It’s now Ti me for a ‘transformation’ officer
TIME Inc. is about to name a new C-suite executive — a chief transformation officer, Media Ink has learned.
The move is expected to be made by next week’s earnings report, according to well-placed sources.
The new job will be part of a new initiative of cost controls, divestments and some investments as the publisher of Time, Sports Illustrated, Fortune and InStyle scrambles to re-position itself against the backdrop of ever- shrinking print ad revenue.
The CTO will be charged with implementing many of the recommendations made by consulting giant McKinsey & Co., sources said, including shaving $300 million in costs. McKinsey has been poking around the nation’s largest publisher for months, sources said.
Time Inc. has never officially confirmed McKinsey’s presence. Internally, the consulting firm has been known only by its code name, K2.
As part of the streamlining, Time Inc. this week is expected to hold preliminary talks with potential suitors or partners for its massive data operation, the Tampa Customer Service division, which employs 700 people.
Meridian Advisory Group (MAG), not McKinsey, is the consulting firm overseeing the Tampa review, Media Ink has learned.
Time Inc. could end up selling the Tampa division, sources said, or entering a partnership/outsourcing deal.
Among the firms interested in the Tampa operation are: HCL Technologies, Tata Consultancy Services, Tech Mahindra and Infosys. Each is based in India. A fifth company expected to kick the tires, Cognizant, has offices in Teaneck, NJ, but has 155,000 of its 255,000 worldwide employees based in India.
Hitting up Rodale
Bids for Rodale, publisher of Men’s Health, Prevention, Runner’s World and other titles, are due Aug. 3.
Meredith, Hearst and Bonnier are said to be in the hunt. Ziff Davis, which made a big bet on digital health, is also looking, but is an all-digital publisher and is not interested in print.
American Media Inc. is only interested in bidding on Men’s Health.
Bids could range from $125 million to $150 million, sources said — even though Rodale has profits of only $17 million on revenue of $225 million.
Street rebound
James Cramer’s struggling f inancial news site, The Street, has stopped its losing streak and posted a slim profit of $300,000 in the second quarter — its f irst quarterly profit in two years.
A year ago, it lost $1.2 million. Revenue fell 2 percent, to $16 million.
The last time the company posted a full-year profit was in 2008, before the recession.
“Our turnaround is gaining momentum,” said David Callaway, president and CEO. “Costs are down. Cash is up. B2B revenue, and importantly deferred revenue, continues to rise, and our news coverage is attracting advertisers. On the subscription side, we’re paring losses and seeing improvement each week.”
But the company is far from out of the woods.
After its stock fell below $1 for 30 consecutive days in mid-June, it was moved from the Nasdaq Global Market to the Nasdaq Capital Market, considered the junior varsity.
The Street’s shares closed Tuesday at 82 ¹/2 cents. It will have to close above $1 for 10 straight trading days or face another potential de-listing threat from NASDAQ by mid-December.
Latina lament
Latina Media Ventures has had its bank account at Citibank frozen, prompting employees’ and freelancers’ checks to bounce again — and its top executives to stop returning calls to press and employees.
Its money woes have also apparently forced the company to cancel the July/August issue of Latina, its flagship title, marking the second month in a row it has skipped an issue.
It earlier canceled the May/ June issue after delaying the March/April issue until June.
Only last month, the company, majority owned by the private equity firm Solera Capital, vowed to pay all of its employees and freelancers, and straighten itself out. As of June 30, it had paid all employee back pay, but had not paid freelancers.
One freelancer said that a four-figure check bounced last week after being held by her own bank for several days.
Molly Ashby, CEO of Solera, did not return a call. A public relations representative at Kekst & Co., which had been fielding calls in recent weeks, also failed to return calls over several days.