Can a Little Magazine Break Even?W M . F . B U C K L E Y J R .

A report to our readers from the editor, attempting to answer

some of the questions most frequently heard from them. And a

look at inflation and its special effect on the "little magazines."

Inflation's contributions to culturalconformity are not widely dealt with,and certainly not widely understood.I confine myself here to the dilemmaof the so-called "little magazine"—that is, the journal tailored to thetastes of the thinking few, rather thanto a more general readership. Such ajournal must depend, for its survival,on what the readers themselves willpay to gratify their interest—becausethe advertisers will not come in, inheavy enough numbers, to pick upthe bill. We all know that inflationand high taxation have the effect ofdiscouraging the cultivation of costlyintellectual pursuits. But what exact-ly is the l'ole of the advertiser?

"It is absolutely ridiculous," a pub-lisher friend once told me, "for theNew York Times to sell for only fivecents. It ought to sell for a quarter!"Now my friend is not out to punishthe readers of the Times, or at leastnot in this way. He sDeaks as a pub-lisher, and he means that the extraor-dinary ofFer the New) Yorfc Times(he is using it merely as a symbol—he might as well have mentioned theDallas News or the Chicago Tribune01- the San Francisco Chronicle) isable to make every day for a merefive cents, thanks to its advertisers,has the effect of conditioning thereader to living in a dream world,where reading matter is plucked offthe trees, virtually free of charge. Itis very hard, let's face it, while theTimes costs five cents a copy and Lifetwenty-five, for National Review tocharge thirty cents (divide $8.00 by 26issues), let alone sixty cents—whichis what we should be charging, giventhe costs of publishing, and what weKJOuM be charging if the averageAmerican reader were prepared tonay as much more, relatively, forperiodical reading matter over theprice in 1933, as he is prepared to pay.

today, for a hamburger, or a movie,or an automobile, or a pencU.

That is the dilemma I speak of.When the cost of manufacturing goesup 10 per cent the mass periodicalpublisher seldom has to turn to hisreaders to demand a 10 per cent in-crease in the subscription rate. Heturns, instead, to advertisers for anadditional subsidy; and the adver-tisers absorb the increase as a cost ofdoing business, which is reflected,naturally, in the price of their prod-ucts to the consumers. But the littlemagazine has no such buffer. Noi-malbusiness enterprises turn immediately,as they must, to the consumers, toabsorb an increase in the cost of pro-duction. But the consumers of peri-odical literature are accustomed tobeing heavily subsidized, and hencepartially relieved, in a way in whichthe radio listener or television vieweris fully relieved, of personal obligationfor the cost of production. The readerof National Review or the New Lead-er or the Nation is, with his left hand,buying Life, and the Saturday Eve-ning Post, and the New York Times;or if not, he is in any case aware,consciously or semi-consciou.sly, oftheir prices at the newsstand, and itis from them that he derives thestandards of value by reference towhich he passes judgment on the ask-ing price of a "competitive" Di'odu'it.Although that reader has been realis-tic enough to permit a relative in -crease in the price of the "little"journal (the New Revuhlic chargesmore than Life), the point of dimin-ishing returns is soon reached, wherethe journal cannot afford to chargethe rpaders more.

And that point is reached far thisside of solvency. The result is anoperating deficit. The cultural conse-quences would seem clear: most ad-vertisers (I except the farsighted

few) will support widely only maga-zines with a mass circulation. Thepublisher is at their mercy—in thesense that the advertisers are prin-cipally responsible for the psychologyof periodical pricing: they set thelimits beyond which subscriptionprices may not safely be set; and yetthey will not extensively patronizejournals written for the few; in Na-tional Review's case, not even thosefew who are doing the thinking neces-sary to preserve a climate of opinionwithin which business enterprise cansurvive.

That is what my friend was talk-ing about. If the New York Times—and Time, and Life, and the Satur-day Evening Post—were to let theirprices keep pace with inflation, theywould be charging two and threetimes what they do now, creating aprice climate in which National Re-view—and the New Republic, theNation, the New Leader, and theCommonweal, all of which are losingmoney—could increase substantiallytheir subscription rates, thus makingends meet. In 1923, Albert Jay Nock'sweekly Freeman sold at $6.00 peryear. Nationol Review, founded 32years later, sells for $8.00 per year.In 1923 linotypists were paid $25 perweek. Today they are paid $125. ThatIS the measure of the problem I speakof.

Inside National Review

Consider the cost of publishin-' Na-tional Rcrip'">—a cost which, as far aswe can see, is irreducible so lont* asthe magazine is to have its nvesentaDoearance. I take the figures for 1958,and round them off to the nearest onethousand dollars.

In 1958. National Rpine'y did sub-stantially better than in 1957, thanksto an increase in circulation, and the

OCTOBER 10, 1959 393

launching of the ATottoTHiI ReviewBulletin. Even so, our operatingdeficit was $136,000.

What does it take to put out a mag-azine like National Review (other,that is, than a good hold on theeternal verities) ? Last year (the fig-ures include three months of the Bul-letin) National Review paid out $390,-000; it took in (not counting gifts)$254,000.

