In an interview with The Hollywood Reporter, IAC Interactive CEO Chairman Barry Diller admitted that while the concept of buying and reviving Newsweek was “lovely,” even a “village idiot” could have seen that it wouldn’t work:
The Newsweek mistake was mine, solely. By that I mean that the concept that was presented at the time was superficially lovely but did not have a single brain in its head beyond the superficiality. I didn’t scratch it enough, and the truth is that a village idiot, if they had scratched the surface of it, would have said, “This is very unlikely to happen,” because the original projections were that we would break even in the first year.
A very big mistake indeed, as Diller said. They lost $60 million on the venture, before selling it to IBT Media last year.
Newsweek has since relaunched, but it will take at least several more months to determine whether or not there is still an appetite for the magazine.
Diller was also asked about the future of The Daily Beast following the Newsweek–Daily Beast merger fiasco. He said that he hoped it will exist beyond this year, but it will have to be “deficit neutral:”
Reality is reality. It will have to carry its weight—meaning, it will have to be deficit-neutral at the least for it to continue. There is no exact point in time [to reach that], other than there’s no possibility that the timeline for determining that would be 10 years. But it’s not 10 months or 10 minutes.
Not exactly a strong vote of confidence, but I understand Diller’s hesitance to commit to The Daily Beast for the long term.
Prior to the Newsweek fiasco, reports had surfaced that The Daily Beast was operating at a break-even level or better, but was now firmly in the red, thanks to the turmoil resulting from the failed merger of the two news properties.
Combine the financial issues with the resignation of high profile editor Tina Brown in September, and what Diller is left with is a money-losing website struggling to regain its identity and relevance in an increasingly crowded field.
The Daily Beast may have a future, but it just may not be with Barry Diller.