The Business of Magazines

[mikel]

I could be cheaper because they import directly from the States. At least that's the case with the American Book Store in the Netherlands. They have American mags earlier on the stands than regular shops and it's cheaper.

 

[tarsha]

Newsstands Best (and Worst) Sellers of 2011

No matter what crisis there is on the newsstand, there are a few people who sell no matter what.

Take Sarah Jessica Parker. She pops up on the cover of Elle back in January, Vogue in August and Marie Claire in September and delivers each monthly its second or third best seller of the year. Or, let’s consider Heidi Klum, who can help deliver Lucky its second best seller in March (175,000 sales in a year when they need it!) or bring the August Glamour its second best performer (510,000 sales, in a year when they really need it!). Or Jennifer Aniston, who was Marie Claire’s top seller of the year in that sleepy summer month of July, and, from all indications, delivered Elle one of its best performers of the year in November.

It’s that time of year, everyone. Time to look back and see who sold (and who didn’t) at the newsstand for monthly magazines in 2011. All data is taken is from the Audit Bureau of Circulations, much of it from the Rapid Report, which is subject to minor change since it has not been audited. The majority of publishers have filed results through October or November issues.

So, if SJP, Heidi and Jen are consistently sellers — and have been for some time — isn’t there a newcomer we can add to the list?

Mila Kunis was the new runaway success of 2011. Kunis’ August GQ cover delivered 205,000 sales, by far its biggest hit of the year, through November. She took to W in March and delivered sales 15 percent above average for the fashion monthly. She was the February cover star of Cosmopolitan and brought in 1.7 million sales, which is nearly 10 percent better than the monthly’s average for the first half. And then she graced the cover of Elle in August in a portrait with Justin Timberlake, which brought in 250,000 sales, fourth best of the year for Elle.

And, apparently, Timberlake needed the Kunis boost. Timberlake’s W cover with Amanda Seyfried, for instance, bombed, selling a mere 15,000 copies, the title’s second worst performer of the year. And then Timberlake’s solo cover for Esquire in October brought in a teeny 73,000 sales, its worst performer of the year.

But Timberlake should take comfort in the fact that he isn’t the only heartthrob who can’t sell: Justin Bieber bombed, too. Bieber took Vanity Fair’s cover in February and tanked — it sold 245,800 copies, the third worst seller since Graydon Carter took over the magazine in 1992. Bieber then appeared on the cover of a Rolling Stone issue in March, and sold 5 percent worse than average for the biweekly. But we’ve known this for some time. He appeared on the cover of Teen Vogue and sat down with People last year and sold 10 percent and 25 percent worse, respectively, than average for both titles.
Other bad years: Mrs. Andy Roddick, Brooklyn Decker, posted 81,000 sales for Esquire in February, its second worst performance of the year. Apparently she doesn’t work for women’s books either, as she brought in a mere 182,000 sales for Self, which is 25 percent below the monthly’s average in the first half. Moral of this story, Brooklyn: Stick with Sports Illustrated.

Fergie struggled at the newsstand as well, with the worst seller of the year for Allure in July and the fourth worst cover for Lucky in June. Also, Michelle Williams sold poorly at Marie Claire (third worst performer with 202,000 sales) and for Vogue (second worst performer with 296,000 sales). Likewise, Reese Witherspoon struck out with Vogue (303,000 sales), Marie Claire (242,000 sales) and Glamour (440,000 sales), which represented a below-average performance for each of the monthlies.

It’s impossible to talk newsstand in 2011 without mentioning the person who landed on more covers than anyone: Kim Kardashian. She was Glamour’s bestseller of the year with her February cover and Cosmopolitans’s bestseller as well, when she helped bring in 1.8 million sales in August. But her results elsewhere were mixed. Her Harper’s Bazaar cover in March, her April Self cover and her November Lucky cover were all mild hits — they sold a few percentage points above average. Her December Marie Claire cover isn’t expected to be a barn burner, and a source said that her January 2012 Glamour cover with sisters Khloé and Kourtney is on track to fall below 400,000 sales — a really poor performance. Perhaps the Kardashian Krash is beginning?

In the battle of New York athletes: Mark Sanchez’s September GQ brought in 175,000 sales over Derek Jeter’s April issue, which had 142,000 (J-E-T-S! Jets Jets Jets!).

