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Follow-up to “Another One Bites the Dust”

This is a quick follow-up to a prior post, “Another One Bites the Dust: Readers Digest In Bankruptcy.”  It now appears that Fortune Magazine has come under severe financial distress.

Consider this recent headline: “Fortune Magazine To Sharply Cut Publishing Frequency.”

First Portfolio, the business magazine launched just two years ago by publishing giant Conde Nast, folded. Then, the largest business magazine in America, BusinessWeek, was sold by its parent company, McGraw-Hill (MHP), to Bloomberg for as little as $3 million plus its subscription liabilities. Now, Fortune, started by Time, Inc. founder Henry Luce, will cut its publishing frequency from 25 times a year to 18 times. According to several media reports, Time, Inc. will also cut several hundred jobs. Time, Inc. is part of media giant Time Warner (TWX).

Fortune will probably never recover.  The magazine is victim to a changing economy in which its primary moneymaker — print advertising — is simply not as lucrative as it used to be.  Plus, the internet has provided a barrage of new competition, much of it available for free or at a very low cost.  And, perhaps more importantly, you can’t e-mail, re-post, or Twitter a hard-copy article like you can an online article.  If Fortune plays its cards right, it could perhaps retain its prestige as a premier financial website.  But it it doesn’t make some substantial changes, it will be on the fast road to irrelevance.

Charles Sizemore, CFA
Co-author of the recently-published Boom or Bust: Understanding and Profiting from a Changing Consumer Economy