The Washington Post Company announced Wednesday that it was putting NEWSWEEK, which it has owned since 1961, up for sale. NEWSWEEK’s Daniel Gross spoke with chairman Donald E. Graham about the decision. Excerpts:
Gross: What did you announce today?
Graham: We announced that The Washington Post Company is prepared to sell NEWSWEEK and will listen to offers to buy the magazine.
Is there a deadline?
No. We expect to listen to what people call expressions of interest for about a month, and then send a complete package of information. And then because it’s good for the business we’ll try to find a good buyer in the shortest possible period of time. We don’t know how long that will take.
Why now? It seems like in the past year there’s been a general bounce back in the economy at large, in the media, and in advertising.
Good question. Three years ago we came to the board of directors with a three-year plan that involved a redesign of NEWSWEEK, a cutting of the rate base from 2.6 million circulation to 1.5 million, and to charge readers more for the magazine, which would in turn change the demographics and make us a better advertising buy. We looked at things at the beginning of this year. The circulation part of the strategy worked very well. We have the number of readers we want paying the circulation we wanted. Now, from an advertising point of view, 2009 was disastrous. It threw us behind so badly that looking ahead we don’t see a path for NEWSWEEK to sustained profitability as part of our company. There were times in the past where NEWSWEEK lost money for a year, but you always felt there was a path.
Has advertising been recovering at all?
Obviously 2010 has been better than 2009. But for all of that, we are like most media. We’re ahead of 2009 but nowhere where we were before.
Is The Washington Post in a materially different position than NEWSWEEK?
Yes. The weekly newsmagazine has been a good business for many years, and NEWSWEEK has a brilliant sales staff. But a daily newspaper in a big city has always had a big advantage. The Post, and every newspaper, gets an enormous amount of advertising from stores and car dealers and help wanted and real estate. I think a newspaper just has more sources of advertising revenue.
Is this a verdict on the genre of newsweeklies?
I don’t know. We know from years of market research that they are very popular with their readers. It’s a complicated world out there, and a newsweekly helps them make sense of it. Where we have not succeeded is in this transition to digital. The overwhelming share of NEWSWEEK’s revenue comes from the magazine, while the editorial staff is probably putting half its time into digital products. I’m disappointed in myself that, starting 15 years ago, I didn’t figure out a way for NEWSWEEK to adapt faster to the environment.
Do you have a preferred buyer?
No. We’re open to anybody who is interested. The start of our company in the 1930s was Eugene Meyer having ideas about something he would create. And I don’t think anybody had heard of him at the time. We’re open to the possibility that the buyer might be someone I haven’t heard of.