meets its maker
Early New Economy title chewed up by ad slump
By Jeff Bercovici
Upside was the first of the so-called New Economy magazines, but it won't be the last one left.
The 13-year-old business-and-technology publication is joining The Industry Standard, Ziff Davis Smart Business and eCompany Now in the dust bin of history. Its October issue, in production as of yesterday morning, has been canceled.
In related news, Red Herring, one of the few remaining New Economy titles, announced a financial restructuring yesterday aimed mainly at rescuing it from leases signed in better days.
Upside had a controlled circulation of 250,000, most of them technology business executives. It didn't report advertising sales data, but it had clearly been in serious financial trouble for some time.
Early last year, Upside Media entertained talks with technology trade publisher CMP, which was interested in acquiring it.
The talks didn't pan out, and Upside Media was forced to declare bankruptcy. Arlington, Va.-based MCG Capital Corporation, which had lent it $8 million, then foreclosed on Upside's assets.
In the early months of this year, Upside named both a new president/CEO, John Carroll, and a new editor, Lester Craft, previously of Line56 magazine.
Carroll, a trade-publishing veteran who replaced longtime CEO David Bunell, raised eyebrows shortly after taking over when he suggested that the magazine would soften its coverage so as to avoid offending advertisers or potential advertisers.
"I try to make sure we don't get in hot water with our advertisers," Carroll told the San Francisco Chronicle in April. "What's the sense of damning something for no reason?…This is not a good time, in publishing or any other business, to put yourself at high risk."
Meanwhile, the company had been demonized by more than 40 creditors who claimed that Upside went into bankruptcy owing some $600,000. They were unable to get restitution from MCG Capital, which took possession of Upside Media's assets but did not assume its liabilities.
Other victims of the downturn in technology advertising that killed Upside have included Yahoo Internet Life, On Magazine, Fuse, Inside, Family Internet Life and Internet Week.
Most recently, Forbes last week shut down its quarterly technology supplement, Forbes ASAP.
Red Herring Communications announced a restructuring yesterday in which it sold itself to RHC Media Inc., both of which are majority owned by Broadview Capital Partners. The move allows the company to get out from under leases for thousands of feet of office space it no longer needs now that its staff, which once numbered more than 400 people, is down to fewer than 50, approximately the same size it was in 1996.
Year-to-date through August, Red Herring's ad pages fell 72.1 percent to 262.7, according to the Publishers Information Bureau.
October 8, 2002 © 2002 Media Life
-Jeff Bercovici is a staff writer for Media Life.