Publishing magnate Felix Dennis has put an end to speculation about his long-term interests in the US by confirming plans to offload the bulk of his overseas operations. This includes the American edition of flagship title Maxim, whose growth has slowed in recent years amid an ongoing decline in the lads’ magazine market.
Just over a year after rumours of a likely sale emerged, Dennis Publishing announced last week it had appointed New York media investment firm Allen & Company to look at a possible sale of its US division. The move marks the end of a lucrative decade for Dennis in the US, driven largely by the success of Maxim, which was launched across the pond in 1997.
While the men’s magazine sector as a whole has begun to slide, Maxim, with reported sales of about $40m (£23m) and 2.5 million subscribers, remains a prominent player globally with 31 editions in 45 countries. Last year, analysts predicted the US edition could be sold for up to $400m (£229m).
Simon Kippin, publishing director of Condé Nast’s Glamour, says company founder Dennis has been "remarkably successful" in the US market where other British publishers, including EMAP, have "tried and failed".
But Tim Brooks, managing director of Guardian Newspapers Limited (GNL), believes the Dennis titles are past their peak. "Why would anyone want to buy anything that Felix is selling because it means the best years are behind it?"
The entrepreneur has built a reputation for anticipating trends and capitalising on them. But as a man known as much for his eccentricities and passion for poetry as he is for his business nous, it is difficult to predict what the maverick millionaire will do next.
Some industry observers suggest Dennis may be gearing up for a new round of acquisitions, but others wonder whether Dennis can continue to sustain his appetite for the UK business. The latest ABC figures show the men’s lifestyle magazine market in the UK suffered a 14.4 per cent year-on-year drop in circulation. Maxim experienced a 29 per cent year-on-year decline to 131,497. For now, the company has confirmed it will continue to publish Maxim under licence in the UK.
Beyond the turbulent men’s magazine market, Dennis has built a successful stable of lifestyle, computer and driving titles. Now the company appears to have its sights set on leading the way in digital and last year launched internet-only consumer magazine Monkey.
Paul Thomas, head of press at MindShare, suggests the launch of Monkey, which operates in a similar space to Maxim, may represent a change in strategy for Dennis, who previously held the view that you "could put a lot of money online and not get much out". Despite its initial success, Monkey has not been without its problems.
GNL’s Brooks describes the venture as "unremarkable" and largely undeserving of all the hype that has accompanied its launch. Moreover, last month Dennis had to reassure advertisers about the content of Monkey after MindShare temporarily pulled ads from clients including Unilever’s Lynx brand. Thomas says "visually it lends itself to the lads’ marketplace" but that advertisers are wary of the content.
Despite these challenges, Thomas argues in terms of technology the product is at least six months ahead of its rivals, presenting "huge potential" to expand the business to other publications that are "prohibitively expensive to produce" in printed format.
Dennis is understood to have plans to roll out another electronic magazine in the next three months and two more by the end of the year. The titles will extend the company’s focus beyond its predominantly male audience.
While Dennis’s US adventure may be coming to an end, few people in the UK underestimate the ability of this self-made millionaire to continue to push boundaries in the sector.