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By Richard Pérez-Peña
Friday, October 31, 2008
Condé Nast Publications will make deep staff cuts at two magazines, Portfolio and Men's Vogue, and publish them less often while cutting budgets across the company by 5 percent, company executives said Thursday.
Men's Vogue will all but disappear as a separate operation. It will be folded into Vogue and will be published twice a year instead of 10 times, the company said. Employees said they were told Thursday that most of the magazine's staff would be laid off.
The business magazine Portfolio will be published 10 times a year instead of 12. Employees said they were told Thursday that most of Portfolio's Web site staff would be dismissed and that much of the content unique to the site would be dropped.
The company's official position was that it had not yet determined where it would cut Portfolio, or how deeply, but executives who spoke on the condition of anonymity because they were not authorized to go into detail said they expected that 15 to 20 percent of the magazine's jobs would be eliminated. Some of the cuts will involve Portfolio's online operations, including advertising sales, which will be folded into those of Wired magazine.
The cuts at Condé Nast demonstrate that the belt-tightening at American magazines has reached even those that rely on luxury product advertising — a segment of the industry that has held up better than most.
"We still like the magazines," said David Carey, a group president at Condé Nast who directs several magazines, including Portfolio. "What we don't like is the revenue trend across all sectors of the business."
Through the first nine months of the year, ad pages in all U.S. magazines were down 9.5 percent from the same period in 2007. Most magazines produced by Condé Nast — including Vogue, GQ, Architectural Digest and Wired — have had much smaller declines, but they are also among the most expensive magazines to produce.
Portfolio, started last year amid much fanfare, is Condé Nast's first business magazine and its most expensive new project in years. Executives said the company was willing to lose more than $100 million on it.
It had an average circulation of 415,000 in the first half of the year and 445 ad pages through nine months — good figures for a new magazine but still far short of profitability. It hired a staff of prominent editors and reporters at high salaries but has been roiled by internal disputes and high turnover. Men's Vogue, started in 2006, has circulation of almost 370,000 and 449 ad pages through nine months.
Condé Nast executives said spending had been under budget, with several positions unfilled, which would limit the effect of the 5 percent budget cut.
Aside from Men's Vogue and Portfolio, they said, staff cuts would mostly be achieved by attrition, though they said there would be some layoffs.
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