Wired looking to sell Net `zines'

Wired Ventures is preparing to sell all or part of Wired Digital, its online division whose products include HotWired and Wired News, according to sources.In addition, the company has all but abandoned the LiveWired push product, the sources said.

Wired Ventures is preparing to sell all or part of Wired Digital, its online division whose products include HotWired and Wired News, according to sources.

In addition, the company has all but abandoned the LiveWired push product, the sources said. Andrew DeVries, a spokesman for Wired, denied that the company was shopping around its online properties. "That rumor is totally wrong," he said.

However, rumors began to circulate about the imminent sale of Wired Digital, which has never turned a profit despite relatively good traffic and widespread Internet influence, after a Wired editorial board meeting that extended into early Wednesday morning.

DeVries said Wired "has not held a board meeting in weeks."

"It's no rumor that Wired's electronic properties have been floundering," said Patrick Keane, Jupiter Communications consumer content analyst. "Why don't they just stay in the business of producing a profitable magazine?"

While not wishing to comment on speculation regarding any imminent sale, Keane said Wired has run into a dire money crunch after two attempts to sell stock in the company failed to impress Wall Street and were eventually abandoned.

"Without question, failing to launch an IPO definitely hurt them and it also didn't help they were losing money at a steady clip," Keane said. "I know they've been aggressively pursuing independent financing, but they haven't been able to get it."

"A good question is who would want to buy them," Keane said.

DeVries rejected suggestions that the company was in a cash crunch, saying that Wired had raised $21 million in January and a "smaller cash infusion" during the first quarter of this year.

A former senior editor at Wired Magazine, who asked not to be named for this article, said potential buyers might include S.I. Newhouse's Advance Publications, which is already a substantial investor in Wired Ventures; and Ziff-Davis, which owns and operates ZDNN.

A spokesman for Ziff-Davis had no comment.

The source said any possible sale or additional layoffs are now virtually a given since Wired is operating in perilous financial territory, and founders Louis Rossetto and Jane Metcalfe face losing some of their interest in the company.

"They need to hit certain financial targets by the end of the year," the former editor said. "It's critical that they hit those to satisfy the investor demands, or they face losing a percentage of the company" as a penalty set as a condition of the original investment.

The source didn't rule out a sale of the entire company, including the magazine and other non-Internet business units such as its book publishing division.

Wired Digital recently ordered the dismissal of 30 staff members.