The Times' David Carr has a great post this morning on his Media Decoders blog. It concerns the recently launched magazine, 48 HR, and the letter they have now received from the lawyers representing CBS. It is, you can imagine, a cautionary tale of "doing your homework" before launching a new product.
“To be honest, none of us even knew that there was still a program called ‘48 Hours,’ so it never crossed our mind,” Mathew Honan, one of the founders, is quoted by Carr as saying.
“When we were finished, we all felt like we had accomplished something significant, that there was a magazine there. It is the thingness of it, the physical evidence of the weekend that is so great. But the unfortunate truth I guess is that unlike what we said in the editor’s letter, you can’t do anything really large scale in contemporary society without have a legal team and a corporation.”
The magazine is available, at least for now, through print-on-demand company MagCloud.
I wish I could say that commercial publishers are any better at brand protection, due diligence and such. I have so many horror stories I could tell about begging owners to do due diligence before entering a new commercial venture, of protecting lists and brand names, and other valuable intellectual property. But it is sad to say that cutting corners is becoming the norm.
Part of the reason for this, apparently, is the desire to avoid legal costs (funny, isn't it, knowing that avoiding the legal costs up front will only increase them on the back end).
But the worst of the offenses may be in not creating budgets and forecasts before launching or acquiring a title. It almost unbelievable that someone could think about taking over a title before creating a budget. I guess budgeting has become positively old school.
One situation I was unfortunate to live through involved a company taking over a magazine and leaving the CFO out of the equation. When I talked to the finance person and asked if they had a budget for the new property I got the answer "what new property?" -- or some variation of that. The next question didn't really need to be answer then: "have you come up with a budget, or will that be my job?"
Things are not much better with new media ventures launched within print environments. It is pretty easy to bury the development costs of an electronic product within capital expenditures, then budget for new digital revenue, and conveniently lowball costs. After all, those editors of your are just adding digital to their regular duties, right? But it is worth creating an honest digital budget if only to be able to look at the real costs of new media ventures.
I have, in the past, created shadow budgets to answer for myself 'what would it look like if we went digital-only?' Often things didn't look that bad, assuming we could get revenue up . Print and distribution costs collapsed in this scenario, of course. But the big issue that would follow would involve inventory: do we actually have enough ad inventory on our sites to accommodate the amount of advertising we would need to break-even? The answer usually was no.
But you don't know for sure until you create that budget.