The US business of Readers Digest is going into Chapter 11. The immediate cause is the company’s need to restructure $1.6 billion in debt and to move ownership of the company to its lenders. The story is more complex than that. Two-and-half years ago, private equity firm, Rpplewood, led a buyout of Reader’s Digest for $2.6 billion. The problem at this stage is that Reader’s Digest does not make money.
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The sad part about the Digest is that it served a large audience well and long. That may be why magazine publishers facing the shrinking subscribers that they have left cannot bring themselves to believe that many of the publications will die and die very soon. The Digest won’t make it much longer because its audience is too old. The content that it digests or runs is too easily available elsewhere on the internet—“the dos and don’ts of corporate culture”, “six healthy fish recipes”, and “8 medical myths”. The Digest was always quaint. It never had much of an edge. That was comforting to millions of people. It is not comforting enough for them to pay for the Digest in great numbers. Due to their age, they are also dying off.
The Digest is a precious part of the media founded in the first half of the 20th century that will not make it through the first decade of this one.
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