Magazine Ownership

The top of the magazine ownership pyramid remained unchanged in 2004. Time Warner, Advance and Hearst, held onto the top three slots. They own most of the biggest mainstream titles, with Time Warner remaining the largest of the big publishers by far.1

After those three, however, there was movement. Meredith Corporation climbed from No. 6 in revenues to No. 4 and could climb higher in the 2005 rankings after buying some of the better-known women’s titles on the magazine rack, including “Parents,” “Child,” “Fitness” and “Family Circle” from Gruner + Jahr as well as “Ser Padres.”2

Gruner + Jahr, the newspaper and magazine publishing arm of the German media company Bertelsmann, looks to be moving out of the American magazine business. The former seventh-largest magazine owner is no longer in the top 25. And in 2005 (not reflected in the figures above) Gruner + Jahr went further. The company sold Fast Company and Inc. for $35 million. It had bought the two titles for $550 million five years before, at the height of the tech boom on Wall Street.3 The loss was just another sign of the declining economic fortunes of business titles, some of which simply folded when the market nosedived in 2001.

Among the rest of the top magazine companies, Primedia, once the fourth-largest, was bumped down to fifth. Reader’s Digest, formerly fifth, fell to sixth, and so on.4

Magazine Revenue of Top Ten Companies, 2004

Design Your Own Chart

Source: Advertising Age, Chart: Top 25 Magazine Companies

For those biggest publishers 2004 was a good year. Revenues at Time Warner and Hearst rose 8%, those at Advance Publications 10%. The rest of the top 10 companies had more mixed 2004 revenues — four were up and three were slightly down.5

Along with Gruner + Jahr’s exodus, news reports in 2005 about Primedia showed a hard year (though that is not reflected in the chart above, which is based on 2004 figures). Its stock price plunged in 2005 when the company announced plans to spin off some of its assets.6 Do the decisions of Gruner + Jahr and Primedia suggest something about the future of the industry? That it may be becoming an industry only for the biggest of the big companies, or only for the biggest and much smaller companies? One test may come in the next few years if the gap between the largest three or four companies and the rest of the list grows.

For the first two years of this report we noted that the magazine industry had stood out from other media in that the biggest of the big media companies had mostly ignored the sector. As of 2004, that was still true. Of the top 10 media companies over all, only Time Warner had invested seriously in the business, and that investment can be linked to its history. Time Inc. was started in 1923 as a magazine company, and much later expanded into cable with HBO. Even so, magazines have a much smaller role at Time Warner today than they once did, accounting for only 12% of the company’s media revenue. And other media heavyweights such as Viacom and News Corp. don’t even come close to making the top 25 magazine companies by revenue.7

Of course, that also means Time Inc. is one of the hardest hit of the magazine companies when times are bad, as became clear with the company’s layoff of more than 100 employees in December of 2005.8 More layoffs are expected as the industry struggles.