It’s a new era for Hollywood, where egos dominate not only the film industry but also the news organizations that cover it.
Traditionally dependent on the industry for advertising, Hollywood’s trade press is changing in accord with radical shifts in filmmaking and distribution. The latest move will be a drastic one: Variety and The Hollywood Reporter, longtime rivals, will soon share an owner.
Penske Media Corporation (PMC), publisher of Variety, is combining forces with MRC titles, including longtime rival The Hollywood Reporter, the companies announced Wednesday.
Missing from the slew of quasi-press releases printed under each brand is the word “acquisition,” even though the MRC titles are joining the PMC brand.
The proposed joint venture could shake up how money is spent and distributed with the trades’ print and digital properties, notable in a year when For Your Consideration budgets have become among the most stable ad categories during an unprecedented international pandemic.
The venture creates a mass portfolio of brands under a new entity the companies are calling PMRC that will put PMC titles (Variety, Rolling Stone and Music Business Worldwide) under the same umbrella as MRC titles (The Hollywood Reporter, Billboard and Vibe).
The deal smells like defeat to industry insiders—who spoke on the condition of anonymity in exchange for their candor—interpreting the venture as a worst case scenario that came to be after a search for a new owner for The Hollywood Reporter was made more challenging by the ongoing Covid-19 pandemic.
Variety, sources said, has long been held as a publication that, in the early 2010s, went through an extensive redesign to more closely chase the audience (and look) of The Hollywood Reporter. Now, they’re in the same family.
“To sell to the copycat version of your once-great publication, the No. 2 brand, that’s not a great look,” one source said. “I don’t think there’s any way to slice it, that you can spin that as a win.”
As part of the agreement, PMRC will also agree to a content strategy that leverages intellectual property produced by MRC’s TV and film studios.
The companies don’t plan to combine staff, keeping editorial and sales functioning independently and continuing to have distinct operating brands. However, they will share infrastructure including tech, finance and HR. The print frequency will remain the same for now, but will be reassessed.
THR prints 41 times per year and has a print subscriber base of about 54,000. Meanwhile, Variety has attracted nearly 52,000 subscribers, according to the most recent report by the Alliance for Audited Media.
Teams at those brands are expected to remain in place; however, The Wrap reported that Deanna Brown, president of Billboard and The Hollywood Reporter, was out of her role. A PMRC spokesperson didn’t immediately respond to a request for comment.
What’s in it for advertisers?
With this new portfolio, PMRC could use its titles’ brand recognition to reach the niche audiences they’re known for. “The town has really thrived alongside and symbiotically with the competition among the trades that has sort of mirrored the competition among studios,” another source said.
Without that friction, the deal could open up the portfolio to give advertisers package deals that span the websites and publications. But, once combined, it’s not likely those advertisers continue spending as they had previously.
“The ad buyers of the studios under stress and duress are probably not going to continue giving everybody money,” a source said, later adding, “Packaging and deals give you the benefit of scale, but not 1+1=3.”