IAC Seeking Buyers for Newsweek (EXCLUSIVE)

Newsweek for Sale: IAC Seeks Buyers

Newsweek appears to be on the block — again.

According to sources who have been briefed, IAC is sending out inquiries to prospective buyers who may be interested in purchasing the 80-year-old title, which ended weekly publication of its domestic edition late last year in favor of an digital-only format. A revamped Newsweek.com launched earlier this month.

SEE ALSO: Barry Diller Calls Newsweek Purchase a “Mistake”

A spokeswoman for IAC had no comment.

As with the first sale of Newsweek, the price is expected to be negligible; what will matter more is the assumption of liabilities, although Newsweek is a much pared-down operation.

IAC obtained its stake in Newsweek after it merged the Daily Beast with the venerable publication in 2010, under an agreement with investor Sidney Harman, who had recently bought the magazine from the Washington Post.

But all signs are that the publication — which the Washington Post Co. sold for $1 and assumption of liabilities — has been a stepchild to the Daily Beast.

IAC’s Barry Diller last month signaled his unhappiness with the purchase, telling Bloomberg TV that “it was a mistake” to buy the publication and a “fool’s errand if that magazine is a news weekly.” While praising the journalists who work there, he said that he did “not have great expectations” for the digital product.

Newsweek renamed its digital tablet edition Newsweek Global, although print editions still exist overseas under royalty arrangements. IAC is pitching the opportunity to “innovate” a business model, with an emphasis on narrative journalism and plans for one-advertiser-per-article sponsorships. A “soft” launch of a redesign of its Newsweek website earlier this month includes the same content as the tablet edition, and the company has announced plans to move to “metered” Internet access with subscriptions at $2.99 per month.

In the most recent quarter ended on March 31, IAC reported an operating loss of $8.8 million in its media group, which includes News_Beast, the combined Newsweek and Daily Beast operations, from an operating loss of $6.7 million in the same quarter a year earlier. The company does not break out separate earnings for News_Beast. But it said that in the first quarter for News_Beast and About.com, revenue rose 8% and operating income before amortization rose 29%. It said that the full year outlook was for a percentage growth of operating income before amortization in the mid- to high 20s for About and News_Beast.

According to sources who have been briefed, Newsweek’s 1.5 million subscribers, in the quarter before it ended its print edition, fell to 470,000 in the first quarter of this year, with estimates that it will continue to decline throughout the year.

The figures showed positive operating income before amortization, but negative cash flow.

Online traffic declined from 2.9 million unique visitors in January, to 1.9 million last month, according to those who have seen the numbers.

What remains to be seen is what the sale will mean for Tina Brown, who has led the charge to revive the struggling brand since coming aboard as editor of Daily Beast for IAC in 2008.

Barry Diller/IAC Acquisitions in Photos:

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  1. Lite O'Daye says:

    Looks like Tina Brown has failed again. Barry Diller should have brought in someone without a political agenda that puts off over 50% of the American public to run the organization. Newsweek is an example of media suicide that Time Magazine, LA Times, NY Times, & WashPost are currently committing. If you alienate a substantial segment of potential readership, you’re on the path to failure. Newsweek was just ahead of the curve. The others are jumping off the cliff right now. Can’t say that I have much sympathy for any of these folks.

  2. Shi says:

    $1 anyone?

  3. RedRiver8 says:

    Newsweek losts its relevance years ago. It took a hard left turn and lost half of its readership. It has never recovered and then Tina Brown drove it right into the ground with her silly politics. Nobody cares what this web site offers anymore, it’s a loser that will never recover. Close it.

  4. Elsewhere says:

    Wonder how it would do if they took a balanced approach to the news. After all patients need something to read while waiting to see doctors.

  5. Dave72 says:

    Ya-a-aawnnn.

  6. John Rogers says:

    Who would subscribe to a print news magazine that comes out once a week? Hey! Lindbergh landed in Paris!

  7. Testicules says:

    Guess the market for dnc agit-prop is saturated…

  8. Herbster says:

    I bid fifty cents. You know where to contact me to sign the contract. By the way, that’s fifty cents in CASH. NO checks!

  9. roger kaufman says:

    As a subscriber starting in the 60’s I finally lost commitment to their editorial bias. Nail Furgesen was a breath of fresh air but it went from being NEWSWEEK TO NEWSWEAK. i quit subscribing a couple of years ago in favor of the more balance THE WEEK. Sic transit.

  10. dennis brown says:

    Why would anyone actually pay to read a far left radical rag?

  11. sw says:

    it makes great toilet paper

  12. Donnie frank says:

    Newsweek evolved into the best dental floss because it was so thin!

  13. kim says:

    Newsweek was unabashed, unfiltered, pure liberalism. It failed because it wasn’t inclusive, it chose to be intolerant. How does it have any value to be sold? It needs new personnel from top to bottom.

  14. Ookin Panub says:

    I will offer $1…no 50 cents….no make that 10 cents. One penny! Oh never mind.

  15. bobthemoron says:

    I’ll take it if they pay operating costs for six months.

  16. Feech LaManna says:

    The only thing this leftist rag is good for is lining the bottom of a bird cage.

  17. feral2th says:

    Propagandists belong in the toilet..

  18. Mensa Graham says:

    @gdturner – Have you bothered to read RT.com? You might see that they are laughing at our current administration for doing to us what they already barely survived. That communism thingie you laught about. Read before you stick your foot in your mouth!

  19. Mensa Graham says:

    An investor woudl be better off starting their own magazine than beign saddled with this progressive rag.

