In its efforts to find a buyer for Newsweek, The Washington Post Co. has enlisted the financiers at Allen & Co. to put together some more details on the magazine’s money situation. paidContent got its mitts on the documents.
• A spring 2010 redesign of the Newsweek website
• Mobile apps for the iPad and other devices are in the works
Clearly, Newsweek sees its digital presence as an important component of the business going forward. That’s smart; its forays onto new Web platforms like Tumblr have been the subject of praise from media observers, including FishbowlNY.
For now, though, the breakout of Newsweek‘s first-quarter results suggests that the digital business needs improvement. The segment called “Digital” cost $2.6 million in the first quarter of 2010, while “Digital Advertising” brought in far less — $1.3 million. Those two numbers don’t tell the whole story, obviously, but they also paint a scary picture for what is arguably one of the magazine’s more promising properties.
From a broader financial perspective, the sales kit does little to assuage existing concerns. paidContent points out what amounts to a shoulder shrug from The Washington Post when it comes to any turnaround ideas:
Management believes that Newsweek can regain profitability through additional cost savings and revenue enhancements. Potential buyers may realize additional cost savings depending on the nature of their operations.
The documents also indicate that The Washington Post is willing to hang on to Newsweek‘s pension obligations and other employee-related liabilities.
Initial bids are due by close of business on June 2.