lang had “asked” out of her CEO job but would stick around for the transition.
Time Inc. is by no means out of the woods. Revenue last year shrank by more than 6 percent to $3.4 billion while its operating profit plunged 25 percent to $420 million.
Jessica Reif Cohen at Bank of America Merrill Lynch was predicting Time Inc. would see another 17 percent decline for operating profit in 2013 — to $384 million.
The problem is ad dollars are increasingly migrating to digital platforms — and through all the upheaval at the top of the company over the past few years Time Inc. has proceeded gingerly, when it has proceeded at all.
Time Inc. was behind most major publishers in embracing the iPad, for example.
Despite Lang’s constant “top to top” meetings — one CEO talking to another CEO — usually inaction followed in terms of deals when action was clearly required.
But yesterday, as the sun dawned on Time Inc.’s new reality, a cautious sense of optimism seemed to be taking hold. The company has good cash flow, and now won’t be shipping it to Time Warner.
“It’s a lighter mood today,” said Nelson. “It may not be an easy path, but it is a clear path.”
The biggest question facing the company in the short haul may be who is going to get the job of CEO.
Despite two straight missteps when Bewkes selected a leader from outside the company, insiders say corporate brass will once again look inside — and outside — for a Lang replacement.
When Nelson was asked who might get the job, she said, “That’s a pay grade above my level.”
Among the inside candidates, there is no clear front-runner.
On paper, Howard Averill, the chief financial officer, would look like the type of executive who could shepherd a company into the public sphere. But many blame him for his role in the 2011 do-nothing triumvirate era when a trio of executives engineered a coup against short-term CEO Jack Griffin.
Executive vice presidents, David Geithner, brother of former Treasury Secretary Tim, and Todd Larsen, are well-respected internal candidates but haven’t run large public companies.
Paul Caine, the chief revenue officer, has also been mentioned but in the current ad-challenged world putting a top ad executive in charge is a tough sell.
But one insider thinks that a standalone Time Inc. might attract a different brand of CEO from the outside.
“Before, you were looking for someone to essentially run a division of Time Warner and report to [Time Warner CEO] Jeff Bewkes. Now someone like Tom Freston might be intrigued by it since he would be the boss. That’s the caliber of guy you are looking for.”
For the record, Freston’s name surfaced last time a search was on, but the former MTV head said he was never contacted about the job.
Time Warner has seemed to have a fascination with Meredith. If they still do, former Meredith CEO William Kerr might be available. He retired from Meredith in 2010 and recently stepped down as the CEO of Arbitron, which was sold to Nielsen for $1.26 billion.
New blood at Lonny
Michelle Adams, the founding editor of hot online shelter magazine, Lonny, is going to step down this spring and will be replaced by Irene Edwards, who was special projects editor at Travel + Leisure and earlier worked at Sunset Magazine.
The 3-year-old digital shelter title, which was co-founded by Adams and photographer Patrick Cline and last July was acquired by Livingly Media, which also owns Zimbio and Stylebistro.
Livingly CEO Tony Mamone said that since the takeover, the digital replica magazine has introduced a subscription-based iPad version, but has continued to draw most of its ad revenue from upscale advertisers.
Readership has been booming. He said there were 250,000 users at the time of the purchase and it now boasts over 1 million visitors per month.
Mamone said the site is still operating in the red but he is more interested in audience reach at the moment.
“Our main focus is how quickly can we scale the audience.” He said it recently cracked the comScore top 20 in the shelter category.
Six-year-old Livingly Media has raised a total of $14 million from venture partners including Menlo Ventures, Draper Richards and Great Oaks Capital.