By Lucia Moses of Mediaweek

As layoffs roll out this week across Time Inc.’s three magazine groups, parent Time Warner CEO Jeff Bewkes said the company would promote more sharing of resources across its magazines in the hunt for efficiencies and “continue to take a hard look at underperforming titles.”

Those apparently include Fortune Small Business, which will fold. The title, which Time Inc. shifted to its custom publishing unit last year, saw ad pages decline 18 percent this year through November, per the Mediaweek Monitor.
 
Bewkes, on a November 4 conference call to discuss Time Warner’s third-quarter earnings, confirmed earlier reports that the company would cut $100 million in costs. That will translate into layoffs of 400 to 500 employees at, or about 5 percent of Time Inc.’s workforce, per news reports.
 
Much of the cost reduction would come from Time Inc.’s News business group, which includes Time, Sports Illustrated, Fortune and Money magazines, Bewkes said.
 
Layoffs have already begun to hit the News group and are expected to roll out to the other two magazine units, the Lifestyle group and Style and Entertainment group, this week.

Amid those changes, Steve Zales, president of the Lifestyle Digital Group, stepped down today.

The company offered a buyout to the company’s 300 or so union-represented employees. Time magazine is asking for 12 volunteers and People magazine, eight, by next week, according to the union.

Under the union contract, volunteers would get 13 weeks’ pay plus two weeks’ pay for each year served. There are extra payouts for longtime employees.

“What they’ve told us is, they are looking for a particular amount of financial savings,” said Bob Townsend, local representative for the Newspaper Guild of New York, which represents Time Inc. employees. “If they reach that amount there won’t be any layoffs.”
 
Time Inc. eliminated some 600 jobs, or about 6 percent of its workforce, at this time last year, when it also grouped its magazines into three units.
 
In the third quarter of 2009, Time Warner’s publishing revenue declined 18.2 percent to $914 million on a 22 percent decline in ad revenue.
 
Declines have been sharper at the company’s business titles; Fortune’s ad pages fell 33 percent this year through Oct. 26 while Money’s fell 30 percent through November, per the Mediaweek Monitor. Meanwhile, Time and Sports Illustrated were down 24 percent and 19 percent, respectively, through Nov. 2.
 
The company said it expected advertising results to improve in the fourth quarter, helped by improving trends in food, auto and beauty ad spending and easier comparisons with the year-ago quarter.
 
Meanwhile, advertising softness continued to impact Martha Stewart Living Omnimedia, which also reported its third-quarter results Nov. 4. Total company revenue declined 25 percent to $49.8 million due to continued advertising and merchandising revenue declines.
 
Publishing, MSLO’s biggest single revenue source, posted a 21.6 percent decline in revenue, to $27 million, on lower ad pages, subscription revenue and newsstand sales.