My 'Internet Life' - And Death - editor Barry Golson discusses demise of Yahoo! Internet Life magazine - Column

Byline: BARRY GOLSON

A little over six years ago, I accepted the most interesting challenge of my career: to launch (or, more properly, to relaunch) a consumer magazine about the Internet. Ziff Davis, then a powerhouse technology publisher, had just struck a licensing deal with Yahoo!, then a promising Web directory, to plant a new logo on its modest (100,000 circ) two-issue-old quarterly, ZD Internet Life. I was hired to turn it into a monthly magazine. On July 1, after a fabulous ride, and with a paid circulation of 1.1 million, I was told the magazine would be folded.

We had lots of readers but too few advertisers. Pretty much the story of the Internet itself - more popular than ever, only no one can figure out who's paying the bills. We weren't a new-economy book. Because we at YIL had stuck to our surfing, reporting on the Net's resources and culture rather than its addled business schemes, we thought we had a good chance. But our bills came due, too.

Lessons learned? I was executive editor of TV Guide from 1990 to 1995, so I had a perch at the two largest magazines covering two enormously influential mediums. And while TV Guide's not in the best of health these days, either, YIL's decline was a lot more precipitous. It's the Internet, Jake.

I honestly was puzzled when people first asked, "Why a magazine about the Internet?" How could there not be? Why a magazine about TV, or about music, or about movies? If we'll read - in print - about the relatively few channels, albums, and movie releases, how about the millions of sites and services on the Web, not to mention the changing ways we access it, the issues it raises, and the changes it creates in people's lives? It made enough sense that at least a dozen competitors sprang up. But we had a great logo, editorial independence from Yahoo.com, and a consistent vision - so we cheerfully fought them all off.

With covers ranging from our "Top of the Net" best-sellers to William Wegman's weimaraners ("On the Net, no one knows you're a dog"), the magazine struck a nerve with readers. We were Adweek's this and Ad Age's that and were redesigned by Robert Priest. Our aspirations went beyond reporting on best health or travel sites to something resembling the Rolling Stone or Esquire of the Net - thus, in our flush years, world-class fees for world-class writers on politics, privacy, and ethics. In the traditional bow to advertisers, we had fashion shoots tied to digital culture.

Service nevertheless remained the core mission, and our circulation shot up between 1996 and 2000. We became profitable in 1999 and then more profitable in 2000. While Maxim maxed, and Oprah O'd, YIL came in a bit under the radar, pulling circulation gains almost as great, certainly the fastest-growing magazine of its type, ever.

But what, exactly, was its type? Though the tech and dot-com advertisers flocked to us, we had trouble fitting traditional advertisers' preconceptions: "Are you a service guide? A lifestyle book? A tech book?" Yes, yes, and not really. It didn't matter that YIL's demos - household income, education - were higher than Vanity Fair's or GQ's. What mattered was, "What slot did we fit?" Readers didn't have that trouble. I'd been to lots of focus groups, including ones for Playboy and TV Guide, but the ones we commissioned for YIL showed as satisfied a bunch of readers as I'd ever seen; they got the book and played it back to us. But we were a difficult category for Madison Avenue, with no other titles in our niche. Or our swath.

None of this was critical while the Great Bubble floated benevolently above us. When the POP! came in April 2000, we didn't panic. Group publisher Jim Spanfeller had made some nice inroads into traditional advertisers, and, besides, we weren't about the business of the Internet, but about its people. So when The Industry Standard went under, we sympathized, but we didn't think it was about us. But the larger truth is, it was about us. We, or at least our company, Ziff Davis, were as much a part of the double-talking, EBITDA-happy, option-hoarding, Netspeak debacle that overtook the rest of the Internet sector.

By the time YIL got traction, ZD had been bought and flipped twice, once by a buyout-leverage outfit, then by Softbank, whose CEO, Masayoshi Son, announced that ZD's magazines were part of his 300-year-plan and that he "loved" us all. That was soon followed by the dismemberment of the company and a dispersal of its publishing, Internet, TV, and conference units in different directions to different owners (including the sale of the magazines' own Internet sites to a separate company). The visionaries had already left, cashing in their options, and this was now followed by an exodus of the corporate execs who had concurred in the dismemberment, cashing in even more options - some worth tens of millions of dollars. (Disclosure: I've been a party to a lawsuit disputing Softbank's handling of its employee stock options.)

Our publishing unit was purchased by yet another buyout-leverage firm, Willis Stein & Partners, which installed a new CEO, Jim Dunning, promising us remaining publishers and editors sincere support and, of course, untold riches if we just hung in there. Then NASDAQ and the tech market began to tank. As the magazines' budgets began to be cut back, a straight-from-central-casting Internet "consulting firm" was hired to help create, at a reported budget of $50 million, an Internet "presence" - after the Internet bubble burst - that no editor agreed with or understood. (Twentysomething consultant to editor: "And what should a surfer feel when your new site is operationalized?") That was followed by the firing of Jim Spanfeller, architect of our magazine's growth. When the invoices for all those white-board presentations began to come due, Dunning closed a couple of titles and shopped around a couple of others. As he was about to sell YIL and the game titles to David Pecker, of American Media (see sidebar), Dunning was himself fired amid acrimonious personal charges and countercharges.

