"One should either write ruthlessly what one believes to be the truth, or else shut up." — Arthur Koestler
Newsweek magazine lost $20 million last year, each weekly issue therefore representing an operating loss of $400,000. Two years ago, Sidney Harman bought the magazine (and its $50 million debt) for a token $1, and subsequently merged it with Tina Brown’s Daily Beast, which has spent the past four years losing $10 million annually in its own right. Tina Brown has now deployed the notoriously rugged he-man stud Michael Tomasky to describe Mitt Romney as a wimp.
Yeah. Profit is for wimps, I guess.
Or words to that effect. Tuesday we got the not-surprising news that the merger of Newsweek with Tina Brown’s Daily Beast has failed to stem the multimillion-dollar losses at both operations. Tina Brown has never done anything else but lose vast sums of money — a journalistic career written in red ink, as it were — and I had predicted exactly this result when the “Newsbeast” merger was announced in 2010.
After Tuesday’s announcement that the Harman family was pulling back from its “investment” (Sidney Harman bought Newsweek for $1 in 2010), this required some explanation from Barry Diller, whose IAC conglomerate holds the controlling interest in Tina Brown’s red ink empire. And in a Wednesday conference call, Diller seemed to signal that Newsweek would cease print publication later this year:
Newsweek will eventually transition to an online publication, owner IAC/InterActiveCorp (IACI) said today, marking the beginning of the end for the money-losing magazine’s 79-year run as a print weekly.
IAC Chairman Barry Diller made the announcement during a quarterly conference call, saying the New York-based company aims to curb investments in the business. Newsweek is projected to lose as much as $22 million this year, according to a person with direct knowledge of the matter. Still, Diller stopped short of saying the magazine would undergo a “total” shift online.
“The transition to online from hard print will take place,” Diller said. “We’re examining all of our options.”
A plan for Newsweek will be announced as early as September, Diller said. Newsweek became part of his media holdings in 2011 when it merged with IAC’s Daily Beast Co., an Internet news startup that Diller founded with former Vanity Fair editor Tina Brown. The merger was part of an agreement with the late Sidney Harman, who acquired Newsweek from Washington Post Co. (WPO) for $1 and the assumption of liabilities.
It has been estimated that the Daily Beast was already losing $10 million a year before the merger with Newsweek, a magazine that was carrying $50 million in debt when Harman bought it for a token $1. Jeff Bercovici at Forbes reports:
IAC doesn’t break out the Newsweek/Beast’s fiances, but published reports have consistently pegged its losses at around $30 million last year. . . . While Diller said in December that the losses were moderating, a source with detailed knowledge of the business estimates it is now on course to lose as much as $35 million this year, with Newsweek accounting for more than $20 million of that.
That’s a lot of money to lose on a Web site and a magazine. Nevertheless, when Diller expressed the obvious fact that these staggering losses cannot continue infinitely, it evidently set off a panic among Newsweek staffers, requiring Tina Brown to issue this note to her staff:
Barry Diller would like to make it clear that he did not say on the earnings call as reported that Newsweek is going digital in September.
He made the uncontroversial, industry-wide observation that print is moving in the direction of digital.
Below, in summary, are the points he actually made on the IAC earnings call when he was reporting the tremendous results of the company this quarter.
1. The Newsweek brand is strong, and far stronger than it has been in years.
2. We wouldn’t finance The Daily Beast at anywhere near the level of ‘12.
3. That eventually, over time, digital would replace much of print (hardly a controversial revelation).
4. In September we would be evolving our plan for the year ’13, with many options to choose from.
Best,
Tina
Lots to chew on in that brief note, e.g.: How is a brand “strong,” in a business sense, when it is synonymous with catastrophic financial losses? More important, however, is the revelation that Diller won’t continue funding Tina’s operation “at anywhere near” its current levels.
What that will likely mean — if you read between the lines — is a hiring freeze, at the very minimum, and the possibility of significant layoffs.
