The vision of reinventing the venerable Hollywood trade as a business-to-consumer glossy publication attracting brand advertising was never going to work
This week marks the end of the latest incarnation of The Hollywood Reporter. With 100 of the publication’s staff vaporized in perfunctory online group dismissals without so much as commemorative plaque and a “thank you for your service,” the dream of a 21st-century media reinvention is over.
As former chief film critic Todd McCarthy — a 40-year veteran of the craft — wrote the day after he was axed: “It’s a bloodbath.” It was.
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The vision of reinventing the venerable Hollywood trade as a business-to-consumer glossy publication attracting brand advertising with a strong digital presence didn’t work. It was never going to work.
Although owner Todd Boehly tried valiantly, the economics just never made sense. The glossy weekly publication never reached more than 70,000 or so readers. It was launched at a time when print had already begun its steep decline. And with a well-paid newsroom and a well-padded business staff that numbered as high as 250, even a robust digital audience would never keep up with the costs.
TheWrap has chronicled this dilemma at regular intervals since breaking the news in winter 2009 that a group of investors that included James Finkelstein (owner of “The Hill”) and Guggenheim Partners’ Boehly were buying the Nielsen-owned entertainment publications, led by THR and including (at the time) Billboard, Backstage, Adweek, Brandweek, Mediaweek and Editor & Publisher, for a bargain-basement price of $70 million.
Even back then, nearly all of those publications were losing money and THR was in one of the worst situations of them all. As I wrote then: “The Hollywood Reporter in particular has suffered huge fall-offs in revenue, readership and even online followers. The Reporter has gone through a series of successive cutbacks in staff, leaving a skeletal editorial team running the once-flush operation.”
This was the self-same year that TheWrap was founded. And when a few of the investors approached me to buy TheWrap and bring it into the group, I told them what I also wrote for the record: I didn’t get it.
The group pressed ahead. In April 2010, then-CEO Richard Beckman commented to the Daily Front Row that the Reporter should be like a hybrid between The Economist and Vanity Fair:
Yeah, in terms of a visual package I want it to be as arresting as Vanity Fair while providing the insight of a weekly publication like the Economist. When I read the Economist, no matter how many stories I’ve read about the same thing, I’m smarter, and I think the texture and the back story is something that will appeal to people who follow the entertainment industry.
He hired Janice Min, the former editor of Us Weekly, who proceeded to fulfill that vision and spent generously to get there, throwing out the former staff and hiring top editors and reporters. She spared no expense in working with A-list photographers for glitzy magazine covers that catered to industry bigwigs and celebrities alike.
When Min gave me an early interview in May 2010 after her hire, by her account the trade employed just 15 people. Do you plan to shift coverage to a more consumer-oriented read, I asked? Min: “No. The key audience is still the industry influencers. I would like THR to reach a broader audience of business influencers. When you think who is reading the industry trade you’re thinking of people in executive or creative roles. We live in very different era, where what goes on in Hollywood is impactful to lots of other industries — media, fashion, style.”
And to her credit, she did that. The publication grabbed attention and influence. Over the years, plenty of awestruck articles were written about the beautiful, oversize new publication created by Min. And the outlet began winning awards, including back-to-back National Magazine Awards in 2015 and 2016. But few took the measure of the fact that the print edition cost millions of dollars every year that it never made up in revenue. Billboard, with its international licensing, weekly music charts and annual awards show, made money, even though it was smaller.
Eventually those losses — at one point up to $30 million a year and even now about $20 million or so — became impossible for owners and investors to ignore.
Beckman was tossed overboard early on in 2011 when luxury and brand advertising failed to materialize. But Min continued to build power within Guggenheim, earning promotion to president of THR and Billboard and a salary of over $2 million a year. But she too was ousted in 2017, one of the casualties of her own overspending.
But by that time, Guggenheim had tired of waiting to see its investment pan out. Finkelstein had long since sold his stake, and Boehly remained the lone believer. He assumed full ownership of The Hollywood Reporter-Billboard Media Group in December 2015 when it was spun off from Guggenheim Media, along with Dick Clark Productions and Mediabistro. (We broke that story too.) Less than a year later, we reported that Boehly was trying to find new buyer after still failing to stem the financial losses.
That really was the heart of the problem. THR aspired to be a new version of Vanity Fair, appealing to high-end consumers and advertisers who were dazzled by the glamour of Hollywood. But at its height, Vanity Fair had nearly 1 million paying subscribers, an audience base that THR never remotely approached.
I’ve left out some important twists and turns, notably Boehly’s efforts to sell Dick Clark Productions to a Chinese conglomerate. That was a $1 billion deal that fell through. After that, he combined the whole group with the production company Media Rights Capital (MRC), led by co-CEOs Asif Satchu and Modi Wiczyk, two veteran producers with no experience in news and no appreciation for the complications of owning a production company and a news organization that covers that production company.
They tried, perhaps. But there was no way for Boehly or his CEOs to make the cuts of this week palatable, pandemic or no. They were a long time coming. THR will survive, somehow, but the grand dream is over.
Here is a quick glance back at the 10-year history of THR & Co, via our coverage;
Hollywood Reporter Set to be Sold to ‘Who’s Who’s’ Finkelstein