Talks to sell Whole Living to OpenGate Capital and Jack Kliger collapsed at the 11th hour — pushing Martha Stewart Living Omnimedia to shutter the publication.
Staffers were given the sad news yesterday afternoon.
As talks concerning the $2.5 million sale to OpenGate were cratering, Martha Stewart was seen partying at Art Basel in Miami on Wednesday night.
“The business was losing too much cash and needed a lot more to operate it as a going concern,” said Andrew Nikou, CEO of OpenGate, which owns TV Guide.
Cash-strapped MSLO was in no position to put together a seller-financed deal. Whole Living was said to be losing about $4 million a year.
With its 750,000 circulation, the title was in an advertising no-man’s land. Its circulation was not quite large enough to attract a large number of big advertisers, but too large and expensive for many of the smaller advertisers who supported it when it was still known as Body + Soul.
MSLO paid about $6 million for the mag in 2005.
Sixteen editorial staffers, including chief editor Alanna Stang, who had been hoping a new owner would keep them on board, now face a layoff just in time for the holidays.
The company warned on Nov. 1 that it was trimming its publishing portfolio to just Martha Stewart Living and Martha Stewart Weddings and that it would fold magazines if it could not find buyers for them.
MSLO said it would use the content of the closed titles in its other publications.
A second magazine, Everyday Food, was also going to stop publishing on a standalone basis as part of the restructuring. It will appear as an insert a few times a year.
The January/February issue of Whole Living will be its last, Martha Stewart CEO Lisa Gersh confirmed to the staff.
Beast cuts
Layoffs at Newsweek Daily Beast that Tina Brown began implementing yesterday afternoon could eventually reach 65 people — or more than a quarter of the 270 people working on the combined staffs, insiders tell Media Ink.
The cuts are being made as Newsweek gets ready to stop producing a print edition of the magazine. Brown said that the cost of producing the weekly was $45 million a year. Losses were extensive — believed to be running in the $40 million-a-year bracket — prompting the parent company, Barry Diller’s IAC/InterActiveCorp, to make the move to all digital.
IAC is a web-only company with holdings ranging from Ticketmaster to Ask.com and About.com.
The cuts did not exactly take anyone by surprise, although some of the names heading out the door did.
A few hours before the layoffs began, Brown had unveiled the new post-print management team.
Justine Rosenthal, who was executive editor, moves up to editorial director of the Newsweek Daily Beast Company. In her new role, Rosenthal will be responsible for special issues of Newsweek Global, and with developing new editorial content streams, Brown said.
Tunku Varadarajan, who was editor of Newsweek International, will become editor of the all-digital Newsweek Global.
Deidre Depke is being promoted to editor, The Daily Beast.
Separately, as the Newsweek Daily Beast begins to look to the future without the printed magazine, it is expected to erect a paywall.
The arrangement will allow readers to see a number of articles for free, but charge them for full access.
The worry inside is that traffic, which the company said has been at an all-time high, will fall off without a print companion.
A spokesman confirmed only that several strategies, including a paywall, are being considered.
WaPo paywall
The Washington Post, which until 2010 owned Newsweek, is also said to be finally getting ready to move to a partially metered paywall, according to the Wall Street Journal, which cites sources familiar with the talks.
That would be a major reversal for Washington Post Co. CEO Donald Graham, who had resisted such a move.
The plan will allow a limited number of free views per month and then require readers to pay.
The New York Times and the Wall Street Journal have paid websites. USA Today does not, although parent Gannett has been converting its local daily papers to a paid model.
Fay-d out
Should Eddie Fay see Eddie Fay?
For decades, when someone was fired or took a buyout at the Daily News, one of the final stops he’d make was the office of Eddie Fay, the longtime vice president/director editorial administration.
Yesterday, word spread in the Daily News newsroom in Jersey City, NJ, that Fay was leaving after 44 years. Fay, 63, is believed to be the longest-serving staffer at Mort Zuckerman’s Daily News.