Condé Nast will survive the shift of media online because for the most part they produce something that can’t be replicated online.
This is from a story in the NY Times last weekend:
“Condé also consistently sells more ads than its competitors and at higher prices, though some of its magazines make little or no profit. Even so, spending money to make money, and focusing on premium products to attract readers and advertisers, has clearly worked for more than a decade, though its margins are thin compared with those of its competitors. Condé executives say it generates close to $5 billion in revenue, has operating margins of around 10 percent and profits of about half that. Analysts and bankers say that Advance as a whole, which carries no debt, is worth, conservatively, $15 billion.”
Read more (here).
15 Comments
Funny, the NYT article doesn’t mention the benefit of the 0% interest loans they get from their photogs as contributing to their success! I just want my $700 bucks please!
Yeah, there was a line in there about how much they pay their (expensive) vendors, and I thought to myself, “The reason the company is worth so much is their extremely shrewd business practices”.
“$350 a day, plus the forced signing of an all-rights photographer contract — that’s how we do it!” But I guess a credit line there is worth more than ten Modern Postcards. I guess it says, “I have arrived”.
I always hear about Conde Nasty and when they finally came calling my first thought was “Yeah, this aught to be interesting.”
Well, their contract had no rights grabs, their photographer fee was higher than most (more than $350 for sure) and they paid all expenses. A majority of magazines now days seem to offer up a flat fee and you need to decide if you want to take the job or not. Sure they may budge a little, but not a lot. I was able to bill CN for my own equipment, my own studio and in a time where digital fees are either not paid at all or in the $100 to $250 range, they paid $500.
My take home (for a small sized shoot) was much more than just about every other magazine I’ve shot for.
Maybe I just had a good experience… or I am THAT good… Uhhhhh, well we all know the answer to that one.
Jeff
Jeff is right.
My contract with Condé Nast is not punitive as to rights (after some months of exclusivity I can license my images with some restrictions) and the daily fee is higher than $ 350 (plus all expenses).
Maybe I was lucky. Sometimes you are the right pro at the right time.
In my experience, a lot of big companies hang on to payments as long as they can.
At best, they can make interest on the cash while it sits on account, and at worst, they can pay their most dangerous (in a legal sense) creditors first if cash is tight.
They know that it’s next to impossible for some schmuck like me to come after a multi-billion dollar company for a couple hundred bucks. And so, net 30 or 60 easily becomes “whenever we feel like it.”
But, to be fair, sometimes things are slow because in the larger companies, paperwork needs to move across three or four desks before it gets to the guy or gal who actually pays the bills.
As an interesting aside, I had a gentleman laugh at me yesterday when I asked for a kill-fee guarantee, and for that kill-fee to be paid upfront as a deposit on the remainder of the project.
I worked for the new Conde Naste FrenchGQ in November 2007, a 7 day location shoot with two assistants in London…I eventually got paid 7 months later in June and even then not the whole amount. It doesn’t have to be like this…another client of mine EMAP’s Arena Magazine pays me within 4 weeks everytime which means I will always try to be available when they have a shoot for me, I will work harder to make their shoots special and come to them with ideas. Its just a matter of mutual respect that is missing from the Conde Nast experience as a contributor
I work for one of the other mega-conglomerate consumer magazine publishing houses and it’s been tough having to explain our policies to freelancers. Even tougher when they contact me regarding their invoices and I literally have no idea who to contact (our company recently merged with another publishing house) to move things along. Internally, I get the “It’s not my job and I don’t know whose job it is” or “That person no longer works here” BS. So my apologies to all the freelancers of the world. You’re not alone in your frustrations.
@Terence,
Yeah, I know a lot of the time problems stem from the “no idea what to do/no authority to act” syndrome that infiltrates huge companies. Been there done that. And, at least for me, it really helps to have an editor/contact who is up front in saying, “Dude, I have no idea, but I’m working on it.”
I don’t get angry until the communication stops, the lies start, or I get the impression that the editor no longer cares about finding someone to get the check out the door.
Conversely, there are people/companies who just don’t care.
I also find that generally, the further you get away from the photo/art department, the less anyone cares about getting the freelancers paid.
After all, there are tons of photogs out there lined up to take up any spaces opened by complaining regulars. I’ve actually been told as much by a major news service.
That NY Times article was an entirely uninformative piece of fluff, with the weird coda of, “Si will be around and active for years.” I mean, yes, hopefully. But really? He’s 80.
Meanwhile Conde Nast is as cheap and as extravagant as ever. I salute those among us who manage to surf the middle-ground and make it worth the experience and the credit. I know their “rates” are about the same as they were when I shot for them in like … the 80s. Think ad pages have remained the same?
Regarding its future, I’m assuming Conde Nast will survive, even if/when magazines eventually disappear (which won’t be any time soon). Kinda like how the major auto manufacturers will eventually own the electric market. The fashion and celebrity universe is tiny, and on a certain level Conde Nast owns it.
@2: you are dead-on.
@1: you think the $350 they owe you really makes a big difference in their $15B valuation?
I think what PE is getting at here (or at least what I interpret from his pointing out how they are protected from the current market shift online) is that they are selling a PREMIUM product.
Photographers would do well to treat their own business the same way – as a PREMIUM product and stop selling themselves short. This has been a theme on this blog (ie: the post about firing your clients, etc.) and #2’s point about their shrewd business practices is exactly correct. Sure you can say no to signing the contract, and they’ll just find someone to replace you – unless you produce something they can’t get anywhere else.
They may be tough on magazine rates, but I shot a book cover for them years ago (easy 1 day shoot +travel) and I believe I billed $6,000 for the cover image (not terrible for a small run – 20,000 books-US EUROPE) + travel/hard costs etc were billed separately. I have heard many horror stories from photogs shooting condes pubs, but my experience was pleasant. Rodale is a good one to shoot for as well (at least the book publishing arm). As I have always said, magazines are fun, but if you are looking to make money, they are fairly unnecessary. If you are not a good money manager, they will put you in the red.
Re No. 10:
Dude, I was half kidding. I do want my $700 bucks though. Past 120 days.
They do offer a premium product, and in the coming shakeout I bet they will start printing their mags bigger and better and charging more for them.
Si’s old townhouse, a triple-wide on East 70th between Lex and Third, features plaster wall construction with the most gorgeous colors mixed into the plaster. I’d grown up with plaster walls in an old tenement, and this was the deluxe version of that, hundreds of times harder and smoother, created by craftsmen brought over from Italy. The colors are beautiful.
@13 – Just curious Andre – is this your real name?
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