And then there were the performers who had an up-and-down year: Gwyneth Paltrow was Elle’s best and Self’s second best, but her Bon Appétit cover in June and her January InStyle cover both sold below average for the monthlies. Emma Stone’s July Elle cover was the monthly’s worst performer and her Vanity Fair cover was its third worst, but she scored with Teen Vogue (second best), Glamour and W. Olivia Wilde scored big with Women’s Health (its best), Allure (its second best) and Cosmo (third best), but not Marie Claire (below average) and Glamour (its third worst).

And finally: What about Lady Gaga? Last year, Gaga was the absolute star of the newsstand. This year? She finally showed some ***** in her armor. And why? She wasn’t in costume. Her October Harper’s Bazaar, which featured a Gaga close-up without any makeup, sold only 119,000 copies, its third worst seller of the year. Last year, Jessica Simpson went without makeup for Marie Claire and it was one of its biggest bombs of the year. But when Gaga got all dolled up, she worked: Her March Vogue cover was its second best seller of the year and her May Harper’s Bazaar cover did far better than its autumn counterpart: It sold 159,000 copies, its third best of the year.

So, Graydon, take comfort in your January 2012 cover with Gaga. She’s dressed up just fine.

wwd.com

 

[loladonna]

^It's amazing for such an in-depth article we are left with the question of who were the actual top sellers for most of the magazines?

Elle:

1)Gwyneth
12)Emma Stone

Bazaar
1)?
2)?
3) Gaga


Vogue
1)??
2) Gaga

Lucky
1) ??
2) Heidi Klum


Glamour:

1) Kim K
2) SJP


Marie Claire:

1) Jennifer Anniston

Cosmo:

1) Kim K
2)???
3) Olivia Wilde

Self:

1)???
2) Gwyneth

Allure:
1) ?
2) Olivia Wilde

Teen Vogue
1)??
2) Emma Stone

 

[t-rex]

I wonder if Emma Stone's then-blonde hair on Elle and Vanity Fair was the reason for poor sales.

 

[Melancholybaby]

^^I too want to know who sold better for US Vogue than Gaga. It must be Kate's September issue.

 

[congacon]

^^I too want to know who sold better for US Vogue than Gaga. It must be Kate's September issue.

but whoever on the september issue will be the top seller. that is 99.999999% guarantee. also 85% of whoever on the march cover will be the second best seller.

 

[Miss Dalloway]

^It's amazing for such an in-depth article we are left with the question of who were the actual top sellers for most of the magazines?

My thoughts exactly while reading this, they should have added the best sellers as well.

And i still cant understand how on earth does Aniston always perform so well for mags? Someone like SJP has a huge following because of her fashion icon status,s o of course she sells.

 

[KoV]

My thoughts exactly while reading this, they should have added the best sellers as well.

And i still cant understand how on earth does Aniston always perform so well for mags? Someone like SJP has a huge following because of her fashion icon status,s o of course she sells.

Your average magazine buyer in the states really likes Jennifer Aniston. She's been able to remain incredibly popular and as household name for many years, despite having many more movie flops than hits.

 

[loladonna]

Jennifer Aniston has great hair, a great body (for any age but especially for a 40-something) and a straight-forward, attainable style. I think she represents something aspirational for older women. She signifies that a woman can still maintain a youthful air but still be age-appropriate so people buy her covers to find out how she does it.

 

[tarsha]

In With the New: A Look at 2012

IN WITH THE NEW: The publishing world is all about what’s new and what’s next, so 2012 should be right up its alley. There are lots of changes ahead in Media Land. Here, a brief summary of what lies ahead (but get ready for those surprises that no doubt lurk around the corner).

New Look
• After a tough year at newsstand (sales dropped 17 percent through October), Glamour is planning a major overhaul of the magazine. The new Glamour will debut in March, with new columns and contributors. Insiders say to expect a more trendy and pop-culture-driven magazine. Not one, but two firms have been tapped to assist design director Geraldine Hessler: a design firm run by Michael Angelo, the former art director of Nylon, and Triboro Design, run by the husband and wife duo David Heasty and Stefanie Weigler.

• Glenda Bailey is plotting big changes for Harper’s Bazaar, with a reboot planned for the March issue. In addition to increasing in size (think Town & Country), Robin Derrick of Spring Studios has been hired to assist in a redesign. Early chatter indicates that the magazine will be unrecognizable from what it looks like today. Derrick, former creative director of British Vogue, will work with Bazaar’s creative director Stephen Gan on the revamp.

