Rieder: Not all's bleak for magazines despite Time plan

• Its magazines are still profitable despite Time Warner%27s spinoff plans
• Niche publications aimed at tightly targeted audiences are faring better
• General-interest magazines continue to struggle

It was just a matter of time.

When Time Warner was created in 1990 by dealmaker extraordinaire Steve Ross, combining Time Inc. and its powerhouse magazine lineup with entertainment colossus Warner Communications, the excitement was palpable.

The Los Angeles Times described the new hybrid as "an awesome giant."

But so much has changed in the media world in the ensuing years, with the onset of the digital age. Magazine advertising and circulation have shrunk. Rather than a jewel in the crown, Time Inc.'s magazines—Time, Sports Illustrated, People, Fortune and on and on — were seen as a drag on the bottom line.

And so Time Warner last week said it will spin off the titles to fend for themselves as a separate, stand-alone unit, the better to concentrate on its lucrative film and television operations.

So, goodbye to Henry Luce's baby, Time, the pioneering newsweekly once such a potent political force. It's a word awarded far too easily these days, but "iconic" certainly applies to Time's status in the magazine world. The announcement of the spinoff, set for later this year, came just weeks after Time published a truly distinguished piece of journalism, Steven Brill's 24,000-word dissection of the U.S. health care system.

Goodbye to Sports Illustrated and its literary flair, not to mention its bathing suits. Goodbye to People, which helped usher in the era of gossipmania. Goodbye to Money and InStyle and Entertainment Weekly and Southern Living.

It's not like the magazines are complete losers. In fact, they're making money. But they're less profitable than they were. And the prospects for major growth in the magazine business are not bright.

So Time Warner kicked Time to the curb.

Coming so soon after Newsweek, Time's longtime archrival, closed down its print version and became digital only, the spinoff of those celebrated titles might suggest that it's all over for magazines. But things aren't entirely bleak.

Sure, the golden era of soaring profits that came to an abrupt halt when the recession kicked in in 2008 isn't coming back. And while the advent of the tablet would seem to offer promise for magazines, progress has been slow.

But, like Time Inc.'s magazines, many still make money. And while things are tougher for general interest magazines, niche magazines aimed at tightly targeted audiences are faring much better.

And there's no shortage of people who want to play. Nearly 200 titles launched last year, according to MediaFinder.com.

Nobody loves magazines more than Samir Husni, the founder and director of the Magazine Innovation Center at the University of Mississippi. And he's certainly not ready to give up on the objects of his affection.

How much does Husni love magazines? Not only is his nickname "Mr. Magazine," he had it trademarked. His magazine collection includes more than 28,000 first editions. When we talked on the phone on Monday, he had just returned from Walmart, where he had dropped $150 on 10 magazines.

Husni is certainly saddened by the latest development affecting the Time Inc. magazines. He sees it as a consequence of having business people with no regard for magazines running a company that was launched by a visionary journalist. And he sees that as emblematic of broader changes in the industry.

As for the spinoff, Husni's big fear is that it will lead to a breakup of the magazine unit, that it will "open it up to vultures from all over the place who will pick off the magazines piece by piece. They are going to be more vulnerable now. It's a shame when a media giant is treated like a soccer ball."

Husni readily agrees that the glory days of, say, 2007, "when magazines were printing money," are gone forever. "They had the carpet pulled out from under their feet," he says. "They're still trying to come back."

But he thinks some perspective is in order.

"Magazines are still bringing in a lot of money," he says. "Many magazines are profitable. Are they making less? Yes. Maybe we need to be less greedy."

And he is dazzled by the huge increase in the number of magazine titles. In 1980 there were about 2,000. Now there are 10,000. The proliferation reflects the dominance of the niche. Today there's a magazine for virtually every interest, no matter how arcane. "There are about eight magazines about chickens," Husni marvels.

Mary Berner, president and CEO of the magazine industry trade association MPA, knows her business has a perception problem. "The narrative is that magazines are dead, and nothing could be further from the truth," she says. She also says that magazines have an advertising problem, one she believes is "fixable."

As for the future, Berner says she's "cautiously optimistic" because of three major assets: "enduring brands, high levels of consumer engagement and content you can't find anywhere else." She adds, "We've got the core DNA to succeed."

And she thinks magazines will increasingly flourish on tablets as it becomes easier to find them on the mobile devices.

As for the ones doing the spinning, this is nothing new for Time Warner. Over the years it has jettisoned AOL (ending a truly horrendous merger), Time Warner Cable and Warner Music.

All that spinning reflects a major shift in the media business. No longer does bigger seem better. Companies are focusing on what's most profitable and what they do best. Rupert Murdoch's News Corp. is creating a separate company for its newspapers, which are far less lucrative than its film and TV holdings. The New York Times Co. has shed (or is trying to shed) virtually all of its other holdings to concentrate on the core product.

The remaining suspense is over what Time Warner will call itself once the magazines are gone later this year. It seems silly to keep the "Time" in a Time-free company.

And Spin Warner kind of has a ring.

Rieder is editor and senior vice president ofAmerican Journalism Review.