What’s Variety Worth and Who Will Buy It?

My insiders say the trade makes about $45 million a year and is profitable. Who still likes content?

What’s Variety worth?

I’ve written that sentence before. But the answer has decreased considerably in the time since I first wrote it.

Reed Elsevier has finally agreed to sell its crown jewel in business-to-business publishing. As recently as six months ago the publishing giant rebuffed interest from outside buyers.

Now — four years after deciding $1 billion wasn’t enough — they are ready to unload the much depleted trade.

Also read: Variety for Sale as Hollywood Trade Struggles in Digital Era (Updated)

They are probably dreaming of a buyer who will overpay to own an historic brand and go to the Oscars. I doubt that will happen. Variety doesn’t have the cachet it used to. Peter Bart is mostly gone. Army Archerd has passed. And there is no one who has filled their shoes.

It’s been a slow and painful decline for the trade that was once synonymous with Hollywood glamour.

Also read: Variety Bleeds Talent, While Newsroom Morale Suffers

A decade ago Variety was racking up astronomical sales figures for a B-to-B trade, upwards of $90 million a year, with profit margins in the stunning 30 percent range and up.

It couldn’t last.

Next came the downturn, and Reed Elsevier put the entire Reed Business Information, a collection of trade magazines, on the block. They wanted $2 billion, and when offers came in at more like $1 billion in late 2008, they pulled the properties from the market, but then ended up selling them off piecemeal.

In late 2008 Variety’s advertising cratered and it has never really come back. Layoffs have followed staff cuts, and much of the talent that was there left on their own accord.

In the interim, TheWrap launched as a robust news competitor, Deadline grew from a one-person blog to the kind of trade that Variety used to be (including stealing their main scoop-machine, Mike Fleming) while The Hollywood Reporter relaunched as a weekly glossy with a web site to match.

The trade still has 100 people there, but their work is stuck behind a paywall that leaves them out of the daily digital conversation.  

Best estimates are that revenues have fallen to about $45 million.

By all accounts, Variety is still strongly profitable, though nowhere near the 30 percent margins it used to make.

So who will buy it? Someone who cares about content. And in a Twitter-Instagram-Facebook obsessed world, those parties are fewer and fewer. Stay tuned, it’s going to get interesting.