Yesterday, as reported by the Wall Street Journal, Complex Media was the subject of an acquisition by Verizon Hearst Media Partners, the joint-venture launched earlier this year by the communications and media giants. That news followed a $21 million investment by Hearst Corporation last September.
Complex Media started as Complex, a bi-monthly magazine from successful clothing designer Marc Ecko — whose rhino-adorned hoodies should be familiar to anyone alive in the ’90s — launched in 2002. The magazine spent the next several years chasing solvency (co-founder and CEO Rich Antoniello said in an oral history that the project had lost “about a million-and-a-half bucks in the second year”) and a voice.
Then, in 2007, the magazine joined the rest of the world and digitized its hip-hop-oriented lad-mag business. Since that pixelated flag was planted the company has expanded aggressively online, launching new verticals and acquiring complementary publications like Pigeons and Planes. Its family tree now draws about 50 million unique visitors per month.
“The decision to acquire Complex is certainly a continuation of our media strategy, which is focused on disruption that is occurring in digital media and content distribution, and involves building a portfolio of the emerging digital brands of the future for the millennial and Gen-Z audience,” as Brian Angiolet, senior vp consumer product and marketing at Verizon, was quoted by Billboard sister publication The Hollywood Reporter yesterday.
Ecko spoke to Billboard today about what the Hearst-Verizon deal means for his company, and helps put it in context around the current and near-future of digital media.
Billboard: Can you give me a sense of what the talks with Verizon were like?
Fascinating and awesome [Laughs]. I think these are like the early days of cable, in that there are some structural formations happening in this industry — as we all know. The dominant role of Google and Facebook in our businesses. We know the proliferation of mobile is changing behavior and consumption. This joint venture is designed to take the best practices of the qualitative art of our industry [and join them to] a future-looking, quantitative, analytical approach. Which Verizon can offer in ways that, if we were to remain independent, we couldn’t by ourselves. These are the dimensions that inform our strategy andthat made this a very attractive offer for us. Mostly, we’re going to do what we do best, focus on our voice, keep pushing forward with our brand and hopefully making really fucking awesome stuff.
Complex has seen a striking amount of consumption growth from video, no?
We’re kind of like the greatest story that’s never been told, we feel “told-you-so” a little, by growing a profitable business and taking on iterations from print to digital to social to video. We’ve established in the market that we’re great operators. That’s what made this work for Verizon and Hearst, and why the core of the management team and the org are fired up about this opportunity. We are a 14-year-old overnight success.
From the outside looking in, there’s a parallel between this deal and Conde Nast’s acquisition of Pitchfork — Hearst didn’t have a successful, millennial-focused publication. Now they do.
This is unique, because it’s a brand new joint venture between Verizon and Hearst to establish a paradigm shift in digital media. This isn’t about Hearst holdings, we are not captive to Hearst. We are an operational foundation for this new joint venture. [Complex] lives remotely from Hearst and Verizon; their objective is to disrupt digital media. They looked at us for our operational rigour. Yes the tone, the voice — these things are qualitatively important, but it’s about a very entrepreneurial group. As engines go, this is a pretty good engine. I do not think it’s synonymous with [the Pitchfork deal].
[At this point in the conversation, a Complex communications executive points out that the company will remain independent from both Hearst and Verizon.]
What does this paradigm shift you’ve referred to look like?
I don’t want to speak for anyone — if you look at the ingredients in the kitchen, and the massive distribution and data infrastructure, mobile data infrastructure, in the Verizon family of assets… The Times pointed out that 85 percent of every dollar in digital media is now attributed to Facebook and Google. There are shifts happening in the marketplace that, I think, a distribution giant like Verizon could help create alternatives to. Or [could help to] create more of a marketplace. Putting content and data together, right brain and left brain, is at the heart of this joint venture — from what I understand.
What do you see when you look at this media consolidation?
At the end of the day, differentiation and ideas — quality of voice, ultimately — will be the catalyzers of what is consumed or not consumed. The great efficiencies provided by these utilities, the big digital media companies like Google and YouTube and Facebook — don’t happen in spite of themselves. They happen because of us. These are important partners, they’re helping to create a marketplace, and the consumer is voting. We can’t play ostrich.
This is a challenge to the rest of media to reconcile these necessary adaptations. The good news is that the art of this business cannot be trivialized — there is no algorithm that can replace the right ideas getting together and turning those into reality. I think not much has changed under the sun in that way — other than we can’t be afraid of our shadows.
I think of the terrestrial radio consolidation that began in the late ’90s — now you look around and its iHeartMedia, it’s Clear Channel, it’s CBS Radio… and that’s pretty much it. Do you worry about people hearing from less voices?
I would challenge that — markets go through these consolidation cycles. Anecdotally, through my own experiences and my kids experiences, there’s a lot of room for a lot of voices and a lot of disruptions. How do we explain Snapchat? it’s a completely new paradigm. We can wax poetic as we brush our shrinking hairlines back, but there will be always be a disruptive young guard challenging us.
Terrestrial radio — sure. But then streaming music came. The emergence of podcasts. Independent content creators managed to figure out: “I have a voice.” I’m not so reductionist — that’s the western way, to be reductionist and make sense of all the parts.
So: Anyone who’s an independent voice out there — video producer, content creator — come see us.
This interview has been condensed and edited for clarity.