In other words, the gravy-train years at the Daily Beast are coming to an end, Diller’s stockholders can’t continue forever footing the bill for these extravagant expenses, and Tina’s employees will be expected to endure some belt-tightening measures in coming months.
Tina Brown herself, however, will continue to be the privileged publishing diva she has always been, with an amazing knack for convincing people to let her throw away their money.
“The investors can expect to lose a crapload of cash in the process. The New Yorker reportedly lost $42 million in three years (1995-97) under Ms. Brown’s editorship. Talk lost an impressive $80 million during its two-year existence. Whatever else you might say about Tina Brown, she’s undeniably brilliant at convincing investors to lose money on her projects.”
— Robert Stacy McCain, Nov. 11, 2010
Some 20 months after it was announced that the worthless magazine Newsweek would merge with Tina Brown’s Daily Beast, we learn that Brown’s deep-pocketed patron Barry Diller has taken over controlling interest from the family of Rep. Jane Harman (D-Hezbollah).
Peter Lauria of Reuters explains the incredible sums of cash Tina’s “Newsbeast” has lost in the past couple of years:
The Harman family confirmed its ownership stake has been diluted by its decision to cap contributions to the loss-making venture, but would not give a figure. . . .
Sidney Harman acquired Newsweek from the Washington Post Co in August 2010 for $1 plus the assumption of the magazine’s more than $50 million in liabilities.
Barry Diller launched The Daily Beast under the auspices of former New Yorker and Vanity Fair editor Tina Brown in October 2008. . . .
[M]edia reports have estimated losses at The Daily Beast at around $10 million annually.
Diller and Harman decided to merge their titles in November 2010 — the rationale was to leverage the combined audiences to cross-sell advertising at both publications and subscriptions for Newsweek. . . .
So far, however, the combined venture is still losing money, according to Diller, though he has said this year’s loss will be substantially less than last year’s. He did not give a figure and Brown has called reports of $30 million in losses last year “excessive.”
OK, if $30 million is an “excessive” estimate of their 2011 losses, but nobody’s arguing with estimates of $10 million of red ink a year, isn’t it a fair guess that Tina has pissed away at least $50 million in the past four years, including about a million a month since the merger?
Y’know, with a million bucks a month, maybe I could put together a kinda trendy Web site or something. Even without Barry Diller-sized cash infusions, we haven’t done too badly.
Hit the freaking tip jar. Like you were a multimillionaire media mogul and Tina Brown was giving you a hand job in the backseat of your limo.
Because we all know that’s how she does it, right?
PREVIOUSLY:
OK, maybe it’s stretching the definition of “mainstream” to include the Daily Beast and MSNBC, but the predicted eruptions of the “Mormon Mitt” meme keep occurring with increasing frequency.
Notice how Newsweek/Daily Beast reporter Ben Jacobs hands a cue to Montana’s Democrat Gov. Brian Schweitzer:
While discussing swing states, Schweitzer said Romney would have a “tall order to position Hispanics to vote for him,” and I replied that was mildly ironic since Mitt’s father was born in Mexico, giving the clan a nominal claim to being Hispanic. Schweitzer replied that it is “kinda ironic given that his family came from a polygamy commune in Mexico, but then he’d have to talk about his family coming from a polygamy commune in Mexico, given the gender discrepancy.” Women, he said, are “not great fans of polygamy, 86 percent were not great fans of polygamy. I am not alleging by any stretch that Romney is a polygamist and approves of [the] polygamy lifestyle, but his father was born into [a] polygamy commune in Mexico.”
Romney’s father, George — who served as governor of Michigan and was a member of the Nixon cabinet and also a presidential candidate — was born in Mexico in 1907 to a family of American Mormons who fled to Mexico when the United States government cracked down on the practice of polygamy. George Romney’s parents were in a monogamous marriage, but Mexico was the last bastion for the practice of plural marriage in the Church of Latter Day Saints.
