(Bloomberg) -- Time Inc. is planning a major reorganization focused on web video, live events and working closely with marketers, according to a person familiar with the plans, as the publisher of People magazine tries to transform itself for the digital age.
The company, which also owns Sports Illustrated, Travel + Leisure and Fortune, recently bought Viant Technology Inc., the owner of Myspace, to get more data to help sell targeted advertising. It also launched a new site, Motto, focused on millennial women, and has been posting more videos on social media platforms like Snapchat, Instagram and Facebook Live.
In a recent earnings call, Time CEO Joe Ripp said the company was seeing “rapid adoption and engagement of live video” on Facebook. “Time Inc. is positioning itself to become a major player in digital video,” Ripp said during the call.
In the first quarter, Time's total advertising revenue rose 2 percent from a year earlier to $360 million, as an increase in digital sales offset a decline in print ads. At the same time, circulation revenue fell 5 percent. Shares of the New York-based company have plunged 30 percent in the past year.
In a recent note to clients, Wells Fargo analyst Eric Katz said he “came away impressed” by the work that Time has put into growing its digital initiatives and said the company's live-events business “looks to be an area of opportunity going forward.”
“But at the end of the day, we think Time needs just a bit more runway for the new initiatives to take hold, as they're still two years away from becoming meaningful contributors” to earnings, he said.
Time's planned reorganization was first reported by the Wall Street Journal, which said that some layoffs were possible.
To contact the reporter on this story: Gerry Smith in New York at gsmith233@bloomberg.net. To contact the editors responsible for this story: Crayton Harrison at tharrison5@bloomberg.net, Paul Barbagallo, Rob Golum
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