Condé Nast parent company Advance Publications Inc. is investing $10 billion beyond its media business, acquiring and owning large stakes in companies focused on entertainment, software and even space.
According to The Wall Street Journal, which first reported the news, the move is an effort to reduce the company’s reliance on advertising revenue and to push the diversification of Advance Publications.
“We’ve seen how disruption affects traditional media and the challenges that result,” Steve Newhouse, co-president of Advance Publications, told WSJ. “We’re looking to diversify into different areas not as exposed to the vagaries of the advertising market.”
Owned by the Newhouse family, Advance has already spent about $3 billion, on a group of theaters in Europe called Stage Entertainment, e-sports analytics firm Newzoo and Stealth Space Co., a rocket operator “specializing in low-Earth-orbit satellite launches,” according to WSJ.
Advance paid $1.7 billion for Turnitin, an education software company that helps colleges identify plagiarism in reports and essays.
Advance also owns large stakes in Discovery Inc., Charter Communications Inc. and Reddit.
Condé Nast lost $120 million in 2017 and put W, Brides and Golf Digest up for sale.
CEO Bob Sauerberg stepped down last month to be replaced by former Pandora CEO Roger Lynch, who was named global CEO as Condé Nast combines its international and domestic media businesses.
Last week, Advance's local media arm sold TheTimes-Picayune, New Orleans’ 182-year-old daily newspaper, to rival newspaper The Advocate. Days later, The Advocate laid off the entire Times-Picayune staff — all 161 staffers. (The Advocate says it plans to hire some of them back.)
Newhouse told WSJ the company has no plans to sell other newspapers.
Earlier this year, Steven Newhouse was given the title of co-president of Advance Publications, sharing the position with his 90-year-old father, Donald Newhouse, brother of the late magazine titan, Si Newhouse.
The move suggests Steven Newhouse is being groomed to take the company reins.