Behind Atlantic Media's Growth: A Return to Profits at The Atlantic

For a company that's been around in one form or another for 153 years, Atlantic Media is showing a lot of initiative. There's The Atlantic's new iPad edition, a straightforward digital version of the print magazine; another upcoming, subscription-based iPad app that will integrate content from both print and the Web; a slew of other possible apps that are still at the idea stage; and, of course, a total overhaul of the National Journal group, including a website relaunch and a new roster of all-star editorial talent.

Whew.

All this innovation takes money, of course, and these days some of those dollars are coming from a surprising source: from The Atlantic itself. The magazine is on pace to be profitable this year for the first time in many years, according to Justin Smith, the company's president (pictured). The growth is coming from both print and digital: November figures to be the single biggest month for advertising revenue in the publication's history, and Smith projects a year-over-year increase for 2010 of 45%. "We've been really fortunate to come out of the recession in a strong position," he says.

Getting Around an Apple Roadblock

Like most other publishers, Atlantic Media is anticipating strong consumer demand for apps, and it's racing to meet it. "We don't know what people are going to want to do on these new tablets, so we're experimenting with a few models," says Scott Havens, vice president of digital strategy and operations. Coming soon is Atlantic Premium, a paid product that will give users continuously updated access to all the content generated under the Atlantic brand, from 10,000-word features to blog posts.

Somewhat notoriously, Apple has so far refused to allow most publishers to sell subscriptions directly to consumers via the iTunes store, insisting on handling all the transactions -- and keeping the valuable information they generate -- itself. To get around this roadblock, the Atlantic employed a vendor called Urban Airship, which allowed it to offer a reasonable facsimile of a subscription, including renewal notices and choices of multiple subscription terms.

But Havens notes that it's far from the direct-sales holy grail publishers have been waiting for. "We're trying to be careful right now that we stay within the guidelines of Apple," he says. "Apple will maintain the customer relationship and take their 30% share."

The Appeal of Being "Treated Like Grownups"

Other apps are still on the drawing board, but one avenue being considered is to offer mini-apps that give access to the output of individual writers, such as Andrew Sullivan, whose Daily Dish blog continues to be the Atlantic's biggest traffic draw.

Then there's the makeover of the National Journal Group, which in late October will unveil a new Web home for National Journal, Congress Daily and Hotline. The three publications combined their staffs into one unified newsroom earlier this year. Buyouts reduced the headcount of that newsroom by about 40, but since then what Smith calls a "national talent search" has pushed that number close to its original total of 100. Among the newcomers are Editor in Chief Ron Fournier (formerly of AP), Editorial Director Ron Brownstein (formerly of the Los Angeles Times) and congressional correspondents Major Garrett (formerly of Fox News) and Susan Davis (formerly of The Wall Street Journal).

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"Very few people we hired were looking to leave where they were," says Smith. What lured them away, says Atlantic Media Vice President Linda Douglass (formerly President Obama's chief spokesperson on health care) was the opportunity to be "treated like grownups." "There's not someone hovering over you, telling you what to write, how to cover the story," she elaborates.

It's hard not to hear that as a dig at competitors, particularly Politico, from which National Journal plucked three of its new hires, and which has a reputation for treating journalists not as grownups but as drones to be micromanaged and driven incessantly.

But while National Journal's new staffers will be given time and space to do "deep, serious reporting" and "really good writing," they'll also be churning out a lot of content, says Douglass: "These are people who enjoy being prolific."