Time Inc. Plans About 600 Layoffs
Time Inc., the world’s largest magazine publisher, plans to cut 6 percent of its work force — more than 600 positions — and will revamp the organization in a way that could radically alter the culture at the company.
The company outlined the overhaul on Tuesday evening in a memorandum to employees after The New York Times revealed the cuts on its Web site. The layoffs will begin in about two weeks.
No magazines are scheduled to close, but some are likely to be severely cut back. Ann S. Moore, Time Inc.’s chairman and chief executive, was already planning an overhaul because of the upheavals in print media, but she was forced to speed up those efforts amid the financial crisis and looming recession.
Time Inc.’s 24 magazines in the United States and their Web sites will be organized into three divisions: news, which will include Fortune, Money, Time and Sports Illustrated; lifestyle titles, which include Real Simple, Cottage Living, Coastal Living and Southern Living, among others; and style and entertainment, which includes People, InStyle and Entertainment Weekly, which has suffered a severe downturn and is likely to be whittled down under the new structure.
Heads of the news and entertainment units will continue to report to John Huey, the editor in chief of Time Inc. The lifestyle unit, which may be run by Bill Shapiro, who has been development editor, will report to the business side of the company. Martha Nelson, who is editor of the People Group, will head the entertainment division.
Ms. Moore declined to be interviewed, but in an article published in The Times of London a little more than two weeks ago she said, “I don’t know if there will be layoffs.”
The company, a division of Time Warner, the media conglomerate that includes CNN, Turner Broadcasting, HBO, AOL and the Warner Brothers movie studio, is facing the twin perils of a shifting landscape from a severe downturn and a loss of readers and advertisers to the Web.
Time Warner is scheduled to report quarterly earnings on Nov. 5, and will announce how much savings it expects to wring from Time Inc. It may take a charge to its earnings to account for the revamping.
Within Time Warner, where Jeffrey L. Bewkes is nearing his one-year anniversary as chief executive, Time Inc., while profitable, has been a lag on growth. In a conference call with Wall Street analysts in August, Mr. Bewkes said both AOL and Time Inc. “are tracking behind our expectations this year.”
Executives said the reorganization was intended partly to allow Time Inc. to focus on its big brands — publications like Sports Illustrated, People, Time and Fortune — on platforms other than print. Examples executives cited were Sports Illustrated-branded kiosks that are popping up in airports and a music festival that was put on by Essence.
Power within Time Inc., which through many mergers over the decades became the modern Time Warner, has long been diffuse, with individual publishers and editors essentially running their own shows. That distinct culture is coming to an end.
Dawn Bridges, senior vice president for corporate communications at Time Inc., said that, in the future, “we’ll have a more centralized management structure that will group together titles that share similar audiences, advertisers and the talents and skills of their staffs.”
The changes will lead to more sharing of writers between magazines within each new division, examples which have already been seen, including a cover story in Time in late September that was written by Andy Serwer, Fortune’s managing editor, and Allan Sloan, a columnist at Fortune.
Even after previous cuts, the company still has 10,200 employees globally, with about 7,000 in the United States. (In addition to its well-known American publications, Time Inc. owns nearly 100 magazines abroad.)
None of this has been enough to fight off the changes roiling the media industry. When Time Warner last reported earnings — on Aug. 6, for the second quarter that ended June 30 — it reported a 6 percent, or $77 million, decline in revenue at Time Inc. to $1.2 billion. Operating income was $218 million, down 15 percent.
In a separate announcement Tuesday, Time Inc. sent a memorandum to employees saying that Edward R. McCarrick, a 35-year veteran, would retire at the end of the year as worldwide publisher for Time magazine.
David Carr contributed reporting.
The company outlined the overhaul on Tuesday evening in a memorandum to employees after The New York Times revealed the cuts on its Web site. The layoffs will begin in about two weeks.
No magazines are scheduled to close, but some are likely to be severely cut back. Ann S. Moore, Time Inc.’s chairman and chief executive, was already planning an overhaul because of the upheavals in print media, but she was forced to speed up those efforts amid the financial crisis and looming recession.
Time Inc.’s 24 magazines in the United States and their Web sites will be organized into three divisions: news, which will include Fortune, Money, Time and Sports Illustrated; lifestyle titles, which include Real Simple, Cottage Living, Coastal Living and Southern Living, among others; and style and entertainment, which includes People, InStyle and Entertainment Weekly, which has suffered a severe downturn and is likely to be whittled down under the new structure.
Heads of the news and entertainment units will continue to report to John Huey, the editor in chief of Time Inc. The lifestyle unit, which may be run by Bill Shapiro, who has been development editor, will report to the business side of the company. Martha Nelson, who is editor of the People Group, will head the entertainment division.
Ms. Moore declined to be interviewed, but in an article published in The Times of London a little more than two weeks ago she said, “I don’t know if there will be layoffs.”
The company, a division of Time Warner, the media conglomerate that includes CNN, Turner Broadcasting, HBO, AOL and the Warner Brothers movie studio, is facing the twin perils of a shifting landscape from a severe downturn and a loss of readers and advertisers to the Web.
Time Warner is scheduled to report quarterly earnings on Nov. 5, and will announce how much savings it expects to wring from Time Inc. It may take a charge to its earnings to account for the revamping.
Within Time Warner, where Jeffrey L. Bewkes is nearing his one-year anniversary as chief executive, Time Inc., while profitable, has been a lag on growth. In a conference call with Wall Street analysts in August, Mr. Bewkes said both AOL and Time Inc. “are tracking behind our expectations this year.”
Executives said the reorganization was intended partly to allow Time Inc. to focus on its big brands — publications like Sports Illustrated, People, Time and Fortune — on platforms other than print. Examples executives cited were Sports Illustrated-branded kiosks that are popping up in airports and a music festival that was put on by Essence.
Power within Time Inc., which through many mergers over the decades became the modern Time Warner, has long been diffuse, with individual publishers and editors essentially running their own shows. That distinct culture is coming to an end.
Dawn Bridges, senior vice president for corporate communications at Time Inc., said that, in the future, “we’ll have a more centralized management structure that will group together titles that share similar audiences, advertisers and the talents and skills of their staffs.”
The changes will lead to more sharing of writers between magazines within each new division, examples which have already been seen, including a cover story in Time in late September that was written by Andy Serwer, Fortune’s managing editor, and Allan Sloan, a columnist at Fortune.
Even after previous cuts, the company still has 10,200 employees globally, with about 7,000 in the United States. (In addition to its well-known American publications, Time Inc. owns nearly 100 magazines abroad.)
None of this has been enough to fight off the changes roiling the media industry. When Time Warner last reported earnings — on Aug. 6, for the second quarter that ended June 30 — it reported a 6 percent, or $77 million, decline in revenue at Time Inc. to $1.2 billion. Operating income was $218 million, down 15 percent.
In a separate announcement Tuesday, Time Inc. sent a memorandum to employees saying that Edward R. McCarrick, a 35-year veteran, would retire at the end of the year as worldwide publisher for Time magazine.
David Carr contributed reporting.
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