Magazine Publishing The magazine publishing division, which includes Newsweek, Inc., and Post Newsweek Tech Media Group, recorded operating income of $49.1 million, a decrease of 21 percent from operating income of $62.1 million in 1999. Revenue totaled $416.4 million for 2000, a 4 percent increase over 1999. The decline in operating income occurred primarily at Newsweek. Newsweek, Inc., recorded a decline in operating income, after a record performance in 1999, as a result of a significant drop in the pension credit, higher subscription acquisition costs, and an increase in investment spending on the recently acquired Arthur Frommer’s Budget Travel. But thanks to careful expense controls, several strong special issues, and improvements at Newsweek’s international editions, Newsweek’s results exceeded expectations. For the craziest, closest presidential election in modern memory, readers turned to Newsweek for out-front reporting and analysis that helped define the political landscape week in and week out. Newsweek’s coverage of international affairs was equally notable, with features on Jerusalem, the AIDS crisis in Africa, and a Pentagon cover-up concerning the 1999 war in Kosovo. Readers responded well to the magazine’s clear, lively coverage of health, science, and technology – including cover reports on Napster, diabetes, Alzheimer’s, and autism; two editions of “eLife” (Newsweek’s guide to the world of high tech); and the widely distributed special issue, “Your Child: From Birth to Three,” a follow-up to the magazine’s hugely successful 1997 edition for parents. Newsweek’s domestic advertising pages were down 7 percent in 2000 compared to 1999, but net rates per page were up, bringing 2000 ad revenue to roughly the same level as in the previous year. Along with the magazine industry as a whole, Newsweek experienced a soft fourth quarter advertising market. The magazine faced sharply reduced automotive advertising in 2000, in part because of the slowdown in domestic auto sales, as well as the downturn among the dot-coms and the technology category as a whole. However, some categories gained pages: financial services, pharmaceuticals, and telecommunications. Also performing well were the magazine’s various special issues, including “Your Child,” “eLife,” and two editions of “Issues 2001,” which were published both in the U.S. and overseas in cooperation with the World Economic Forum in Davos, Switzerland. Newsweek’s domestic paid circulation remained solid and profitable at more than 3.1 million. Newsweek continues to lead the news magazine category in terms of the highest percentage of long-term subscribers, the fewest subscriptions sold with premiums, and the lowest subscription sales required to meet its rate base of 3.1 million. The circulation rate base for the magazine’s three English-language editions overseas rose slightly, from 663,000 in 2000, to 666,000 in 2001. Globally, Newsweek delivers a total audience of 22.6 million. Syndicated research around the world shows the magazine leading the newsweekly field with the highest concentration of readers in key demographic categories that advertisers most want to reach. According to MRI Fall 2000, the U.S. edition of Newsweek is read by a greater number of affluent business professionals than Time or U.S. News, and eight out of ten Newsweek readers are linked to the Internet. Newsweek International’s business picture improved markedly in 2000, with the overseas editions ending the year well ahead of expectations. Sales of advertising from overseas markets into the domestic edition reached a record level, and advertising pages for the international edition were at their highest since 1996 thanks to a 25 percent gain in the Asian market. Advertising revenue grew by 8 percent despite intense pan-regional competition, which pressured advertising rates. A strong dollar had a positive effect on operating results. In June an Arabic edition of Newsweek, Newsweek Bil Logha Al-Arabia, was launched in cooperation with Dar Al-Watan of Kuwait. Newsweek remains the only news magazine with weekly foreign-language editions – in Japanese, Korean, Spanish, and now Arabic. Itogi, Russia’s first independent news magazine, is also published in cooperation with Newsweek. As part of The Washington Post Company’s and Newsweek’s strategic alliance with NBC News, MSNBC Cable, and MSNBC.com, Newsweek’s web site was relaunched last June as Newsweek. MSNBC.com. Arthur Frommer’s Budget Travel, a no-nonsense guide to affordable travel, increased its rate base from 350,000 in 2000, to 400,000 for 2001. Teen Newsweek, aimed at America’s middle schools and produced with Weekly Reader, increased its circulation from 115,000 in the 1999-2000 school year, to 180,000 for 2000-2001. Newsweek Productions produced a third season of the “HealthWeek” series on PBS, as well as a 50-episode “Health Point” series for The Health Network, a joint cable venture of News Corp. and WebMD. In addition, Newsweek Productions produced “e-Planet: A Cyberday” for CNBC as part of a sponsorship package with Microsoft and its technology partners that also featured a special section in Newsweek. The one-hour documentary, filmed in 16 cities on six continents in the same 24-hour period, reported on the worldwide impact of the Internet. Newsweek Productions also co-produced with National Geographic Television the two-hour documentary “Destination: Space,” which also was broadcast on CNBC as a special edition of the “National Geographic Explorer” series. Newsweek Productions has entered into a development agreement with Carlton Television, a major television production company in the United Kingdom, to develop nonfiction programming for both the U.S. and international markets. Post Newsweek Tech Media Group, formerly Post-Newsweek Business Information, was relaunched with the mission to provide “smart content, smart solutions, in print, in person, and online.” The operations of two business-to-government publications, Government Computer News and Washington Technology, were consolidated into a government publications group. Entering its 25th year, FOSE, the premier trade show for government technology, diversified its business into smaller niche shows such as the IRMCO conference. Two of the unit’s web sites, washingtontechnology.com and gcn.com, turned profitable. In the business-to-business field, Washington Techway was launched, covering the commercial technology community of the Washington, D.C., region, and the web site, Washtech.com, was relaunched in partnership with two other divisions of The Washington Post Company. Operating results improved significantly at Post Newsweek Tech Media Group with growth in revenue across all products and effective attention to expense control.