• Wired Magazine already has undergone its redesign. Led by creative director Brandon Kavulla, it relies on “easy-to-scan geometry and forceful use of bold type and letterforms,” according to an editor’s letter. This is how Kavulla, a self-described “type junkie,” describes it: “Rather than simply changing the section logo or the bar at the top of the page, I wanted to force the whole page to change.”

• In May, Brides will unveil a redesign from new editor in chief Anne Fulenwider. She joined the title in September, succeeding longtime editor Millie Martini Bratten.

• Will a few changes in the art department at Vanity Fair result in a new look for the magazine in 2012? Last month, editor Graydon Carter hired T, The New York Times Style Magazine’s senior photo editor Judith Puckett-Rinella to become photo director, and in September, Chris Dixon replaced longtime creative director David Harris.

New Launch
Remember when models were replaced by actresses on the covers of magazines? These days, actresses are taking a backseat to reality stars such as Kim Kardashian for the covers of Glamour, Cosmopolitan and W. As WWD recently reported, the results have been mixed, but that hasn’t stopped American Media Inc.’s launch of Reality Weekly (the debut issue has Kardashian on the cover). It arrived on newsstands in late December with 500,000 copies, and in six weeks, that number will increase to one million. David Pecker, AMI’s chief executive officer, is betting that it will be a big hit, thanks to the $1.79 cost per issue. Check back here in a few weeks to see if he’s right.

New Leader
Laura Lang, former head of digital marketing firm Digitas, was named Time Inc.’s ceo last month. Lang has no experience in publishing (a positive or a negative, depending on whom you talk to), and the industry is waiting to see what her first big move will be. Lang’s presence at Time Inc. clearly indicates that the company is looking to optimize its ability to serve marketers. The rest of her game plan remains uncertain, at least for now.

New Trend
Get ready for a steady stream of stories about magazines and their new e-commerce initiatives. Last year, there were moves from InStyle, Elle, Vogue, Esquire and GQ, to name a few, and plenty more are in the hopper. Women’s Health launches its first Gilt Groupe sale on Friday, for example. Hearst is planning an e-commerce site tied to women’s fashion.

New Devices
Magazine executives have expressed boundless optimism about the tablet and what it means for the future of magazines. And this was before Amazon’s Kindle Fire was released in November. “There’s going to be this fantastic trade war between Barnes & Noble and Amazon and Apple that’s going to be an enormous benefit for the magazine industry,” said Hearst president David Carey, at an event in October. “Right now, we have 25 million print subscriptions in our company. And that complexion could change. Maybe one day it will be 22 million in print and 6 or 7 million tablet.” Meanwhile, Condé Nast president Bob Sauerberg said the company would bring in $15 million through tablet subscriptions and advertising by the end of 2011. This year will see if the momentum gathers pace.

New Resolutions
Finally, a look ahead to 2012 wouldn’t be complete without a few New Year’s resolutions.

Cosmopolitan’s editor in chief, Kate White, will continue her campaign to get Rachel McAdams on a cover. Apparently “The Notebook” actress isn’t interested, but White is upping the stakes this year, joking that “even if I have to give her my first-born son,” she’s willing to do anything. In between calls to McAdams, White said she will focus on getting 200,000 digital subscribers, another e-book bestseller and hit 10 million uniques on Cosmopolitan.com.

Joanna Coles, editor in chief of Marie Claire, is also tech-minded this year. She wants to learn to code HTML. After that, she’ll work on perfecting her martinis. “I tend to overshake them.” Coles, are you a fan of Bruce Lee? If so, perhaps you can share a few martinis over movies with Lucky’s Brandon Holley, whose only resolution is to watch Lee’s movies. “I’m newly and unexpectedly obsessed” said Holley.

Michele Promaulayko, from Women’s Health, can probably relate to Holley’s obsession, since she wants to learn how to meditate (Lee was a master of it). Promaulayko has hired a meditation coach to stay on track. “I’m determined not to fail.” But isn’t being anxious about succeeding at meditation a bad start?

Then there is Seventeen’s Ann Shoket, who picks one word each year and makes it her mantra. This year, it’s “brave.” “Being timid never gets you anything,” she said, which is a very Seventeen magazine kind of thing to say.

Martinis, movies and meditation did not make David Zinczenko’s list this year. “I resolve to stick to basic, sound judgments. After all, the easiest way to win is to stop making yourself lose.” Now that’s a Men’s Health kind of mantra if there ever was one.

wwd.com

 

[tarsha]

Glamour magazine will launch in Brazil in March 2012. The Editor-in-Chief will be Mônica Salgado former Senior Ed of Vogue Brazil.

twitter/fashionfoiegras

 

[liberty33r1b]

Magazines See Ad Sales Gains

MARCH MADNESS: Fashion magazine publishers have been desperate for some good news, following a particularly difficult end to last year. A small sigh of relief can be found in the March issues, which are posting solid ad page gains, almost across the board.

