Earl Graves: Essence Should have let Blacks Bid on the Magazine
By: Makebra M. Anderson
NNPA, National Correspondent
Originally posted 1/11/2005
WASHINGTON (NNPA) – Earl G. Graves, publisher of Black Enterprise, says that before selling to Time Warner, the owners of Essence magazine should have allowed Blacks companies to make an offer to purchase the company.
Time Warner, the largest publishing company in the world, had previously purchased a 49 percent stake in Essence Communications, the parent company of the magazine. With Time Warner moving many of its people into key positions on the business side, it was expected that it would eventually make a move to acquire total ownership of the Black women-oriented publication.
“In selling their controlling interest to Time Warner, CEO Ed Lewis and the shareholders of Essence Communications have made the best deal they felt they could make. It is unfortunate, however, there wasn’t an open bidding process in which Black entrepreneurs could have made an offer for the company and possibly preserve Essence as a Black-owned business and institution. There are a number of Black entrepreneurs—including those who own and operate BE 100s companies—who had the resources and management capability to acquire and run Essence Communications,” Graves says in a statement.
The sale of Essence is part of an accelerated trend of major Black businesses being bough by White-owned companies. That list includes Johnson hair products, Motown, Black Entertainment Television and now Essence. With the U.S. population expected to grow by 50 percent over the next 50 years –, with 90 percent of that growth among people of color—major White companies are expected to increasingly seek of buy Black companies.
Robert L. Johnson, who sold BET to media giant Viacom, contends that’s not necessarily bad.
In an interview with Richard Prince, author of the “Journal-isms” column for the Maynard Institute, Johnson said, “Black businesses will have to realize that to be in business takes precedence over being Black, if you’re going to grow your business.”
He told Prince that other Black businesses, such as Radio One, will eventually follow suit.
“At the end of the day, they will sell to the highest bidder” who will likely be White,” Johnson said. “It’s just a question of when.”
Time Warner Inc. agreed to buy the remaining 51 percent of Essence Communications, which publishes ESSENCE and Suede magazines, that it didn’t already own in a non-binding agreement that would add the lifestyle publications to its magazine division. Time Inc. currently publishes Time, People, Entertainment Weekly, Sports Illustrated, InStyle, Real Simple and Fortune magazines among others. Time Inc. bought the other 49 percent of Essence Communications in 2000.
“Since I’m a proponent of Black entrepreneurship, it’s sad that it’s [Essence Communications] is no longer a Black-owned company, but in recent years there have been more partnerships between Black owned companies and general market companies to fulfill the goals that both sides have,” says Yanick Rice-Lamb, former editor of Heart & Soul and BET WeekEnd magazines. “From everything I’ve heard, it has been a win/win situation for Essence and Time. Essence will be able to leverage some of Time’s resources, which will ensure that it will last longer and even endure into the next millennium.”
Some say that should not be the only consideration.
“It reminds me of when Bob Johnson sold BET to Viacom. You can’t blame Bob for worrying about his bottom line and I don’t have the right to demand of him to take losses, but I’m still upset that we lost some great magazines like Emerge and YSB in the process. Essence has always been a clear voice for Black women and you have to be concerned that the focus of the magazine will start to blur,” said Joe Ritchie, professor of journalism and Florida A & M University. “When Time Inc. bought the first 49 percent, it was already a little worrisome. Essence has always been about the images of Black women in America and in the Black Diaspora. Having that image under total control of White media is troubling.”
Ed Lewis, Chairman and CEO of Essence Communications and Publisher of Essence magazine said in a statement that the partnership with Time Inc. will strengthen Essence.
“Once the deal has been approved and we become and full-fledged member of the Time Inc. family, we’re looking forward to aggressively broadening the scope of the Essence brand and penetrating new markets around the world,” he said. “It will give me great pride and comfort to know that Essence will be secure for generations to come and that its prospects for even greater success with be brighter than ever.”
Lewis will remain on board as non-executive Chairman and Founder of Essence and current Group Publisher, Michelle Ebanks, will become President of Essence Communications.
Some of the most successful media companies that remain Black-owned include Tom Joyner’s Reach Media, Radio One Inc., which is headed by Alfred Liggins and Catherine Liggins Hughes, Black Enterprise, which run by Earl Graves and Johnson publishing, which publishes Ebony and Jet magazines.
Despite concerns that Black-owned businesses are a risk, most understand that business is always about the bottom line.
“The magazine business has become more difficult over the years because it takes a lot of money to run a magazine and it takes a long time to make a profit. Essence would have continued to remain strong, but since Time is so large and has so many successful publications there is no way they can’t benefit from that,” she said. “You’re always going to get criticism anytime you merge with a larger corporation—whether it’s Black- owned or not because people like to see Black-owned companies. We have the time-honored tradition 'to much is given, much is expected', but a lot of business people are about the bottom line. At the end of the day, it has to be profitable and whatever it takes to make that happen they will do.”
Ritchie is not impressed by that argument.
“It’s a shame to see Essence go because the magazine was really about quality and maintaining its role as the defying entity of African-American culture as far as the image of Black women was concerned,” he says. “It didn’t’ matter what your socioeconomic status was, if you were a Black woman, you paid attention to Essence. I would much rather something that plays such a major cultural role in the African-American community be in the hands of Black people.”