Penske Media and MRC form joint venture combining control of Hollywood, music titles

Penske Media Corporation (PMC) has joined forces with MRC to bring together entertainment magazines including Variety and the Hollywood Reporter, as well as create a new partnership for film and television content.

In joint statements released Wednesday, the companies announced they’ll each have stakes in two new joint ventures to manage the suite of influential industry titles. One entity, PMRC, will house publishing outlets of both companies, bringing together Billboard, Rolling Stone, Vibe, Deadline, IndieWire and WWD along with Variety and the Hollywood Reporter, and be managed by PMC. Another joint venture managed by MRC — producer of film and TV including Netflix drama “Ozark,” Hulu documentary “Fyre Fraud,” Lionsgate feature “Knives Out” and the Golden Globe Awards (via its Dick Clark Productions division) — will be tasked with creating intellectual property from across the publications for new TV, film and live events. Financial terms weren’t disclosed.

“These are all brands I’ve long admired,” said PMC chief executive Jay Penske. “Billboard, the Hollywood Reporter and Vibe have created some of the finest content in their respective industries and have contributed immensely to the heightened quality of journalism covering entertainment and music today.” The deal will “continue the legacy of these tremendous brands for the next many decades,” he said.

Some industry observers noted on social media the coincidence of choosing the name PMRC for the new publishing venture. It was the acronym for the Parents Music Resource Center, a 1980s campaign against explicit rock lyrics — cofounded by Tipper Gore, then the wife of Sen. Al Gore — that led to parental advisory labels on albums and a series of Senate “porn-rock” hearings.

The Penske-MRC pact brings under one roof three competing entertainment trade magazines in MRC’s Hollywood Reporter and PMC’s Variety and Deadline; likewise rival music titles Billboard and Rolling Stone. It follows several years during which automotive scion Jay Penske has been collecting digital and print titles.

The joining of forces of these two L.A.-based companies comes as many publications face a slowdown in advertising spending in the wake of the COVID-19 pandemic. Evidence of a shakeup was emerging Wednesday: MRC’s Deanna Brown, president of its Billboard-Hollywood Reporter Media Group, will depart the company, according to the Wrap. MRC and Penske representatives were not available for comment.

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“We have a great deal of respect for Variety, Rolling Stone and Music Business Worldwide and, as importantly, the leadership at PMC, who we’ve gotten to know well and look forward to partnering with in both these businesses,” said MRC CEOs Asif Satchu and Modi Wiczyk in a statement. MRC, which also has a stake in film company A24, will continue to be led by Satchu and Wiczyk and it will continue to run independently of PMC, the companies said.

The combination of a suite of publications all fighting for the same audience highlights the pressure on these titles at a time when the entertainment industry is under threat from the pandemic. These Hollywood publications are largely fueled by ad revenue tied to industry awards and film and television releases. But the pandemic has made awards shows much less prominent and studios have delayed major film releases.

“In many ways it’s not terribly surprising given the fundamental headwinds the publishing industry was facing even before COVID-19 — and then layer the existential crisis that is acutely affecting the media industries,” said Rich Greenfield, partner at technology, media and telecommunications research firm LightShed in New York. “Combining forces makes sense to reduce costs and increase industry leverage.”

Both the Hollywood Reporter and Variety saw significant leadership changes in recent months. Longtime editorial director Matthew Belloni departed the Hollywood Reporter in April following a dispute with the publication’s owners over its editorial independence.

Nekesa Mumbi Moody took over as the publication’s executive editor in June. Belloni, a former attorney and 14-year veteran of the Hollywood Reporter, had been part of the leadership that took the print magazine from a daily trade newspaper to a weekly glossy with a big digital presence. In February, the Hollywood Reporter had 25 million unique visitors, according to the publication at the time.

In June, Variety Editor-in-Chief Claudia Eller was placed on leave after she got involved in a social media spat with an entertainment industry journalist. The online disagreement followed a column by Eller in which she acknowledged the title had not done enough to engender more diversity in its ranks. Eller lashed out at a former Hollywood Reporter staffer, Piya Sinha-Roy, who took issue with the piece on Twitter.

Eller joined Variety as its editor in chief in 2013, after two decades at the Los Angeles Times as a business reporter covering the film industry.

Earlier this year, PMC made a further investment in the live-event space, taking a stake in event management and technical production agency LDJ Productions. It also launched a sports business industry platform called Sportico, providing news and live media.