Jacobs just casually mentions — oh, by the way, how ironic! — Romney’s father being born in Mexico, and this automatically triggers Schweitzer to start in on a rant about a “polygamy commune,” and to then further contextualize this in terms of what percentage of women voters disapprove of polygamy. This rant then provides an excuse for Jacobs to relate the biographical/historical facts.
Completely coincidental, you see. Just a reporter doing his job.
Meanwhile, on MSNBC, Martin Bashir delivered a sermon Thursday:
It’s now time to clear the air and on Wednesday’s broadcast we brought you a spirited discussion about Mitt Romney’s Mormon faith and one pastor’s view that Mormonism is both theologically heretical and a cult.
Today, we wanted to focus on what Mormonism says about lying and the reason is quite simple — Mr. Romney seems to be having some trouble telling the truth . . .
Which brings us to the moral codes of Mormonism that Mr. Romney claims to live by. In section 63 and verse 17 of the Doctrine and Covenants of the Mormon Church we find this: “All liars, and whosoever loveth and maketh a lie, and the whoremonger, and the sorcerer, shall have their part in that lake which burneth with fire and brimstone, which is the second death.”
And from the Book of Mormon, 2 Nephi 2:34, we find this: “Woe unto the liar, for he shall be thrust down to hell.” Given what the Book of Mormon is clearly saying, Mr. Romney has but two choices — he can either keep lying and potentially win the White House but bring eternal damnation upon himself, or he can start telling the truth.
Now, the video:
Visit msnbc.com for breaking news, world news, and news about the economy
As you can see, Bashir calls Romney “Mitt the Mendacious” three times. The crudeness of Bashir’s rhetorical method is enough to make Allahpundit pine for “the relative subtlety and understated good taste of Keith Olbermann.” Bashir also reminds MSNBC viewers that on Wednesday, he interviewed Pastor Robert Jeffress, the Southern Baptist who endorsed Romney despite Jeffress’s continued insistence that Mormonism is a heretical cult.
What Bashir is doing is something I explained two weeks ago: Using evangelicals as a “hook” to bring up Romney’s Mormonism. This is a familiar theme that mainstream reporters have been working on ever since the 2008 campaign. The supposed anti-Mormon prejudices of evangelical Christians that were much talked about in terms of Romney’s difficulties in GOP primaries will now be reinterpreted as an excuse to talk about Mitt’s Mormonism for the general election campaign.
It’s a great two-birds-with-one-stone-stone trick for liberals: “Look how bigoted these holy rollers are and — hey, by the way — did you notice that Romney’s religion is kinda weird and has a history of polygamy, violence and racism? Also, coming up next, we have an exclusive interview with an ex-Mormon woman who has written a book that says the church is horribly sexist . . .”
There will be no end to this, and those who are sanguine about Romney’s election chances — Ace seems positively giddy these days — may be naive in thinking the media’s steady drip, drip, drip about Mormonism will not hurt Mitt with independents.
Three words: “Low-information voters.”
The kind of people who never vote in primaries and seldom vote in mid-terms, but who feel it their patriotic duty to vote in presidential elections, are notoriously disengaged from politics on a day-to-day basis. They don’t pay much attention to the news, and have only a superificial knowledge of issues and ideologies. They usually show up in poll data as “don’t know/don’t care/undecided.”
What will these voters know about Mitt Romney by Nov. 6? They’ll know he’s rich, and they’ll know he’s Mormon.
What the media are doing now is establishing a pretext for future in-depth coverage of the history, beliefs and practices of LDS. When the “low-information voters” start paying attention, what they will learn about Mormonism from the media will be . . .
Well, it won’t be anything that makes independent “swing” voters want to go storming to the polls to vote for Romney, that’s for sure.
Remember George Allen’s 2006 campaign? Liberals spent months laying down the background of Allen’s alleged “neo-Confederate” connections, with articles in the New Republic and other outlets, so that when he said “macaca,” it was like he had hit a trip-wire that exploded a mine and set off a massive ambush.
