It would appear that PlanetOut, the owner of many well known gay publications and businesses, is slated to run out of cash later this year:The San Francisco owner of Gay.com, along with the Advocate and Out magazines, disclosed this week that it will run out of money before the end of the year without an infusion of cash.
The company, which debuted in a 2004 IPO, is apparently having serious problems with their travel business, specifically RSVP cruises, in addition to fewer paid personal ads and a decline in advertising revenue (in print, I would assume). According to CEO Karen Magee, it will take 2 years to conduct a turnaround. That means that if cash runs out before the loan comes due, they will need to either get a fresh capital investment from somewhere, or move into bankruptcy protection.
Although I wasn't aware previously that they were draining cash, I figured there must be something serious happening with the cruise line. Advertisements were almost every 3rd page in the Advocate, with supplementals and on several occasions a copy of another periodical, Out Traveler. Also to be found many times in the Advocate were "articles" about cruises that weren't much more than a wordy advert.
I'm hopeful that they get the chance to enact the turnaround, although the capital infusion isn't going to come from their stock, which has been tanking almost since the day they IPO'd. But I do hope they are successful, especially since I am a fairly good customer. I participate at (and pay for) gay.com, subscribe to The Advocate magazine, and am giving serious consideration on going for a cruise. (Yes, the advertising and "articles" worked on me!)Now if they would just do something to freshen the magazine that would help them avoid collecting comments about them such as "by then the news will be so old even The Advocate will be reporting it" !
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