Advance Publications, the family-owned company that includes Condé Nast in its portfolio, is on a ravenous acquisition spree as it seeks to move away from the publishing industry, cushion itself from the volatility in the advertising market and take up a new place in the communications ecosystem.
In an interview with the Wall Street Journal, Steve Newhouse, co-president of Advance Publications and a member of the family that owns it, explained how the company had witnessed the challenges that disruption in the media industry has visited on its members.
“We’re looking to diversify into different areas not as exposed to the vagaries of the advertising market,” he said.
But this is diversification on a totally new level. Advance has already spent around $3bn on several ventures, among them a stake in rocket company that launches satellites into low-Earth orbit and the majority of an e-sports analytics company. Among its full acquisitions: plagiarism-detection software Turnitin – its largest – and a group of theatres in Europe.
Few companies outside of private equity can boast such a portfolio, especially considering Advance’s position as the owner of some of the world’s best-known and best-loved magazines, including The New Yorker, Vogue, and GQ.
The company’s name reflects its publishing heritage. It takes its name from the Staten Island Advance, the first newspaper in which the family took a controlling stake in 1922. The same head of the family, Sam Newhouse, who made that first purchase would go on to buy Condé Nast for a cool $5m in 1959 as an anniversary present for his wife, who loved Vogue.
Newhouse media interests also included a suite of local newspapers, as well as cable news. Until 2016, it owned Bright House Networks, which it replaced with a 13% stake in Charter Communications, with which Bright House merged. The firm also owns 31% of Disney.
These new ventures are, in part, funded by the $2bn raised from the Bright House deal, though it has also raised funds through stock repurchases of Discovery and Charter. It is aiming, the company’s chief strategy and development officer Janine Shelffo told the Journal, to spend as much as $10bn.
“We’re focused on what will be the most disruptive economic trends over the next 10 or 20 years,” she said.
Though the troubles of traditional media are well documented, the difficulty with such an audacious move outside of a firm’s core market is a lack of expertise in these new industries. But then again, it’s next to impossible to be an expert in disruption.
One key trend that the company is now moving into with modest investments is e-sports. It has bought a majority stake in Newzoo Group, which provides analytics and market information for the gaming industry. Its other acquisition in this space is Esports observer, a business-information news website looking at this space. It will now pool its e-sports and sports business titles, a sign of where the company sees these industries converging at the level of investment.
In an interview with the Wall Street Journal, Steve Newhouse, co-president of Advance Publications and a member of the family that owns it, explained how the company had witnessed the challenges that disruption in the media industry has visited on its members.
“We’re looking to diversify into different areas not as exposed to the vagaries of the advertising market,” he said.
But this is diversification on a totally new level. Advance has already spent around $3bn on several ventures, among them a stake in rocket company that launches satellites into low-Earth orbit and the majority of an e-sports analytics company. Among its full acquisitions: plagiarism-detection software Turnitin – its largest – and a group of theatres in Europe.
Few companies outside of private equity can boast such a portfolio, especially considering Advance’s position as the owner of some of the world’s best-known and best-loved magazines, including The New Yorker, Vogue, and GQ.
The company’s name reflects its publishing heritage. It takes its name from the Staten Island Advance, the first newspaper in which the family took a controlling stake in 1922. The same head of the family, Sam Newhouse, who made that first purchase would go on to buy Condé Nast for a cool $5m in 1959 as an anniversary present for his wife, who loved Vogue.
Newhouse media interests also included a suite of local newspapers, as well as cable news. Until 2016, it owned Bright House Networks, which it replaced with a 13% stake in Charter Communications, with which Bright House merged. The firm also owns 31% of Disney.
These new ventures are, in part, funded by the $2bn raised from the Bright House deal, though it has also raised funds through stock repurchases of Discovery and Charter. It is aiming, the company’s chief strategy and development officer Janine Shelffo told the Journal, to spend as much as $10bn.
“We’re focused on what will be the most disruptive economic trends over the next 10 or 20 years,” she said.
Though the troubles of traditional media are well documented, the difficulty with such an audacious move outside of a firm’s core market is a lack of expertise in these new industries. But then again, it’s next to impossible to be an expert in disruption.
One key trend that the company is now moving into with modest investments is e-sports. It has bought a majority stake in Newzoo Group, which provides analytics and market information for the gaming industry. Its other acquisition in this space is Esports observer, a business-information news website looking at this space. It will now pool its e-sports and sports business titles, a sign of where the company sees these industries converging at the level of investment.
Sourced from the Wall Street Journal, New York Times; additional content by WARC staff
