Magazines And The Hearst Media Conglomerate In The 1990s

(The following article first appeared in the 9/9/92 issue of the now-defunct Lower East Side alternative weekly newspaper, Downtown.)

Of the $3 billion in gross annual income that the Hearst media conglomerate earned each year during the 1990s, about 50 percent came then from Hearst’s Magazine Division. [In the 21st century, the Hearst media conglomerate’s gross annual income is now between $4.1 billion and $4.5 billion.] Besides Cosmopolitan, Good Housekeeping, Redbook, Harper’s Bazaar and Esquire, Hearst’s Magazine division also marketed Town & Country, House Beautiful, Sports Afield, Popular Mechanics, Colonial Homes, Country Living and Motor Boating & Sailing in the early 1990s. [In the 21st century, the Hearst media conglomerate now also markets O, The Oprah Magazine.] In the late 1980s, Forbes magazine estimated that Hearst’s magazine business was then worth over $1.1 billion and that around 250 million copies of Hearst magazines were then being sold each year. Cosmopolitan was generally the Hearst media conglomerate’s biggest money-maker during the last thirty years of the 20th century, although Good Housekeeping and Redbook had larger circulations.

Hearst’s Magazine Division also made money during the 1990s from marketing seven magazines in Britain and 56 foreign editions of its U.S. magazines (including South African editions that it had sold in South Africa during the apartheid era), and from operating two U.S. magazine distribution companies—Eastern News Distributors and International Circulation Distributors—and two U.S. subscription fulfillment companies. Because Hearst owned its newsstand distribution operation it had more special power to get one of its newly-created or newly-acquired magazines onto newsstands and keep it there during the 1990s than competing magazine publishers did. Magazines like Cosmopolitan were also produced in Spanish-language editions by publishers who paid to be specially licensed by Hearst to reproduce its magazines in Spanish.

Another reason Hearst’s most consistently profitable division had been its magazine division was that it had been able, historically, to reduce genuine economic competition in the U.S. magazine industry. As The Hearsts: Family And Empire—The Later Years by Lindsay Chaney and Michael Cieply noted in reference to the businessman who managed the Hearst media conglomerate for the Hearst family from the early 1930s to the early 1970s, Richard Berlin:

“Dick Berlin had a philosophy about competition in the publishing business—it wasn’t good for business…Competing magazine publishers frequently engaged in rate-cutting in order to lure advertisers away from each other…Berlin summarized his attitude in 1941 when he wrote to [William Randolph] Hearst [I] telling him that he had just met with the publishers of McCall, Curtis and Crowell in an effort to pound some reason into them and get them to increase their rates. In that case, Berlin was successful, and the other publishers eventually did increase their rates to match the Hearst publications.”

(Downtown 9/9/92)

Next: Cosmopolitan’s Television, Radio and Cable TV Connections In The 1990s

`Cosmopolitan''s Historic `Esquire' Connection

(The following article first appeared in the 9/9/92 issue of the now-defunct Lower East Side alternative weekly newspaper, Downtown.)

Although Hearst’s Cosmopolitan, Good Housekeeping, Redbook and Harper’s Bazaar all pose as magazines which express a competing “female” editorial viewpoint to that generally found in magazines like Esquire magazine—which was marketed to 700,000 primarily male subscribers in 1992—Hearst also has owned Esquire magazine, historically.

After briefly attempting to market a new men’s fashion magazine called Men’s Bazaar to compete with Esquire for men readers, Hearst decided it would be more profitable to spend more than $60 million [in 1980s money] to buy the competing publication. And after it purchased Esquire in 1986, Hearst discontinued its publication of Men’s Bazaar.

Coincidentally, six months before Esquire was sold to Hearst, Esquire’s then-chief operating office [CEO] and one of its then-major shareholders—Wilma Jordan—married a top executive in Hearst’s Magazine Division at that time, George Green. And after negotiating the deal to sell Esquire to her new husband’s company, Esquire’s former CEO, coincidentally, received between $6 million and $7 million of the $60 million Hearst dished out to purchase Esquire.

Although in April 1987, Esquire’s then-editor, Lee Eisenberg, told New York magazine that Esquire’s new corporate owner was “uniquely right for us—nonbureaucratic, with no desire to impose a monolithic `Hearst culture,’” by the Fall of 1990, Esquire’s editor was Terry McDonell, not Eisenberg. McDonell was the first Hearst magazine editor-in-chief to be hired by then-Hearst Magazine Division President Bahrenberg. Esquire’s then-managing editor, Ellen Fair, was also shifted out of Hearst’s Esquire office in 1992 and into the managing editor slot of one of Hearst’s women-oriented magazines after 14 years of working for Esquire.

Asked by Downtown in an August 1992 telephone interview if Hearst’s purchase of Esquire had affected the magazine much, the then-editor, Terry McDonell, noted he “wasn’t around” the magazine at the time Hearst purchased it, but “I believe that Hearst had made the magazine more profitable and, editorially, we’ve done well.” The then-Esquire editor asserted that “the magazine is driven by journalism” and not by the special interests of the Hearst Corporation.

Asked by Downtown in 1992 whether he felt being part of the Hearst conglomerate created possible conflicts of interest for Esquire, McDonell replied: “Their interests are those of a media company and we are not a media watchdog publication. And we don’t do articles on women’s magazines, which is what Hearst publishes.”

The then-Esquire editor said he had never experienced interference from the Hearst Corporation or the Hearst family with regard to editorial content and felt no pressure with regard to coverage of the Hearst family. According to McDonell, the only concern of the Hearst Corporation with regard to Esquire magazine was that it continue to be an economically profitable publication. And McDonell felt that—despite its Hearst corporate connection—Esquire still was “very unique” as a magazine.

(Downtown 9/9/92)

Next: Magazines And The Hearst Media Conglomerate In The 1990s