Wired’s Reach for Multimedia Ring Falls Short
Is Wired coming unglued?
Three weeks after the refiling of its documents for an initial public offering of stock, chaos continues to reign at the oh-so-trendy Wired Ventures, the San Francisco-based parent company of that hot journal for the cyberspace set, Wired magazine.
At the center of the maelstrom, as always, is Wired’s 47-year-old co-founder and keeper of the zeitgeist, Louis Rossetto. Rossetto’s “mission,” as stated in the stock prospectus, is “to build a new kind of global, diversified media company for the 21st century.”
In quest of that goal, Wired Ventures lost $34.45 million during the first six months of 1996, more than double the $14.51 million in revenue recorded by the magazine alone during the same period.
The magazine--known for its fluorescent colors, at least one diagonally laid-out story per issue, and other eye-catching but largely unreadable design gimmicks--would still qualify as a traditional publication.
But Rossetto’s efforts to expand beyond it have so far been a struggle. A television program loosely based on the magazine’s “Netizen” section, which espouses a cyber-libertarian political viewpoint, was turned down by MSNBC, the joint venture between Microsoft and NBC. By then the program was already in turmoil because Rossetto had fired almost everyone associated with it. Once scheduled to air in August, the program is unlikely to be seen before the end of the year. (MSNBC is reviewing a revamped version.)
Grant Perry, the veteran CNN producer who was the show’s executive producer, was axed when he tried to tone down Rossetto’s strident cyber-libertarian rap.
But Rossetto is very much married to his philosophy. Just ask Paulina Barsook, a writer who was up for a book contract from Hard Wired, the company’s new publishing arm. Barsook was offered a deal far more meager than expected when Wired executives became annoyed with her public criticism of cyber-libertarians, who she believes to be too politically apathetic. Barsook turned down Wired’s book deal and is shopping her idea elsewhere.
There’s more trouble with other Wired ventures: A German version of the magazine is on hold after Rossetto and his planned partner, the German mass-market periodical Der Spiegel, failed to agree on an editor. Der Spiegel has threatened to sue if Wired goes ahead with the project on its own. Wired’s domestic plans for a design magazine and a journal on the “new economy” have also been tabled for now.
HotWired, the firm’s online magazine, is Rossetto’s favorite child. But like most online ventures, it has been a money pit. Currently housed in a swank San Francisco office, HotWired has 161 employees. Compare that to the print magazine, which had a mere 90 despite being the most financially successful unit of Wired Ventures.
“It’s insane how quickly they grew,” says one magazine insider. “They’re in the new building with air conditioning,” grumbled another.
Indeed, HotWired has attracted scant advertising and there are rumors that layoffs are imminent. There are further rumors that it may be eventually be reduced to a news service--an Associated Press for cyberspace.
But Rossetto continues to be enamored of online ventures. Suck, an online magazine started by two art department employees from Wired that presents a daily dose of Generation X philosophy on the World Wide Web, now has five full-time employees, including managing editor Ana Marie Cox, a former editor at Knopf. Founders Joey Anuff and Carl Steadman sold Suck to Wired Ventures for “a vast undisclosed sum,” Anuff says.
Then there’s the Wired initial public offering, which was originally filed in May and shelved weeks later in the teeth of a small-stock downturn. It was recently revived with the aim of raising more than $60 million, which even by Internet stock standards seems a stretch.
“Louis is involved in everything all the time,” said a former Wired employee. “I wonder whether that sort of behavior will be tolerated once the company goes public. I wonder if he really knows what he’s getting into.”
