AOL Time Warner Gets Down to Business 2.0
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Following months of discussion, AOL Time Warner's Time Inc. unit said Thursday that it would purchase ailing new economy business magazine Business 2.0 from its publisher Future Network.
Neither company would disclose the amount of the purchase, though sources close to the deal confirm that it was well below earlier offers AOL had made to Future Network -- evincing the U.K.-based publisher's eagerness to drop the magazine, following continued weakness in the technology advertising market.
Time said it would merge biweekly Business 2.0 into its Fortune Group, with the year-old monthly eCompany Now, with the goal of relaunching the combined monthly magazine in September under the title Business 2.0 and with a subscriber base of about 550,000.
Prior to the acquisition, eCompany Now published monthly, with a circulation of 375,000, up from 200,000 when it launched in June 2000. Business 2.0 was publishing a biweekly magazine with a circulation of 350,000.
While Business 2.0 -- like most other Internet and new economy-focused publications -- had been hard hit by the slowdown in advertising spending from defunct dot-coms and cash-strapped technology firms, Time Inc. said that its eCompany Now publication has been performing successfully.
The company didn't give specifics of that performance, but attributed a good deal of it to promotion across other properties owned by corporate parent AOL Time Warner. Since its launch last summer, AOL had pushed eCompany Now on several of its Web properties and its America Online service, which it said helped generate a million pageviews monthly.
Consequently, AOL said it would also support the launch of the revamped Business 2.0 with special promotions, links, and content support across America Online and its associated properties.
"Our success with eCompany Now has convinced us that there is a vibrant community of readers for a 'next-generation business magazine,' one with a different perspective and attitude than the more traditional business books," said Fortune Group editor John Huey. "Drawing on the resources of Time Inc. and AOL Time Warner, we are wholly committed to making Business 2.0 the voice of this business market, and number one in its space, just as Fortune is the leader in its category. Our journalists see this as a great opportunity to continue developing a distinctive approach to new kinds of business coverage."
The new publication will be headed by Ned Desmond, who will go from editor and president of eCompany Now to hold the same positions at Business 2.0.
AOL didn't specify whether there would be additional cuts made from the 80-or-so editors remaining at Business 2.0 -- the publication has had several rounds of layoffs to date -- though a source at eCompany Now said the publication already is "pretty much staffed to where [the publishers] want it to be."
Nevertheless, the Future Network's founder, Chris Anderson, said in a statement that "everyone associated with Business 2.0 should feel great pride in today's announcement."
"In just three years, a major brand has been built," he added. "As part of Time Inc. and The Fortune Group, Business 2.0 has assured its own future as one of America's most influential and valuable business magazines."
While Anderson is right in that Business 2.0, over its two-year history, has become one of the more recognizable new economy business publications, it's still cold comfort to any staffers who don't make the cut.
The purchase is subject to various closing conditions, including regulatory approval, AOL said.