Conde Nast's Portfolio's Deep Pockets

This Monday Condé Nast -- publisher of magazines like The New Yorker, Vogue and Vanity Fair -- will launch its long-awaited, much-hyped business title, Condé Nast Portfolio.

Unlike most business magazines, such as Forbes and Fortune, which rely on snappy, analytical stories covering topical news, Portfolio will run long-form features. Furthermore, whereas Forbes and Fortune publish biweekly, Portfolio will appear monthly.

Also set to debut Monday is the magazine's Web site, cnportfolio.com, which "focuses more on the business news of the day," says David Carey, group publisher and president of the Condé Nast Business Media Group. According to Carey, the site will feature a dozen bloggers and a directory of no less than a million executives and companies.

Still, all eyes -- and industry chatter -- remain fixed on the print vehicle, which many believe is Condé Nast's most expensive magazine launch ever. Reports published in The New York Times and elsewhere estimate that the company has committed to spending between $100 million and $125 million on the magazine before it becomes profitable.

Which raises the question: Why now?

Dark Times for the Magazine Industry

Over past two years, numerous glossy magazines have folded and even print's staunchest defenders admit that advertising dollars are trending toward the Internet.

"I can count about 16 titles of notable size that have shut down during the last 18 months," says Bill Mickey, a senior editor at Folio, a trade publication that covers the magazine industry. "In March this year alone, Life, Child, InfoWorld and Premiere were closed, although in all of those cases the publishers have chosen to keep online live, something which is becoming a trend now as print revenue becomes subordinate to online."

High-profile closings from last year include FHM, ElleGirl, TeenPeople and Budget Living.

Amid this print-publishing slump, the business titles suffered the biggest collective ad revenue losses of any single magazine category in 2006, according to an analysis in Folio of the 2006 PIB Revenue & Pages. Those most affected include such Portfolio competitors as Fast Company, Forbes and BusinessWeek.

Still, Columbia Journalism Review's Dean Starkman, who opines on the media in his blog called the Audit, believes Portfolio will be a hit.

"There's been a self-defeating feeling from the media, but this is a big moment for business media," he says. "I think they're going to reinvent the craft of business reporting and make a ton of money."

Dylan Stableford, managing editor of media news at Mediabistro.com, a site dedicated to online and offline publishing, is not convinced. "It's an interesting move to launch a new magazine when magazines are folding left and right. Time Inc. has sold off two magazine divisions, and publishers are trying to figure out how to translate their publications for the Web," he says. "There's a certain bravado there, for sure."

"There's no question that every facet of the media business is in transition right now," says Condé Nast's Carey. "The market is changing. We know people get the business news recaps of the last two weeks on their Treos or BlackBerries -- and they'll get that on our Web site -- but that's not what we're trying to do with this magazine. We've found that there's a big interest in sweeping narratives that elevate the news instead of chase it."

According to Carey, response from advertisers has been "very strong" -- the launch issue has 150 advertising pages. "They get it entirely," he says of his clients. "They are in love with the idea of a longer-shelf-life business publication."

Lucia Moses, senior editor at MediaWeek, says that the advertising community is "hungry for a fresh, new approach in a category that has become tired and fusty."

Still, some of the success Carey boasts of is, she believes, also a result of advertisers wanting to be in the buzzed launch issue. The ultimate question, says Moses, is "Will people want to read in-depth business and lifestyle stories in their free time?"

Anatomy of A Lucrative Launch

In the 20 months since Condé Nast Chairman Si Newhouse and Editorial Director Thomas J. Wallace announced their plans for the new title, the company has been on a poaching spree, collecting A-list journalists for the magazine the way oenophiles collect bottles of Chateau Lafite, beginning with Editor in Chief Joanne Lipman, the former deputy managing editor of The Wall Street Journal and editor in chief of Weekend Journal. A reported 75 people have followed from such places as The New York Times, Time, Vanity Fair and Wired.

While the staff has sequestered itself in Condé Nast's New York headquarters during this incubation phase, gossip about spending, staff infighting and the title's chances for success in a digital world have proliferated on the Web and in publishing circles.

One question that has confused media commentators like Mediabistro's Stableford is the delay between the May launch issue, which begins its rollout Monday, and those that will follow when the magazine goes monthly in September.

"If you're spending so much and you've taken so long on it, you'd think you'd be concurrently putting together the second and third issues to sustain the buzz," he says. "You want to come out firing on all cylinders."

Carey assures that this is a deliberate strategy.

"If you launch a monthly out of the gates, your second issue will already be printed. … This way, we'll learn from the newsstand sales, and we can change our distribution accordingly," he explains. "But ultimately, this is a creative entity and the gap lets it breathe. It gives us a chance to work out which sections work and which may not be working so well."

Carey also refutes the speculation that Portfolio's multimillion dollar launch in the time of digital is the last of its kind.

"That is not possible," he says. "I'm not saying that the business doesn't have certain challenges, but this is not the last launch. That's like saying there won't be another cable network. Go tell that to Rupert Murdoch.

"We look at the industry and see that the glass is half full. We like magazines. We'll launch more magazines."

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