PENTHOUSE Editor-in-Chief Mark Healy is out, heading over to GQ from whence he came.
Although Penthouse President and Publisher Diane Silberstein had high praise for Healy, the magazine’s owners were apparently less pleased about his decision.
“I never got escorted out of a building before,” said Healy, who earlier this week gave his bosses two weeks’ notice but yesterday was walked out of Penthouse’s offices.
Healy had the job for about a year, having been recruited from GQ by Penthouse’s new owners to lead the magazine away from being about hard-core and explicit sex toward being simply a men’s magazine about sex. At GQ, Healy had been a mid-level articles editor.
Marc Bell Capital Partners of Boca Raton, Fla., acquired the magazine in 2004 after Penthouse founder Bob Guccione lost control of parent company General Media and was forced to liquidate the company. Marc Bell, the acquirer’s managing director, is also Penthouse’s CEO.
Sources close to Healy said that he had become increasingly frustrated by the constant strategy changes being mandated by the magazine’s owners.
“They [the owners] were non-publishing people, and the place was worse-run than when Guccione was there,” said one source. “They seemed to be more interested in TV and the Internet than in the magazine.”
The source added that management recently has begun to veer back toward making Penthouse a hard-core sex magazine.
Said Healy: “I think we did a lot of good work and got a lot accomplished, but the magazine they want to do [now] they don’t need me to edit.”
At GQ, Healy will have the title of director of editorial projects.
GQ Editor-in-Chief Jim Nelson said Healy’s focus will be “special issues, work on the Web. I see him as a very original thinker and I think a lot of the long-range thinking he did as editor-in-chief of Penthouse will come in handy here.”
Nelson is hard at work closing GQ’s controversial Men of the Year issue for November. Bill Clinton is on the cover.
Meanwhile at Penthouse, Silberstein, the publisher, said that the Penthouse Media Group is profitable, deriving the bulk of its income from entertainment, which includes videos and pay-per-view movies.
The magazine, which once had a circulation in the millions and rivaled Playboy, now has dialed back its circulation to around 370,000.
House unrest
The top brass at Condé Nast is said to be giving House & Garden intense scrutiny in the wake of the defection of Publisher Joe Lagani to Glam Media, which boasts of having the Internet’s top women’s Web site, glam.com.
Lagani is becoming a vice president and general manager of Glam Media.
Losing an executive to a rival media outfit whose main business is Web-based is a double embarrassment for Condé Nast, which over the past year has stepped up its investment in its Web properties, which include style.com and flip.com.
What’s more, sources said that Lagani’s departure took the Condé Nast brass by surprise and that no replacement has been lined up.
The problem at Condé Nast, according to one knowledgeable source, is that the shelter category has faced a difficult market and that House & Garden has been a money loser over at least the past four or five years.
A while back, Condé Nast Chairman S.I. Newhouse Jr. would have been willing to stick with a magazine through thick and thin on the grounds that Condé Nast is a privately held company with no cranky stockholders to satisfy.
These days, however, the company has shown an increased willingness to pull the plug on magazines that underperform over long stretches, including Jane, Cargo and Vitals/Vitals for Women.
House & Garden was shut down after bleeding money in the early 1990s recession. Then it was brought back amid much fanfare in 1995 with Dominique Browning as editor-in-chief and David Carey running the business side. Carey is now the president and publisher of Condé Nast Portfolio.
For a while, things seemed to click. But the magazine has sputtered in recent years.
In the nine months ended on Sept. 30, the magazine dropped 1.4 percent in ad pages to 623.97 after rallying last year to 845.97 ad pages for the same period.
However, most big titles at Condé Nast need to generate at least 1,000 ad pages to be considered healthy and the last time H&G was in that range was in 2002, when it sold 1,000.3 ad pages. The big tumble occurred in 2003 when it dropped 13.6 percent to 866.
Sources said that Condé Nast’s brass is fretting they might have to shake up the editorial side, starting with replacing Browning, but realize it’s risky to do that while a new publisher is getting acclimated to the magazine. Usually a new publisher is given at least a year to get oriented to the terrain.
“The publisher switch lets the editor dodge another bullet,” said an insider.
In the black
Could American Media be close to generating a profit?
During talks with bondholders Wednesday, executives predicted that it would have a profit of $960,000 for the quarter ended Sept. 30. A year ago it lost $4 million.
The company has slashed costs, but is also increasing revenue slightly, executives claimed. The headcount is down 17 percent from March 2006, when it had 879 full-timers. Today, it has 729 full-time employees.
AMI CFO Jack Craven even joked with bondholders, “I think this is the first time in nearly two years that David [Pecker, AMI’s CEO] and I haven’t been asking for waivers.”