The New York Times
Wednesday, October 10, 2012
In a Fire Sale, Penske Media Buys Variety
By BROOKS BARNES
LOS ANGELES - Variety, the 107-year-old giant of entertainment news, has been seized by blogger insurgents.
The Penske Media Corporation, a collection of entertainment blogs owned by a son of the auto racing mogul Roger Penske, on Tuesday announced the completion of a $25 million deal to buy Variety from Reed Elsevier, which has owned the trade newspaper since 1987.
Financing for the deal was provided by Third Point, a hedge fund founded by Daniel S. Loeb, the activist investor who upset Yahoo's management ranks earlier this year. Other bidders included the billionaire Ron Burkle and Avenue Capital, which controls The National Enquirer.
Penske Media's purchase underscores how the Web has transformed entertainment news, particularly when it comes to the trade minutiae that have long been Variety's bread and butter: casting decisions, TV ratings, box-office analysis, agent firings. Deadline.com, the centerpiece of Penske Media's portfolio, has largely taken over that niche since it was founded six years ago.
Variety.com, which operates behind a pay wall known for irritating log-in errors, has about 320,000 monthly unique visitors, according to comScore; Deadline, which is free, has about 2.4 million.
Hollywood saw the purchase as a takeover not by Penske Media but by Deadline, which is primarily written by three reporters who work from home; Variety has a staff of 120 and its name in lights on top of an 31-story office tower here. Penske Media owns eight blogs, including the celebrity-focused Hollywood Life and Hollybaby, both managed by Bonnie Fuller, the former editor of US Weekly.
For more, visit www.nytimes.com.
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