  20. gdturner says:

    Now that Larry King has officially gone COMMIE, Pravda Newsweak would be a natural fit.

  21. weneedrubio says:

    It seems like all I ever hear Dillar say is “buying that was a mistake,” he is a good example of how the rich are insulated from any downfall. I don’t think I’ve evr read anything about a successful endeavor on his part.

  22. maryh3 says:

    Might help sales if they got rid of the leftist bias, quit spinning the news and quit using it for leftist indoctrination.

  23. DJH says:

    “Narrative journalism”? Wouldn’t a better description be “activist journalism” which is precisely why it died to begin with. 98% of the media is trumpeting a liberal vision, ignoring the majority of Americans – in fact, attacking a majority for not being smart enough to blindly adhere to liberal ideology.
    newsweek, time, nyt, wapo and the alphabet nets have destroyed their own credibility – good riddance!

  24. Shaniqua Williams says:

    Newsweek is a propaganda rag that is no different than any other propaganda rag. Why would anyone in their right mind buy it, unless they proposed to cover ALL of the news, which would actually make it a success.

  25. tim says:

    i’d offer a dollar for newsweek and either stick a fork in it until it stops wiggling or let it completely rot off the vine. and of coarse, a proper burial.

  26. Rob says:

    I stopped reading when I got old enough to see that it was all just liberal talking points. I lost interest in all those low information voter rags.

  27. steve5150 says:

    If I understand this article correctly all any buyer would be getting is News Weeks debt and a web page that no one reads. Only in the world of left wing journalism would their be a market for someone else’s debt.

    • Joe Lucido says:

      Liberals love debt, just look at the debt that they have accumulated for our country, they never miss an opportunity to create more debt. It is their mantra to create debt. As long as it is our money and not theirs.

  28. ldcj says:

    It’s a sad day. Newsweek was such a beacon of timely news and genuine enlightenment to millions of Americans every week. As source of clear and unbiased news, it could be relied upon to deliver the complex issues of the day in a factual and honest way. Adios, to our comrades at Newsweek. (satire off)

    • oldclimber says:

      Sad day ? Where has your head been ? That’s all there has been is a steady stream of circular blather and baaa-ing of the sheep repeating each others “authority”. When the economic wolf comes, they turn to shrieking and bleating, not unlike Madonna’s (a staunch liberal) singing voice. Your whole problem, and the problem of most of those writers is they have mistaken the sheep dog for the wolf, and on the current course that will be become obvious to them.

  29. Stumpy Peeps says:

    The digital product is the same Obama worshipping screed the paper product was. Since it insists on denying the many scandals of this administration and “reports” the absurd Obama excuses as fact why not rename it “Newspeak”?

  30. This article is a blithering, shining, example of idiotic accounting. Let me paraphrase the financial statements it makes: “If you don’t recognize some costs of doing business, WE MADE MONEY!” “Would you like to buy us??? “We have organized an expensive staff that writes stuff no one wants to read!”

    • oldclimber says:

      Simple ? Yes I am guilty, if trying to keep the useless fluff out of my life, and my time, qualifies me as simple. What’s your excuse ?

    • Dutra says:

      I don’t even read it at the dentist’s office. Apparently nobody else does either, as the older copies are in pristine condition.

  31. ernaldo says:

    Its funny when you watch the end of a publication that targeted a readership of demotards that were found out to be non readers in the end. Turning those pages is such an effort…..

  32. JJ says:

    “Bush’s fault”…someone had to post it! If the asking price is over $0.01 then it is a ripoff. In fact, any asking price is a ripoff for a worn-out, tired, leftist rag that only generates red ink every day.

  33. Spence says:

    Change the name to Newsweak and turn it into a two-page pamphlet.

  34. Big Tom says:

    Unfortunately, a once great objective. non – partisan news magazine has become a left wing, socialist, very opinionated, subjective rag. Once, millions read Newsweek, now, so few because of its radical leftist, almost anti-American, anti-family, anti-religious and anti military content.

  35. cda says:

    “with an emphasis on narrative journalism”

    who knew my old granpa was a Narrative Journalist when he was reporting the “news” on how many and the size of the fish he caught down on the river – and here we thought he was just spinning tales

    get a clue, narrative journalism might be exactly why people do not look for news from Newsweek

  36. Pouncekitty says:

    Liberal rags are worthless, always were, always will be.

  37. Evil Editor says:

    With newspapers dying, Newsweek would have been a good alternative, but it became mostly opinion and hardly any news. Most people prefer to form their own opinions.

    • CppThis says:

      …or just consult the Internet. Why pay for cookie-cutter MSM op-ed when there’s a vast sea of blogs and activist sites providing equal or better quality material for free?

  38. gunnyginalaska says:

    one dollar

  39. BluesLover says:

    The market for liberal news is shrinking. Last Fall Gallup had a poll in which 65% of Americans thought the news media was excessively liberal and not trustworthy, if the liberal media continues to give cover to Obama and the criminals (and worse) in his administration, that number will grow.

    Good riddance Newsweek. Or as Toby Keith might put it, “See ya, wouldn’t wanna be ya.”

  40. redsoxfan says:

    Nobody cares…this magazine was toast 20 years ago..,,…too much liberalism…

  41. New Z Knight says:

    Adios’ butt munchers, you to Eleanor.

  42. occultology says:

    Sorry Newsweek, but we already get all the LIES and PROPAGANDA that we need from Time, U.S. News & World Report, Fox News, CNN, MSNBC, ABC, CBS, and NBC. Good riddance to you and here’s hoping you died an agonizing death.

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