Once again, Vogue is ahead of the pack, reporting 442 ad pages in the March issue, up 16 pages or 3.7 percent versus March 2011. This follows a substantial increase in paging for the March 2011, up 50 pages, or 13 percent over the March 2010 issue.

Publisher Susan Plagemann said the January and February issues also posted small increases in paging and April is looking “solid.” “We’ve had growth in all fashion and retail is very strong,” said Plagemann. “We didn’t have any dips and captured the majority of pages in the market.”

Instyle is reporting 347 pages for the March issue, up 39 pages and 13 percent over last year. Publisher Connie Anne Phillips called it a “record breaker,” noting it was Instyle’s largest March issue in its 18-year history and builds upon a solid increase in March of last year, which reported a 20 percent increase in ad pages, to 308.

Elle will have 319 ad pages for March, up 2 percent from last year. “We’re up, we’re pleased, but it’s never good enough for me,” said publisher Kevin O’Malley. “The key drivers are luxury and prestige. As I’m looking deeper into this year, I see growth in American fashion and more on the European side. And I see growth in automotive — Buick, Infinity and Acura.”


Harper’s Bazaar wasn’t far behind, closing its March issue up 17 percent, with 271 ad pages. “We are embarking on a brand transformation,” said publisher Carol Smith.” The title is also introducing a redesign with its March issue. “We are rethinking this product from magazine to mobile to shopping. The new look very much calls on our past, as we look toward the future.” W has recorded four months of consecutive increases in ad paging, resulting in a 17 percent increase for the first quarter and 25 percent increase in ad pages, to 204, for March. “We’ll be up again in April, in May,” said publisher Nina Lawrence. “Eighteen months ago, it was just a beautiful magazine. Now, it’s a fully developed brand. Our social media platforms and Web site uniques are now, alone, bigger than our print rate base. As they should be.”

Marie Claire and Glamour are tied in the ad page race, each posting 181 pages for their March issues. For Marie Claire, this will be its largest March issue in its history, up 31 percent versus last year, driven by a 25 percent rise in fashion pages and 30 percent increase in the beauty category. New advertisers include Louis Vuitton, Bulgari, AG Jeans, MAC, Smashbox and Botox. Glamour reported a nine percent increase, making March its second largest book in 20 years.

Lucky magazine was the only fashion title to post a decline in paging for March, down 21 percent to 106 pages. It’s unclear why the title posted such a dramatic decrease, although this issue was competing with editor in chief Brandon Holley’s first issue in March 2011. As with most magazines, beauty pages were up but retail was down, with Target not advertising during the first quarter and the Sears/Kmart business was also down.

wwd.com

 

[tigerrouge]

[Harper's Bazaar] "Now, it’s a fully developed brand. Our social media platforms and Web site uniques are now, alone, bigger than our print rate base. As they should be."

I wish magazines would just concentrate on producing a decent magazine each month, instead of fannying about with stuff, under the guise of these things being "the future". No, most of it is nonsense and empty noise, if you can't get the core basics of your brand right, and that means taking the printed page and putting something inspirational on it.

 

[Melancholybaby]

^That quote refers to W not Harper's Bazaar, although your comment could apply to both magazines.

 

[wild roses]

Somewhere Gloria Steinem is saying "I told you So!"

I'm annoyed with it as well. Even non-fashion magazines are trying to brand themselves (Smithsonian's new editor discussed readers as being "consumers" and how he wants to expand business in a recent editor.)

I don't mind magazines using online media, but they should use it as a extension of the magazine rather than as a "look who advertised with us this month. You need to buy from them." Magazines have always done that...but it's getting really out of control now.

 

[tigerrouge]

^That quote refers to W not Harper's Bazaar, although your comment could apply to both magazines.

Indeed it does, so much for my speed reading... I think it's easy for people to become overly involved with 'achieving' things on the internet without really achieving that much, and it's an arena where nearly everyone's pretending they know what they're talking about, when it's more a case of them trying to sound confident about things they don't really have a firm handle on, because nobody does.

And these people might consider it old-fashioned to focus on print publications because 'nobody reads them anymore' but if a company can't show respect towards the most basic element of its own brand - the original magazine - then I don't hold out much regard for the house of cards it's trying to build on top of that.

