Q & A with Norman Pearlstine
Norman Pearlstine has been editor-in-chief of Time Inc. since 1994. Here are excerpts of a conversation with Neil Hickey.
Neil Hickey: Where is Time Inc. headed in the years just ahead?
Norman Pearlstine: If you're going to continue to deliver the kind of growth that's expected from us, you have to do launches and acquisitions that grow your company, and you have to watch your costs pretty carefully.
Print remains viable and vibrant. We've gone from forty to 140 titles in the last two years. I believe in print and I also believe in electronic distribution and the online world. I'd love to see us come up with some exciting magazines that grow out of an editor's imagination, and are such compelling ideas that readers, advertisers, and our business colleagues would all rally behind them. I don't think we've done as good a job as we might on that.
The rationale for the AOL-Time Warner deal was that huge synergies would result. How is that working out?
I would say it's gone slowly in the first couple of years. Big mergers are hard to pull off. They take time to figure out. Our magazines have gotten a hundred thousand subscriptions a month via AOL. That's not insignificant, but you wouldn't do the merger just for that.
Yes, there's been some discontent about the merger, lots of speculation about whose stock would be where, had we not merged. You have to ask yourself, if this was such a bad idea, why were Microsoft and Disney so adamantly opposed? My sense of media today is that bigness will matter. It's fashionable to say it doesn't but it really does.
People can argue about the stock valuations, but I have no second thoughts at all about the merger. I'm a big fan of it. We've had some tough business conditions ourselves these last few years, where we haven't had the kind of growth we had in the late nineties.
When I was at Dow Jones, we thought it was a really big deal that 1.6 million people paid over $150 a year for a subscription to The Wall Street Journal. That was something you could take to advertisers. AOL has 35 million subscribers and a large number of them are paying well north of $200 a year. That's staggering to me. And I think they're just beginning to figure out what those customers want.
A restructuring in July has made Don Logan, former chairman of Time Inc., boss of the AOL division and other units. Can one be forgiven for thinking that old-media people are back in the driver's seat?
Of course. But I never thought that the battle was between old media and new media. What I think is, they've identified the single best business executive I've met in thirty-five years in the news business, and said let's give this guy some more room and more to do.
How does it feel to be allied with a division that's under investigation by federal regulators?
The answer is, it feels lousy. I wish we weren't going through it. To the degree that it's a story, I hope we cover it aggressively because that's part of our mandate.
