August 20, 2009

Reader's Digest Facing Bankruptcy

Looks like Reader's Digest is facing the same woes other businesses are facing these days. This story was in BBC News.

"The US publisher of Reader's Digest magazines has said it will file for Chapter 11 bankruptcy as it looks to get rid of up to 75% of its debts.

If approved by a bankruptcy court, Reader's Digest will see its debt cut to $550m from $2.2bn.

"It doesn't affect our employees, it doesn't affect the vast majority of vendors, it doesn't mean we'll do mass layoffs, it doesn't mean we're going to be selling off assets. It's business as usual."

The company says Reader's Digest is the largest-selling magazine in the world."

While my children were growing up, the Reader's Digest was like part of our family. We all read stories in it and we talked about it at dinner and made games of the word definitions in the magazine. My mother still subscribes. The image in this post is the way the front cover used to look; this one is the cover for May 1973.

I haven't read a Reader's Digest in a few years and I don't see this little magazine in the waiting rooms I frequent, but I have a sentimental interest in the future of this publication.


Shadow said...

like you, readers digest reminds me of my childhood and waiting rooms. this is sad...

Margie said...

I loved reading Reader's Digest and still do (I have a freind that has a subscription and she always lets me borrow the magazine )
Sad to see it end up this way.

Julie said...

That is sad. I had no idea they were struggling. With the new digital age, I've heard that a lot of print media suffers. My memories are similar to Shadow's. I think of waiting rooms. I wonder if Highlights for kids is still around? I used to love that one, too.

Badass Geek said...

I, too, grew up with this magazine. I'd be sad to see it go under.

Ina in Alaska said...

Sad! I used to enjoy the little jokes in RD too!

On another sad note, we will not see the likes of another Don Hewitt (60 MInutes) any time soon! What a broadcast pioneer!

cinner said...

It would feel odd if they were not around that's for sure. We had them in our house.

A Free Man said...

I think that their target demographic is starting to die off. I always think of Readers Digest as something that my grandparents read. No offense, I know other people read it as well, but it's just from an older time. Can't compete.

Spencer L Casey said...

It's sad certainly, but nothing is going to change, so it's all good. The only losers will be the banks who loaned them the 1.5 billion dollars and must forgive the debt and show a loss on their income statement.

They'll probably have to come up with a plan that will show they can be viable in the near and distant future, which they can certainly do. Just reducing their debt service by 75% may do it, the payments of which are about 7 million dollars a month.