'Vibe' Retrenches in Face of Recession

NEW YORK -- Vibe magazine is cutting its paid circulation 25%, reducing its
frequency to 10 issues a year from 12, and merging its print and digital
editorial operations, all in the magazine industry's latest response to the twin
attacks by recession and new media.

In addition to internal
restructuring, Vibe is avoiding layoffs by adopting a four-day workweek
accompanied by 10% to 15% pay cuts for its employees.
But Vibe is also
departing from the standard playbook by introducing a twice-a-year
newsstand-only celebrity tabloid. It plans to increase the subscription price
for its flagship. And it is avoiding layoffs by adopting a four-day workweek
accompanied by 10% to 15% pay cuts for its employees. The new day off, at least
to start, will be Friday, though some staffing will be organized to keep the
office open five days a week.

"Based on the financial climate and based
on what's going on, we needed to make a tough decision," said Steve Aaron, CEO
of Vibe Media Group. "We decided not to follow the old-school textbook of
restructuring and instead look for ways to keep the talent in place." Employees
were told of the changes in a meeting this afternoon.

The Wicks Group, a
private-equity firm, bought Vibe in 2006. It quickly laid off more than 25
employees. It shuttered Vibe Vixen, a 2-year-old spinoff focused on women, the
following year. (It now plans to publish Vibe Vixen and Vibe Prodigy, a
parenting title, as occasional specials.)

Once a sign of weakness
Cutting paid circulation -- in Vibe's case, to 600,000 from 800,000 -- was
once a sign of weakness in the eyes of advertisers and marketers, but the ad
pages that bloated circulations used to attract aren't flowing like they used
to. "If you're not getting as many ad pages anymore and you have less-profitable
circulation that you're trying to maintain, the equation doesn't make sense
anymore," said an executive at one big magazine advertiser. "Magazines would be
better off getting rid of their unprofitable circulation and managing to a level
where it's more profitable on a bottom-line basis. And advertisers would
understand the reduction if it's told to them in the right way."

Many
magazines are still expanding or maintaining their current circulation levels.
But many others have decided to chop some down, resulting in circulation cuts
for titles including Time, Playboy, Reader's Digest, TV Guide and others.
Newsweek said on Monday that it will cut circulation twice more in coming
months.

"I really am surprised that a lot of other magazines aren't
doing this now," the executive said.

Vibe's ad pages dropped 17.7% last
year, worse than the industry's overall decline of 11.7%, after falling 19.9% in
2007, when magazines as whole held the line, according to the Publishers
Information Bureau. Unique visitors to Vibe.com, however, increased 35% to
443,000 in December from 328,000 in December 2007, according to ComScore.