Even Forbes Is Pinching Pennies

NYT staffer David Carr writes an interesting piece that looks at Forbes and how tightfisted the place has become. Years ago, it had a reputation for great journalism, good pay and benefits. That's a far cry from today. Forbes is feeling the strains of the downturn in advertising. The main focus has shifted from the magazine to Forbes.com on the belief that it will some day replace the magazine as the leading source of ad revenue.

If Forbes.com doesn't fly, the family may not get much more out of the enterprise beyond the $300 million-$400 million it is estimated to have received for a 40% stake from Elevation Partners several years ago. The company is shrinking - not growing. It is probably safe to say that Forbes isn't worth what Elevation paid even several years ago. And the vote is still out on Forbes.com and whether it will ever be as successful as the magazine once was. - MT

The New York Times - The recession is testing Forbes magazine and the family behind it, long symbols of the fruits of capitalism.

Although circulation has been basically stable at about 920,000, the average price per issue on subscriptions has been dropping steadily, which means Forbes — like a lot of magazines — is fighting to hang on to its subscribers.

Ad pages are down 15 percent in the first quarter, compared with the period a year earlier. Forbes.com, one of the top five financial sites by traffic, throws off an estimated $70 million to $80 million a year in revenue, but never yielded the hoped-for public offering.

The company, historically benevolent to employees, has ceased matching contributions to its 401(k) program. Out of its 1,000 employees, it has laid off about 100 since November, including 20 people in January, and has announced an unpaid five-day furlough for employees.

In 2006, 40 percent of the enterprise was sold to Elevation Partners, a private equity firm, for a reported $300 million, setting the value of the enterprise at $750 million. According to Mark M. Edmiston of AdMedia Partners, “it’s probably not worth half of that now.”

Forbes’s misery certainly has plenty of company among its competitors. Ad pages have declined even more at Fortune and BusinessWeek. Revenue figures from the Publishers Information Bureau, a generally inflated index, listed revenue of over $338 million for Forbes, $276 million for Fortune and $236 million for BusinessWeek. http://www.nytimes.com/2009/06/15/business/media/15forbes.html