The Corner

The Praise of Folly

What is there to say about this news item . . .

What do you do with a group of celebrated magazines that no one seems to want?

Time Warner found its answer on Wednesday. It announced it would spin off its Time Inc. magazine unit into a separate, publicly traded company, a move that will allow the media conglomerate to focus entirely on its cable television and film businesses. . . .

Time Inc., suffering from industrywide declines, has consistently lagged in Time Warner’s quarterly earnings. In the three months that ended Dec. 31, revenue at Time Inc. fell 7 percent to $967 million. In the same period, revenue at the company’s cable television channels, including TNT, TBS and HBO, grew 5 percent to $3.67 billion.

In a statement late Wednesday, Jeffrey L. Bewkes, chairman and chief executive of Time Warner, said a complete spinoff would provide clarity for the company as it concentrated on its high-growth businesses, primarily in cable television.

“After a thorough review of options, we believe that a separation will better position both Time Warner and Time Inc.,” Mr. Bewkes said. “Time Inc. will also benefit from the flexibility and focus of being a stand-alone company,” he added.

. . . except that it was written in the stars the day the late Steve Ross — a suave, affable man who had begun his rise to moguldom as the head of a family funeral-parlor business — sailed into the Time and Life Building on Sixth Avenue in Midtown Manhattan, the Jolly Roger flying from his pirate fleet, and took the marks who then ran Time Inc. for all they were worth. The 1989, $14 billion Time-Warner Communications deal created the world’s largest media company. 

And that led in turn to the even more disastrous Time Warner-AOL merger in 2000, when the genius officials at Time Warner, who commanded an empire of the nation’s most famous magazines, Warner Brothers movie studio, and HBO, gave themselves away to an internet dial-up service whose business model was even then failing.

At each step of the way (I know, because I was working at Time magazine at the time), the new Great Leaps Forward were celebrated by a raft of canned statements from the various execs, praising the visionary nature of the deal even as they pocketed wads of cash and posed for fawning profiles in rival media outlets, confidently assuring themselves that they deserved it. 

Now the wheel has come full turn, and the magazines that started the whole thing, principally Time, are back where they started; having fulfilled their function as bait for larger predators, they’re now expendable as a drain on the bottom line.

No one’s arguing that Time and the others, including People and Sports Illustrated, have any meaningful future as print publications. And despite the one thing that Jerry Levin, the Time Inc. exec behind the AOL merger, got right — that the Internet was the future — their presence in the series of tubes that make up cyberspace is today minimal. Harry Luce’s bright idea — to give Americans served by less-than-stellar local newspapers a handy compendium of the week’s news, well written and well organized — has been supplanted by the do-it-yourself, wireless version you’re enjoying right now.

Still, the fall of Time Inc. reminds us of the truth of the old saw, “from shirtsleeves to shirtsleeves in three generations.” Or, in this case, “from stand-alone to stand-alone in 90 years.” Time Inc. reached its apogee with its third editor-in-chief, the great Henry Grunwald, and then steadily declined as the journalists who had been reared under Luce, who shared his vision of the magazine’s mission and who had run the company died off and were replaced by corporate bean counters and bloodless business-school robots who knew everything about magazine publishing except why.

And in publishing, that’s the only kind of clarity that matters. Maybe it’s a lesson that the new, old, improved, seduced-and-abandoned Time Inc. will remember going forward.

Michael Walsh — Mr. Walsh is the author of the novels Hostile Intent and Early Warning and, writing as frequent NRO contributor David Kahane, Rules for Radical Conservatives.


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