Vox Media first suggested its podcast network was for sale last November, when Axios reported that the Vox Media board had floated the idea. Since then, a handful of suitors have expressed interest, with Versant, a spinoff company formed in January when Comcast divested its cable assets, leading the pack.
Behind the VMPN, New York Magazine is arguably the second or third-most attractive asset in the Vox Media portfolio. It generates revenues of roughly $100 million, although its high cost of production left it with only around $6 million in profit last year, according to Puck.
The storied magazine has such unflattering margins, in part, because it is funneling its top-line earnings into growing its subscriber base, which counts around 400,000 paying subscribers, according to a person familiar with business. In making a bid for the crown jewels of the Vox Media empire, Murdoch creates a more complex sales process, although one the sellers are likely happy to accommodate.
The offer immediately introduces an element of urgency to the auction, as Vox Media can now feasibly play Versant against Murdoch. As we saw in the Warner Bros. Discovery bake-off even a little competition can be instrumental in driving up the price of an asset.
Vox Media is favoring Murdoch over Versant, as the former is offering more cash than the latter, according to The Times. And while such a note could mean the end of the bidding, it could also spur Versant to up its ante.
Regardless, Vox Media is undoubtedly pleased to have at least two public suitors for its podcast network. It now has a near guarantee that one or two of those assets will move off its books.
But that creates a few related problems.
First, both offers involve only the best assets in the Vox Media empire. Selling New York Magazine and the VMPN was never going to be the hard part. The challenge was always the rest of the portfolio, which includes everything from Eater to The Verge to The Dodo.
Second, it leaves Vox Media operating a business that it has already decided is less important than podcasting, according to a source close to the deal. Selling its core assets will leave the rest of the Vox Media business diminished. Under those circumstances, its best bet might be to sell the rest as quickly as it can.
The sale could also present another problem: Depending on the structure of its capital tables, Vox Media might not even see the bulk of the cash proceeds from the sale, according to the source.
