Ahead of Spinoff, Time Inc. Faces an Uphill Climb in Digital

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Time Inc's Sports Illustrated tablet app is demonstrated on Wednesday, Feb. 2, 2011. The company has named a new head of digital and launched a new ad platform ahead of its spinoff.

Image: Paul Sakuma/Associated Press

By Jason Abbruzzese2014-02-27 22:35:02 UTC

With its spinoff looming, Time Inc. is preparing for life as a publicly traded company with a new head of digital and a fresh digital ad platform.

For almost a year now, the publisher of titles like People and Sports Illustrated has been preparing to become its own company, separate from Time Warner. The new entity will become one of the larger standalone print media companies, with approximately 138 million consumers across various platforms.

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The official break between the two companies is expected to come later this year, but Time Inc. has not been waiting to begin its reformation.

Among the biggest moves has been Thursday’s announcement that M. Scott Havens, president of The Atlantic, will join Time Inc. to head its digital efforts.

Havens joins just a day after three digital executives left Time Inc., and just weeks after the company brought in a new chief technical officer from Amazon.

The reshaping of Time Inc. comes as the company limps into life as a separate entity. The company will have $1.3 billion in debt once it is spun off; the most recent Time Warner earnings report showed flat revenue, as advertising growth offset subscriber decline.

Time Inc. also reportedly laid off about 500 staff members in early February, the type of move that will be necessary to improve margins that will be heavily scrutinized as a public company.

For Time Inc. to succeed as an individual company, it will need to run leaner and quicker, maximizing revenue and minimizing overhead.

Havens told Mashable that among his biggest tasks will be ensuring that the new company will be agile enough to change quickly.

“I’m hoping I can bring a little bit of that experience and energy and entrepreneurialism into Time and amplify what they're already doing, which is amazing,” he said. “I think it's just about how do you play a big platform game and at the same time be nimble and innovative. That's the big challenge.”

“The platform is really important with the rise of programmatic,” he added.

Programmatic advertising is the next great hope of the advertising world. The term "programmatic" generally refers to the use of automated systems to pair advertisers and platforms; a more detailed assessment can be found here.

This type of digital advertising is expected to soar in the coming years, providing companies with an opportunity to corner a developing market.

The announcement of Havens joining Time Inc. comes just a day after the company launched “Global Exchange," a new ad platform built on Google's programmatic ad technology.

“The reason for allowing programmatic to grow is simply that the demand is outpacing anything we anticipated a year ago,” said Andy Blau, senior vice president and group general manager at Time Inc. “Now without going too far from their desk, [advertisers] can see and they can survey the landscape and pick impressions across a much wider breadth of the Internet.”

Blau added that the exchange will allow Time Inc. to attract more foreign advertisers, a group that has been eager but unable to easily access the company’s ad inventory.

Havens struck an optimistic tone, highlighting his success at The Atlantic and what he sees as a renaissance for traditional media titles both among consumers and advertisers.

“I really believe there is a pendulum that is starting to swing back. The pendulum swung very far over to the atomization of content, the Twitter-ization of content,” he said. “The volume is too much and when that happens, people return to their trusted brands.

“If i'm right... companies like Time will be the beneficiaries.”

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Topics: Advertising, Business, Media, Time Inc