Tuesday, November 24, 2009

AMI Picks up Business Outsourcing Deal with Playboy Magazine

The "bolder steps" are becoming clearer, and they appear to be good ones.

When Playboy Enterprises CEO Scott Flanders recently spoke about needing "bolder efforts" to save Playboy's print publication, there weren't any specifics. Today, news hits that Playboy has outsourced the business end of the magazine -- ad sales, marketing, subscriptions, distribution -- to American Media Inc., the giant Florida-based publisher, home to Star, Men's Fitness, and other publications. (They're even reporting it in Russia.) The five-year deal is intended to return the magazine to profitability by 2011, reports Chicago Tribune.

Thirty jobs at Playboy Enterprises could be lost in the shift, according to reports, but some of those people might land at AMI.

Briefly, this is a smart move. It leaves the heart of the magazine, the editorial, in-house and outsources the part that has been giving the company a headache for decades, at least since the Reagan administration teamed up with the Religious Right to scare away advertisers from the magazine. Since then, we keep hearing about circulation drops, but circulation can be fueled by a thicker magazine. Just think what kind of marketing and promotion the company could have done with the tens of millions of dollars in advertising money it lost as a result of the government-Religious-Right collusion? AMI's business muscle should come in handy in addressing that problem.

Still no word on an outright sale of the entire company or other strategic moves by Flanders.

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