 

[JustABoy]

These comments about print vs. web are specious and naive.

First, no major fashion magazine is canceling its print version, and trying to create a digital presence doesn't show a lack of "respect" for the print product. Second, improving a print version isn't incompatible with launching a digital version--in fact the same teams of people probably aren't even involved. Third, of course Smithsonian magazine is interested in cultivating a brand identity and making it accessible online -- try to find a large company that doesn't.

I don't see how anyone could doubt that traditional media companies will have to figure out a way to recreate and improve upon their products in digital form. Look at what Apple has done to CD sales. Look at what Amazon did first to bookstores, and now to book publishers since it has started to publish its own content. Look at what hulu, netflix, et al. have done to traditional methods of distribution for TV shows. Look at what net-a-porter, gilt groupe, bluefly, etc. have done to the sale of luxury clothes. Maybe they haven't run their competitors into the ground, but they are eating up market share, for one thing, and for another, completely changing the way we can access luxury clothes. 15 years ago do you think barney's had as a nice a website as it did now? 15 years ago we were all buying CDs, hardcover books, and renting movies at blockbuster.

Point is, looking at how digital companies have completely transformed the way business is done in traditional industries, it would be foolish to conclude that the best way for magazines to improve and thrive would be to focus on print products. Print products can be improved while digital presence is improved, and a company that only focuses on a non-digital presense is dooming itself to either be small forever or just fail outright.

 

[tigerrouge]

Nobody was talking about making a bonfire of keyboards and trying to pretend the internet was never invented, only that companies, in their haste to spout all the right-sounding things about what they're going to do online, shouldn't neglect their print publictions, and the need to find innovative ways to keep that medium fresh and appealing as well.

It's a deeply unfashionable thing to say, because it's drummed into us that the internet is the all-consuming future and if we don't sound deeply informed and absolutely confident about what's going to happen, then we're out in the cold... when that approach is specious and naive in its own way.

I think I'm turning into the Ted Nugent of tfs. These March issues need to come out soon, so I can stop hanging around and arguing for the sake of it.

 

[BerlinRocks]

There was a little scandal in France about an article published in Elle FR, that article was about black women. I don't know where to publish it, but I'd love to share it on tFS.
may I publish it here ?

Friday, January 27, 2012 11:29 AM EST
French Elle Slammed for Racist Article Calling Obamas the First Fashionable African-Americans
By Cavan Sieczkowski

French Elle is currently under fire for what has been interpreted as a racist blog post. A blogger for the publication wrote a piece about Michelle Obama's fashion flair and the rise of "black-geosie," insinuating that the Obamas are the first fashionable African-Americans.

"In this America led for the first time a black president, the chic has become a plausible option for a community so far pegged to its codes [of] streetwear...But if in 2012 the 'black-geoisie' has integrated all the white codes, it does not [do so] literally. [There] is always a classic twist, with a bourgeois ethnic reference (a batik-printed turban/robe, a shell necklace, a 'créole de rappeur') that recalls the roots," wrote Elle blogger Nathalie Dolivo.

"Black-geoisie" refers to the Obamas' style of dressing "white" yet maintaining their "blackness" through the use of symbols--like a shell necklaces, robes or turbans. Dolivo suggested that America's first black president and his family give the black community a "chic" option rather than "streetwear codes."

"Michelle Obama sets the tone, focusing on cutting-edge brands...revisiting the wardrobe of Jackie O in a jazzy way," wrote Dolivo. She continued with saying that black women use fashion "as a political weapon" and have "returned to style as a source of dignity."

Criticism quickly flared as more people caught wind of the tacky and offensive post. "How, in 2012, in a France where there are at least three million blacks and mixed people, can you write such nonsense? You are too kind when you write that in 2012 we have incorporated the white codes...what do you think, in 2011, we dressed in hay and burlap bags?" commented one reader (via NY Mag).

"The person who wrote this article is very limited, both culturally and intellectually. The sad part is that it really has the feeling of beingpositive [sic]. [Ms. Dolivo] I think you should travel a bit more and broadenyour [sic] horizons," wrote another.

"Your article is a very poorly written, but it perfectly reflects your state of mind. Fashion has no boundaries or color, and it's a terrible admission of failure to see that [French Elle] can be reduced to such amalgams...Black women are beautiful and elegant, [and do] not need magazines to tell us what to wear, we dress with taste and class and we have always done! This article is nothing but a bunch of clichés, without any interestor [sic] informative journalism...Thumbs down!" said another.