The last management, under Bob Callahan, did its best to keep us alive. But it was clear that the tilt of the steadily shrinking company was toward trade titles, not consumer magazines - Family PC, eShopper, Expedia Travels, and Smart Business were all shut down in the past year. Arguably, there were good bottom-line reasons for each closure, but it became an open question whether any magazines showing losses would - or could - be floated through the rough seas ahead. For certain, ZD had no one at the helm like Conde Nast's Si Newhouse, who commits for the long run and can hold his breath underwater for satisfyingly long stretches of time.

So after the turmoil of the past years, the other magazine closings, and the drumroll of press reports about the company's potential bankruptcy, our hard-charging new publisher, Diane Silberstein, found it - how shall I put it - a formidable task in our last six months to convince the likes of Chevy and Ralph Lauren that this orphaned consumer title, unlike its recently departed ZD siblings, was the place to put their money in the middle of the biggest ad recession in 50 years.

While all this was going on, YIL's editors and writers did what editors and writers do - they kept their heads down and put out the best magazine they could. As the cuts kept coming, we rearranged the chairs on the ZD deck and steamed on. We weren't oblivious to what was going on; editors whine about pay and rationed paper clips with the best of them. But when it comes to what we actually spend time on, unlike the business guys, we almost always would rather chase a story than a buck. It's our downfall, really, this love of narrative. Tell one of us that a departed CEO just got a $2 million handshake, and you hear, "Sucks. But what did you really think of that lead I rewrote?" The day before we closed, the most spirited debate on the floor was over our plans for a fall music and copyrights package.

Shortly before closing time, there were a few hopeful signs for YIL, but losses were projected to be in the millions, the company was strapped, advertisers scarce. There were apparently no buyers in sight for the magazine - who was buying any magazines these days? In addition, the name of Yahoo! had become a mixed blessing; it was now less a neutral Net directory than a media company with its own agenda and alliances, though to its credit it never tried to influence us editorially. But it was having an identity crisis (at YIL, many of us Googled more than we Yahoo!'d), and any potential buyer had to consider the weight of that baggage as well.

Would YIL, with its 1 million subscribers, have survived in different hands? I don't know. We were losing money. The advertisers were sitting on their hands. The tech economy was turning worse. So if I'm honest, I'd have to say, if faced with the same financial imperatives our owners were, I might have closed it myself. But would a company less dizzy from being flipped, less ravaged by its own financial maneuverings, less leveraged by other people's money have been less likely to pull the trigger?

What about my own responsibility? In retrospect, what other moves might an editor or a publisher have made? As it was, the pressures to accommodate advertisers were, especially under the previous regime, often intense. And in the future, how will our owners decide on allocating funds for the online side of publishing? Good questions, and I don't think Google can help. It's unlikely, in my view, that the present model of posting free magazine content, both original and repurposed, will continue to make sense. I believe you have to serve your reader. Your paying reader.

In the end, CEO Bob Callahan was a straight shooter, even if what he shot was...us. We were treated humanely in the shutdown. It was, in fact, a grand ride, even if our amusement park operators entered their own crazy house of mirrors. I suppose, given all that had come before, that the end was inevitable. But a couple of days after the closing, I stopped at a Barnes & Noble on my way upstate. I asked, as I always do, how Yahoo! Internet Life was moving on this, its final, month. "Had to restock it three times," the guy said.

WAS YIL'S DEATH NECESSARY? OTHER VIEWS

JOSH QUITTNER EDITOR OF BUSINESS 2.0

"The only thing that could have succeeded was a pure service play: What are the best search engines? How do I fix my computer? - the things that older folks look to the security of a magazine for."

ALAN MAY EXECUTIVE VP, MEDIACOM

"I don't think there's a need now. I don't think their concept was flawed initially, but the Internet has become just such a normal part of everyday working life, and it became a must-have editorial piece for every publication. As the economy contracted, there was just not enough dollars to go around for anything specific to the Net."

SCOTT CRYSTAL FORMER EXECUTIVE VICE PRESIDENT CONSUMER MAGAZINES, ZIFF DAVIS MEDIA

"Ideally, it needed to be aligned with complementary titles at a major consumer publisher - such as Hearst, Conde Nast, or AOL Time Warner - so that it could be properly packaged and leveraged to the ad community. The fact that there was little or no interest from these companies indicated that perhaps the magazine had outlived its purpose and unique position as an Internet lifestyle magazine for a mass audience. A possible scenario for survival may have been to return to a more niche-oriented appeal and reduce the circulation to the more sustainable (and profitable) levels of magazines such as Wired [500,000+] and Business 2.0 [550,000]."

STEVE FOX FORMER EDITORIAL DIRECTOR OF CNET

"The novelty is certainly gone....There are no magazines about the 'television lifestyle.' And the problem with an Internet book that tries to be a guide is that the tools are more sophisticated [than TV tools]. I think the category itself has lost steam."

DAVID PECKER CEO OF AMERICAN MEDIA, ONE-TIME SUITOR OF YIL

"Jim Dunning asked me if I would be interested in Yahoo! I thought they had a brand and a built-in circ file, but it was doing pretty poorly on the newsstand....I was going to do some editorial research and some focus groups and see how the editorial needed to be changed....It was looking too much like it wanted to compete with Vanity Fair."

JIM SPANFELLER FORMER PRESIDENT OF CONSUMER MAGAZINES, ZIFF DAVIS MEDIA

"It was a dream audience. They did everything: They spent money; they made money; they were not 28, but they were not 50, either. When I left in 2000, it was very profitable....I think the corporate focus moved in a different direction."

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