Posted by: Jon Fine on July 12, 2006
Just had a chance to chat with Steve Newhouse, who as chairman of Advance.net heads up all internet operations for Conde Nast and Advance Newspapers, and who sounds legitimately excited about his company’s purchase of Wired News from Lycos for $25 million.
The deal reunites the print and online arms of Wired under one roof. Conde Nast, you may recall, actually bought Wired Magazine, and Wired Magazine only, back in 1998 for about $80 million. It seems rather stunning today that they didn’t buy the digital portion of the business—actually, it is rather stunning, and it explains why they’ve made many efforts over the years to buy what was once called Wired Digital. Still one executive involved at the time said that the asking price for the online unit was substantially higher than that of the magazine alone, which would explain why in mid-1998 Wired found at least two bidders for the magazine but none for the online businesses. (Remember this all happened in an earlier era of dotcom wackiness. Wired tried to go public twice as a multimedia play in 1996, once at a valuation of $450 million—this, for a company that lost $6.5 million on $25.2 million in revenue in 1995. Wired’s online operations posted substantial losses on $1.9 in revenue in 1995; the agreement yesterday between Conde Nast and Lycos did not disclose any financial data.)
The perversity of the arrangement was perhaps best exemplified in the office layout itself, in which staffers for the magazine and Wired News worked for the same brand, on the same floor as each other, but for different companies. For eight years. (UPDATE 7/13: Actually no, it turns out. Wired’s online staffers moved out in the mid-Nineties, and only moved back last year.)
That’s all settled now. So what, exactly, does Wired News become?
It’s worth noting that the next big Web initiative from Conde Nast will be its still-upcoming teen site, which will consist almost entirely of user-created content. (Can we please coin a better term than that?) Judging from what Newhouse says, that’s going to play a big role in the new Wired News as well. “One of the things we haven’t done yet, but we are deep into thinking through, is the combination of giving the audience tools to create content and giving them the ability to network with each other.”
“For me, Web 2.0 is a way of saying ‘let’s empower the audience and help them to build the site.’ That’s [already] started at Wired News, but that could be a truly amazing opportunity.”
But to steal what Om Malik says, the happiest guy in the room is probably Wired Editor In Chief Chris Anderson, who now has an Actual Web Property to play with, after all these years of editing a magazine about the many dimensions of a digital future without one.