They’re now doing the same to Romney with the “Mormon Mitt” meme: Establishing the map-grid coordinates, as it were, so that when the signal flare goes up, everybody is aiming at the same target and Romney is helplessly trapped in the media kill-zone. They’ve got Romney zeroed in already: When he attempts to “distance” himself from whatever out-of-the-mainstream Mormon belief he’s accused of holding, his denial will then be used as evidence that he is just an insincere panderer with no core principles. If Mitt complains that he is the victim of religious bigotry, they’ll mock him as a whining crybaby.
All of this is perfectly predictable, you see: It is foreshadowed already, and the fact that they held back until after they were sure Romney had the nomination locked up — once Mitt won Wisconsin — was a clear clue of their ultimate intention. Yesterday, it was announced that Mitt would give the commencement address at Liberty University. Look how the New York Times played it:
Mitt Romney will deliver the commencement address at Liberty University, the evangelical institution founded by the Rev. Jerry Falwell in Lynchburg, Va.
Mr. Romney’s campaign said the university invited him to speak to the approximately 48,000 people expected to attend the graduation ceremony on May 12.
Virginia is a swing state, but for Mr. Romney, this invitation offers a chance to shore up one of his weaknesses within his base, as many evangelicals remain wary of his Mormon faith.
Jerry Falwell Jr., the university’s chancellor, said in a statement that “we are delighted” that Mr. Romney would be speaking, and he compared the visit to those of Ronald Reagan in 1980 and the elder George Bush in 1990. However, the decision has already sparked controversy among students and alumni of Liberty University, with nearly 300 people commenting on the institution’s Facebook announcement within two hours of its posting.
“I am so disappointed in my university for their choice in commencement speaker Romney. You have lost a potential grad student,” wrote Paige Farmer. “It is shameful that you would allow him a stage for political gain. What could a Mormon possibly have to share with Christians?”
You can see it coming a mile away, folks. Don’t say you weren’t warned.
UPDATE (Wombat-socho): INSTALANCHE!
UPDATE II: Linked by Bob Belvedere at the Camp of the Saints, Wolves in Sheep’s Clothing, The Conservatory, Andrew J. Patrick, Daley Gator, Da Tech Guy, John Schroeder, The Crawdad Hole and by His Vorpal Sword, who awards me the “Golden Buttplug.” Uh, thanks, I guess.
RECENTLY:
MSM meltdown yields a hideous amalgam: The newsmagazine that Jon Meacham ran into the toilet will merge with Tina Brown’s HuffPo knockoff:
Newsweek and The Daily Beast will announce tomorrow morning that the two publications will merge, a source close to the deal tells The Observer.
It will be a 50-50 merger of the two companies. The editorial staffs will combine under the editorship of Tina Brown, who will again run a high-profile glossy.
Newsweek owner Sidney Harman, 92, and IAC chairman Barry Diller had for weeks disagreed over an operating structure for the hybrid publication. The deal reached today establishes a daily role for Mr. Harman and strong editorial independence for Ms. Brown.
It might be difficult for Newsweek’s down-the-middle, fair-and-balanced staff to cope with Peter Beinart screeching about wingnut McCarthyism or Kirsten Powers musing on “the GOP’s long, hot, racist summer.”
Looking through the history of Ms. Brown’s career — Tatler, Vanity Fair, New Yorker, Talk — it’s hard to resist the suspicion that Newsbeast (or whatever the resultant hybrid is called) will be mainly about celebrities, both as subjects and as writers.
The investors can expect to lose a crapload of cash in the process. The New Yorker reportedly lost $42 million in three years (1995-97) under Ms. Brown’s editorship. Talk lost an impressive $80 million during its two-year existence. Whatever else you might say about Tina Brown, she’s undeniably brilliant at convincing investors to lose money on her projects.
Alas, there’s only one Tina and probably lots of would-be media moguls out there with millions of dollars to throw away on glitzy media operations. Send me an e-mail and we’ll do lunch.
But if you decide instead to hit Vegas and blow your millions on blackjack and hookers, I’ll understand.