With a circulation of 29,000, NationalReview's cost per subscription istherefore $13.45.

We published a total of 1,040 pages.Distributing the total cost evenly, wesee that each page costs $375.

The editorial cost of the magazineis $96,000, or an average of $92 perpage; 24.8 per cent of the total cost

The printing cost (including paper)is an almost identical $95,000, an aver-age of $91.50 per page; 24.3 per centof the total.

The circulation and promotion costis $75,000, an average of $72 per page;19 per cent of the total.

The business and administrativecosts are $123,000, $118 per page; 31.5per cent of the total.

One can see that if National Reviewiiad merely to pay the people whowrite the words, and pay the printerto put those words on paper, we couldget on with half the money we nowneed. But; who would read the man-uscripts sent in, pay the postage tocorrespond with the writers, type theaccepted manuscripts, make up theeditorial pages, travel to the printerto oversee the operation, proofread,pay the artists and the engravers?Who would supply the mailing wrap-pers, pay for them, pay the postage,draft promotion mailings, print them,answer questions, service subscriberrequests, change addresses? Whowould answer the phone, examine thebooks, do the legal work, buy the of-fice supplies, pay the rent, set pub-lishing policy?

On the editorial side: Non-salariedwriters for National Review receive atotal of $28,000. They are paid at therate of five cents per word ($50 perprinted page), and a maximum of$150 per article. (The Reporter paysabout nine cents; the New Republicand the Nation slightly less than Na-tional Review.) Salaried writers earnat rates ranging from a little more,to a little less, than the five-cent rate.Per year, $25,000 is paid to the nine

people who contribute whole or parttime to editorial chores, an average of$2,777. (The editor contributes histime.)

Under Business and Administrationare included salaries for eight per-sons; the Publisher (who is also Bus-iness Manager), Assistant Publisher(who also serves as Promotion Man-ager), Office Manager, Bookkeeper,Production Editor, two stenographersand a telephone operator ($39,000);rent; payroll taxes; interest; legal andauditing expenses; insurance; postagefor the Magazine and the Bulletin;and that whole array of individuallysmall items that swell the generalcategory of "overhead" — telephoneand telegi-aph charges, dues and sub-scriptions, utilities, miscellaneoustaxes, and the like.

Then and Now

The increase in the cost of publish-ing in recent years, over and aboveinfiation, aggravates the special prob-lems of the little magazines, to whichI have already alluded. Consider thepast twenty-five years: the contrastbetween the cost of publishing a mag-azine in 1958 and in 1933. In 1933, theNew Republic, a magazine exactiycomparable, with a circulation almostexactly equal to that of National Re-view, published 1,664 pages—at anaverage cost of $135 per page.^ Using1933 dollars. National Review's costper page in 1958 was $156, sug-gesting that National Review ismore extravagant. However, the costof paper and print has infiated muchfaster than the dollar, offsetting the15 per cent apparent difference incost-per-page. The 1933 dollar haddepreciated, in 1958, to 40 cents. Butcompared to 1933, a dollar would onlybuy you, in 1958, 32 cents worth ofpaper-and-print. This indicates thatin terms of costs, the efficiency ofNational Review, as a publishing en-terprise, is about equal to that of theNew Republic in the early thirties, inthe height of the Depression.

Now consider the income figures.In 1933 the New Republic took in$168,000 by selling its magazine at abase rate of $5.00 per year.

In 1958, National Review took in$211,000 by selling its magazine at a

iThc fiftures for the New Republic are deriTedfrom the dear recollection of a former oiEcial ofthe magazine, for the period 1930-1935.

base rate of $8.00 per year. Eventhough, in 1958, one needs two andone-half times more than in 1933 topurchase the same goods and serv-ices, owing to the depreciated dollar.National Review's subscription rate isup not two and one-half times overthe New Republic's, but up only 60per cent Now if National Review hadreceived, in 1958, for each subscrip-tion, a sum of money with the pur-chasing power of five 1933 dollars(i.e., if we had charged $12.50 per

subscription), our subscription incomewould have amounted to $329,000 in-stead of $211,000; and our deficit of$135,000 would have been reduced by$118,000—leaving a net deficit of arelatively painless $19,000. In otherwords, if the reading public had al-lowed periodicals to keep pace withthe rise in price of automobiles, rolls,dog collars, or cigarettes, publish-ers' hair would not tum white soearly in life.

In spite of its relatively lower costs,the New Republic had in 1933 a deficitof $63,000. In 1958 doUars, that is adeficit of $157,000—or a greater deficitthan National Review's. This wouldindicate superior relative efficiencyby Wational Review in attracting non-subscription income, e.g., through ad-vertising.

Maybe Not Tomorrow

The question we most often hear atNational Review is: "At what pointdo you break even?" That is not aneasy question to answer, because rela-tive costs change with an increase involume, and advertising revenuesalso tend to increase.

But assuming income from sourcesother than subscriptions were to re-main constant (our advertising in-come during 1958 was $29,000), andthat the price of paper and printwould not decrease substantially withhigher print runs: assuming that,what would it take for National Re-view to break even?

