No Big Changes Planned : Rolling Stone Publisher to Acquire US Magazine

The company that publishes Rolling Stone magazine said Tuesday that it has agreed to buy the 75% of US magazine that it does not already own. Straight Arrow Publishers did not disclose the price it will pay Warner Communications Inc. for the stake.

Jann S. Wenner, chairman of Straight Arrow and publisher of Rolling Stone, said no major changes in format are planned for US, a biweekly that devotes much of its pages to celebrity and entertainment features. However, the company plans to merge some back-office business operations of the two magazines and boost advertising by offering space in both publications as part of one package.

New York-based Straight Arrow originally purchased its 25% interest in US in 1985 along with other partners that were subsequently acquired by Warner Communications.

Although a sale price was not disclosed, industry officials estimated that Warner’s stake in the money-losing publication was probably worth about $10 million to $15 million.

Wenner said acquisition talks began before Warner announced its planned merger with Time Inc., publisher of People magazine, which many consider the major rival of US.

In 1988, US had estimated revenue of $52 million and circulation of about 1.4 million, according to MagazineWeek, an industry trade publication. In contrast, People posted revenue of about $540 million and a circulation of 3.4 million.

“It’s a real David and Goliath type of competition,” said Don Nicholas, editor of MagazineWeek.

Under Straight Arrow’s direction, US has taken steps to set itself apart from People, Wenner said. “We made it something different from People magazine. US covers are about the hot young stars and entertainment. It’s an all-entertainment package.”

Wenner said he expects US to break even by next year, but magazine industry officials were less optimistic.

“They would have to sell twice as many ads as they do now,” Nicholas said. “It’s going to be tough.”