It’s Still Miller’s Time

Among the losing bidders for Petersen Publishing last year was Robert L. Miller, an expansion-minded executive who helped create such magazines as Vibe and Martha Stewart Living during a 23-year career at Time Inc.

You won’t find Miller licking his wounds, though. With backing from a prominent investment firm, Miller last month scooped up six sports magazines--more than doubling the size of his Los Angeles-based media company.

The acquisition of Tennis, Snow Country and four other magazines from New York Times Co. has only whetted Miller’s ambition. Already, the 48-year-old publisher is talking about using them as a springboard for expansion into other business lines.

Don’t count him out.

As a top executive at Time, Miller played an important role in developing Sports Illustrated’s celebrated swimsuit edition, an annual hit at newsstands despite rounds of feminist protests. He also helped turn Martha Stewart Living into a $200-million-a-year industry.

This summer, his Miller Publishing Group launched a television show based on Vibe.

Miller refers to his magazines as “brands” and “franchises”--a clue to his multimedia aspirations.

“It’s been curious to me that Los Angeles hasn’t been a more conducive atmosphere for magazines,” Miller said in an interview in his West Los Angeles office. “The energy here is so staggeringly creative. I’d like to harness that into the kind of brand-building that has to take place at a magazine group.”

Miller has his work cut out for him. Tennis and Snow Country, two magazines acquired from the New York Times, have posted significant losses in advertising pages and circulation this year.

Miller maintains that “properly developed and nurtured, there’s a lot of growth opportunities in these titles.”

His biggest branding effort, the Vibe television show, has so far been a dud. The syndicated weeknight show--which airs locally on UPN--hasn’t done well since its August debut, Miller conceded. With the recent replacement of the show’s little-known original host with the popular comedian Sinbad, ratings have seen a small uptick.

Nonetheless, Miller has the support of Freeman Spogli & Co., which bankrolled the deal with the New York Times and plans to pour more than $100 million into the budding media company.

Located in the same high-rise as Miller Publishing, Freeman Spogli--a leveraged buyout specialist--views Miller as a sort of leveraged buildup.

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“We try to buy into a good company and make it better by spending more,” said Freeman Spogli partner Fred Simmons.

Simmons said the firm sees Miller as a medium-term investment. It is likely that at the end of four to six years Freeman Spogli will cash out either by selling the company or taking it public. The firm recently took the latter route with Brylane Inc., a mail-order catalog group.

Those plans would put Miller Publishing on the same track as Petersen. The publisher of such niche titles as Hot Rod and Motor Trend, Los Angeles-based Petersen was sold last year for $463 million. Last month, it went public as Petersen Cos. in an initial offering that raised $150 million.

Miller was a fast-tracker at Time. He is credited with turning the Sports Illustrated swimsuit issue into a huge profit center for the company.

According to the recently published history of SI, “The Franchise,” Time turned down Miller’s suggestion that it buy ESPN in the mid-’80s; author Michael MacCambridge calls that a “billion-dollar mistake” on Time’s part.

Miller’s greatest achievement at Time was spinning Martha Stewart Living into a brand. Miller oversaw the magazine from its development to its extension into a media empire that includes television, books and merchandise.

In 1991, Miller moved to Los Angeles to head up the newly formed Time Inc. Ventures, where he launched Vibe in partnership with celebrity music producer Quincy Jones. He wanted to be close to the entertainment community and Warner Bros., part of the Time Warner empire.

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The West Coast location was also attractive for another reason, said Miller: “The culture at the Time and Life building was not conducive to the creation of a special-interest business.

“It was important to create an entrepreneurial atmosphere, to create some distance from the entrenched publishing world in New York.”

But four years later, newly appointed Time Inc. Chief Executive Don Logan decided to create a flatter management structure and brought the Ventures operation back to New York.

Miller said at that point, in late 1995, “we [he and Logan] decided it was time for me to leave.”

Miller, Jones and Jones’ business partner, David Saltzman, bought out Time’s stake in Vibe, launching Miller Publishing.

Earlier this year, the company paid a reported $42 million to acquire the alternative music magazine Spin from Bob Guccione Jr.

Observers say it may be impossible for Miller to ever replicate the success of Martha Stewart Living--a publication built around a savvy personality whose homey tips clicked with aging baby boomers.

“The Martha Stewart phenomenon is just that. It’s one of the all-time success stories. It’s tough to match,” said New York magazine consultant Dan Capell.

Still, Capell thinks there is potential in well-managed niche titles, as evidenced by publishing groups from Petersen to Ziff-Davis, which turns out the highly successful PC magazine.

As for next steps, Miller is tinkering with Vibe to attract an older audience. A hefty percentage of readership is in the early to mid-teen category, too young to legally consume the cigarettes and alcohol that are prominently advertised in it.

Unless Vibe raises the age of its readers, it could stand to lose tobacco revenue under government proposals to restrict such advertising.

Regarding Spin, Miller said he has no intention of dramatically overhauling the title, aimed at 18- to 29-year-olds. “We will continue to represent a voice to the younger market. They have very different tastes than the boomer market that still embraces Rolling Stone,” he said.

Miller wasn’t specific about his plans for the sports publications. But don’t be surprised if you soon see multimedia exploitation of his latest acquisitions. Tennis, anyone?

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A New Spin

Spin and Vibe are Miller Publishing’s highest-profile magazines, but the company sees its future in niche titles such as Tennis, which edges out the music magazines in circulation and ad revenue. A look at the company’s magazines, ranked by paid circulation:

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Circulation* Ad Revenue** Chg. Ad Pages** Chg. Tennis 781,093 $5.8 million (-7%) 117 (-7%) Vibe 517,651 5.4 million (+36) 168 (+14) Spin 513,508 3.7 million (+16) 117 (+2) Snow Country 343,817 3.6 million (-12) 128 (-8) Cruising World 147,213 1.1 million (+9) 105 (+0.1) Sailing World 62,678 NA NA

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* Total average paid circulation for six months ended June 30

** Year to date through September, with change from previous year

NA: Not available

Sources: Audit Bureau of Circulations, Magazine Publishers of America