Evening star. [volume] (Washington, D.C.) 1854-1972, 1957-01-14

least two more shaky magazines
and maybe as many as FIVE"
will be suspended.
This will follow the deaths last
year of the American Magazine.
Golfers. Woman's Home Com
panion and Town Journal.
Before the situation in the
magazine industry gets better,
It'll get worse" A wave of in
ternal house cleaning" is on the
way. Magazines in the red will
"be put on a profitable basis or
folded"
The deaths OF Golfers and
the Companion will have a far
reaching impact on the entire
industry, for the largest mass
Soul-searching operation" in
magazine history is now going
on.
These are few of the state
ments of Bernard Gallagher in
his privately circulated newslet-
ter, "Gallagher's Report" and in
a private talk with me. Mr.. Gal
lagher is one of the nations
leading magazine brokers.
Large Calculations
When Golfers died, its cir
culation was close to 40 mil
lion: when the Companion was
folded, its circulation was close
to 4.3 million.
Why did the magazines die in
view of this?
Mr.. Gallagher's answers are
frank:
First. mo company manage
ment was ever more blind" For
20 years, profits were hoggishly
drained out of the firm" Stock
holders were paid "outlandish
dividends while an incredibly
small amount of money was
plowed back for growth and ex-
pansion.
From 1888 through 1858. Mr..
Gallagher figures Crowell-Col-
Ilier made $81 million. OF this.
IS40.5 million went for taxes;
1897 million was paid out in di-
Ividends; another 81 million was
used to retire a stock issue. Mr.
Gallagher doubts that even the
remaining 100000 was put back
in the business. But even if it
was, this would work out to only
about a picayune $4,000 a year
set aside by a huge corporation
for the future
Second. virtually nothing was
done by the company to invigor-
ate the magazines during the
vitality important late '40s and
early sos when the new era of
lTV competition was developing.
Top men were old. getting old
err. Executives were talk
ing to themselves. The mag
azines lost contact with adver-
tisers and readers :. -"
Third. the Companions man
agement didn't respond to the
obvious fact that TV was re-
.ducing the need for Women's
service magazines. The manage
ments of both magazines didn't
diversity or plan ahead. The
growing tendency of major adj
vertisers to concentrate adver-
Using in two or three top mag
azines was a death blow. The
magazines began doing too lit
tie to catch up and compete.
much too late.
View of Future
What happens now? AS Mr..
Gallagher sees the future:
The specialized magazine will
flourish while the general type
magazine will wither. THE mass
circulation magazine" says Mr.
Gallagher bluntly, sis on the way
down.
Magazine publishers who sue
coed will put more money into
selling, research, editorial, etc.
even though they have to cut
their dividends.
4 Unions will make much great
or inroads amonp editorial stats.
To get out of the cost squeeze,
publisher will raise their rates
to advertisers without guaran-
teeng that circulate n will g. up
too And. Advertisers and ad l.
vertising agene,e s won quar-
rel with this action"
The publisher will lbe able N
agree power ully against The
planned postal rate incl case be-
cause they'll, have the Golfers
Compa Mon f1asco rs proof u
their plight TIL be a persuasive
Argument
j Aftel this period Of grimnesS