Others explicitly blasted the writer.

"[This is] GROTESQUE, SHAMEFUL, and USELESS. White dress codes? Did I really read white dress codes..?" wrote one angry reader, while another added, "You really think we waited until the Obamas to know style and let go of our 'streetwear' proclivities?"

Not only were Dolivo's critiques racist, they were wholly inaccurate in their claims.

"While Michelle Obama has been known to wear African-influenced jewelry and support young black designers, it's far less accurate to define her wardrobe as 'batik' robes and turbans," noted NY Daily News writer Lindsay Goldwert.

The outdated stereotypes proved Dolivo's knowledge of fashion to be haphazard, if not obsolete.

"The truly flustering passage [is] when she attributed black modern dress to white dress codes, then ventures to say we 'afro-centrize' our looks with shells and 'boubous'. Some of us do, some of us don't. We are not one monolithic group to be written about like zoo animals. I. Just. Can't," wrote fashion blogger Claire Sulmers for Fashion Bomb Daily.

The article has since been removed from French Elle's Web site.

ibtimes.com

 

[tigerrouge]

Amid the emergence of March issues and the promise of redesigns, here's what publisher Felix Dennis had to say about the price of failure in his book How To Get Rich (typed by me

Believe it or not, there are magazines that have been propped up on life-support by large publishing companies for years. The executives will be fully aware that their magazine is not viable and will never be viable. Let's say it is losing $3 million a year. Why not close it without further ado?

The answer is closing costs. The hidden cost of failure.

In our example, the cost of shutting down the magazine will far exceed the three million it costs to keep the wretched rag just breathing. Why so? Because magazines sell large numbers of subscriptions to readers. In America, these 'subs' are often sold at a knockdown price to encourage the appearance to advertisers and others of growth. It is a foolish practice, but it is ubiquitous.

Even if the magazine's 'subs' price is a reasonable one, there have been numerous cases of a form of petty 'bribery' where potential subscribers are wooed by publishers to subscribe with the offer of a free clock or reduced memberships to health clubs and so on. These cheap prices and 'free gifts' create a massive liability in the publisher's balance sheet – which is fine as long as advertising continues to pour in. But when the magazine is no longer flavour-of-the-month and advertising is falling off, the misery begins.

Let us say a dying magazine has a million subscribers. Most of them are not 'real' subscribers, but, even so, they have paid their dollar per copy and are owed, on average, six more issues.

This means the cost of reimbursing the subscribers alone will exceed $6 million in refunds. (It will exceed it, by the way, because of the huge cost of collating and mailing the refunds to a million people.)

Of course, the publisher will also face other closure costs, including redundancy payments to magazine staff, rebates to advertisers and possibly to printers and paper merchants and a host of other creepy-crawlies that will come slithering out of the woodwork when news that the ship is sinking spreads abroad. In all, sudden-death closure costs might be as high as $8 million.

The publisher's only hope is to cut costs to the bone, cease soliciting any discounted subscriptions, fulfil the subscriptions with very thin, very cheap editions of the magazine – now a shadow of its former self in quality and number of pages – and thereby reduce what, in the jargon, we call the 'subs liability'. This can only be done is the poor beast is still technically alive.

In the meantime, the publishers hope that many staff will not wait to be fired but will seek other jobs and reduce closure costs by reducing redundancy payments. It took one of the largest magazine publishing corporations in America over five years to bring about the closure of what was then still one of the best-known magazines in the world. It lost money for every one of those five years. Let's take a look at why.

Over five years, in our hypothetical example, losses total $15 million – surely more than the cost of instantly shooting the brute? Yes, but that $15 million will have been spread out over those five years. The parent company can afford to carry such a burden. Profits will only be slightly affected each year and senior executives will still receive their precious annual bonuses. Even better, the share price will suffer mildly, if at all. On the other hand, if the full $8 million (or more) for sudden death was charged in a single year, not only would the senior management's bonuses evaporate (horror of horrors!), the share price would probably take a hit from negative publicity and profit-and-loss considerations.

But how can it be good for a company to waste the difference between $8 million and $15 million for an asset going nowhere? The medium- or long-term answer is that it isn't good. The company will have squandered $7 million (more, with inflation taken into consideration) and clogged up its managerial focus with a deadbeat property. But the short-term answer is that it's probably the best thing to do in the circumstances. Not to mention that in larger corporations, the short-term is often the only term senior management, goaded on by share price 'analysts', can bring itself to care about.