BREAKING NEWS & VIEWS

Lou Mohn's Status Unclear in Playboy/AMI Partnership
Tuesday, November 24, 2009

Mohn has been Playboy VP/Publisher since Jan. 2006, but today's (Nov. 24) Wall Street Journal-reported outsourcing of Playboy's business side (advertising/circulation/marketing, etc.) to the David Pecker-led American Media Inc. leaves his status up in the air.  He told min this morning that "I can't say anything at this time."   Overall, the WSJ predicted that few of Playboy's circa-30 full-time business employees would be offered jobs at AMI.

Deal, per the WSJ, is for five years (sum not disclosed), and gives Pecker--who celebrated his 10th anniversary at the AMI helm in April--the opportunity to package Playboy with Men's Fitness, Flex, Muscle & Fitness, and Ultimate Fighting.  In other words, "a new piece of its quest to control an audience of young men captivated by fitness, fights, and women."  AMI also publishes the female-targeted Shape and Star, and the tabloids National Enquirer and Globe.

From a magazine perspective, the deal is somewhat similar to the 1993 arrangement between American Express and Time Inc., who share a management services agreement.  While Time Inc. works closely with American Express Publishing, editorial at Travel + Leisure, Food & Wine, and Departures, as with AMI at Playboy, is not affected

For Playboy Enterprises Inc. CEO Scott Flanders, the Freedom Communications alumnus who succeeded Christie Hefner in July, the AMI partnership continues his cost-cutting, as the magazine's 2010 frequency has been cut from monthly to 10 times yearly with a rate-base reduction from 2.6 million to 1.5 million.  AMI deal does not preclude a possible Playboy sale, and although AMI is not considered a player, never say never with Pecker--a CPA renowned for his financial smarts throughout his executive career at Hachette Filipacchi Media U.S. (1990-1999) and AMI.


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