What profit does National Reviewmake from a single subscription?None, of course, if you count theoverhead. But taking the overhead asa fixed cost, then how much? Theanswer is: it depends. It depends onhow much money was spent in at-tracting the attention of the sub-scriber—on the .so-called promotion

(Continued cm p. 407)

394 NATIONAL REVIEW

CAN A LITTLE MAGAZINEBREAK EVEN?

(Continued jrom p. 394)

cost of his subscription; or, if he isalready a subscriber, on how manyletters (they are costly) need be sentbefore he gets around to renewing.

Some subscriptions, of course, comein wholly unsolicited. Even thoughthey are negligible in number, theyare worth looking at because, costingus nothing to get, they serve an il-lustrative purpose. Of the $8.00 thatcomes in "over the transom" for asingle subscription. National Reviewwill end up spending $4.25 in fxUfill-ment costs, i.e., for paper, print, han-dling, postage, and subscription main-tenance. Our surplus from that sub-scriber is $3.75. Less than 1 per centof our subscribers come in hy thatroute.

The subscription renewal, however,is an important staple. It yields us,after deducting the cost of the two orthree reminders usually required tobring the renewal in, $3.50.

The subscriber who responds to oneof our typical promotion mailings willsend us a check for $8.00. We willspend the regular $4.25 on fulfillment;but additionally, we will have spentan average of $3.00 per subscriptionon the promotion that called NationalReview to his attention. Which meansthat three dollars of the $3.75 poten-tial profit on his subscription are con-sumed, leaving us only 75 cents.

Now in the year 1958, total sub-scriptions were about 50 per cent new,and 50 per cent renewals (our re-newal rate runs 60 to 75 per cent).The average profit, then, is derivedby adding $3.50 for the renewal, and75 cents for the new subscription, anddividing the sum by two, which ouraccountants have done for us. Round-ing off their result, we arrive at thefigure $2.15.

Therefore, assuming our subscrip-tion list continued to grow in thesame proportion as in 1958, t.e., halfby renewal, half in response to pro-motion, and that the deficit stayed at$135,000, we would break even withan additional 62,719 subscribers.Added to our present subscription lbtof about 29,000, this would give us atotal mailing of 91,791. It is probahlynot an exaggeration to say that whenthere are that many literate andaroused conservatives in the land,the country will break even too!

What do these figures mean forNational Review and for other jour-

nals of opinion? That solvency, fromthe straight publishing activity, is faraway. To be sure, we are headed inthe right direction. Every year's def-icit has been less than the previousyear's thus far.

Though not yet four years old. Na-tional Review, with 29,000 subscribers,has already surpassed the circxilationof four out of the six weekly journalsof opinion. We are ahead of the Nation(24,000), the New Republic (27,000),the Commonweal (20,000), and theNew Leader (18,000), and are sur-passed only by religious weeklies,America (42,000) and Christian Cen-tury (37,000). Even so, our deficit issubstantial and alarming. NationalReview may not have to wait, to breakeven, until it has 91,000 readers. Themanagement has been trying to devel-op corollary commercial enterprisescapable of taking on a share of theload. Examples are the radio stationNatioTial Review now owns, but whichis not yet spinning off a profit; the Na-tional Review Btdletin, which coiildincrease our revenues substantially ifitcontinuestogrow; and other projects.

Meanwhile, National Review mustcontinue to depend, for its survival.

on those who view its purposes witiisympathy, can afford to contribute tothe political education of their nation,and are generous and dutiful enoughto want to do so. Journals of opinionare both educational and political en-terprises, and I know of no politicalenterprise that is self-supporting, andvery few educational enterprises; sothat it is not so very striking thatNational Review should have to tumfor assistance to those it seeks toserve, educationally and politically. Ifthe editors, feature writers, contribu-tors and book reviewers of NatioTialReview don't offer more educationthan all the teachers' colleges com-bined, we volunteer to spend the restof our lives studying Life AdjustmentIf National Review does not contrib-ute more to the political sanity of thenation than the League of WomenVoters and the Ford Foundationcombined, we offer our services, freeof charge, to Americans for Demo-cratic Action. If there is not, withinthe borders of this country, the sup-port that is required to keep alivea weekly journal of conservativethought, we greatly misjudge thetemper of America's conservatives.

PUNCHWith IBIRIAIDIYI self-Sticking

CORRECTION SEALSMade of super-thin Mylar®. . . feeds freely, won't jamequipment. Highly visibleopaque red color easy tospot. Fast to apply. Lowin cost. Order red and trans-parent seals from stock; sil-ver on special order. Sendfor free sample.

w. H. 775 W. GLENDALE AVE. . MILWAUKEE 9. WIS.

Manufacturers of Quality Pressure-Sensitive Tape ProtJucls • Esl. 1914SALES OFFICES: Atlanta • Boston - Buffalo • Chicago • Cincinnati .ClevelandDetroit ' Hartford • Los Angeles • Milwaukee • New York • Newark • Philadelphia

St. Louis • San Francisco • Bfampton. Ontario, Canafla

OCTOBER 10. 1959 407