Here’s the latest financial snapshot of our Society
via IRS Form 990:
It’s worth noting that in just four years:
- Revenue from membership has dropped roughly $25 million, or 16 percent.
- Net revenue has nosedived by $76 million (96 percent).
- Net assets have dropped $190 million (21 percent).
The good news, if you’re simply counting the money, can be found at National Geographic Ventures (NGV), our Society’s wholly-owned and taxable subsidiary. NGV is the corporate umbrella for all our new media and digital initiatives. It’s also the legal home of the National Geographic Channel, which is majority owned by Rupert Murdoch’s News Corp. (NGS has roughly a 30% stake in this joint venture.)
From all indications, the Channel appears to be a huge financial success. Exactly how big a success for NGS is difficult for me to quantify because NGV’s tax returns are not available to the public. But the 990s provide a hint about how much money is coursing through the Channel. On Schedule R (Related Organizations and Unrelated Partnership) in the 2011 filing, you’ll see this:
Column “f” says our Society’s share of the Channel’s income is more than $201 million; about half that amount is paid to the Society, while the remainder is retained to help the Channel grow. And grow it has: column “g” — $1.49 billion — represents the Society’s 30% share of the roughly $5.0 billion value of the Channel itself.
$1.5 billion out of $5.0 billion. That’s pretty serious money, especially when the Society’s initial investment in the Channel was less than $140 million.
How did the Channel do it? Why is it generating such impressive returns and experiencing such dramatic growth?
The short answer: People apparently love the programs about gangs… Nazis… drugs… prisons… sex addiction… prostitution… the Bikini Test… men who are sexually intimate with inflatable dolls… a woman who is addicted to having sex with strangers in a parking garage (with requisite on-screen analysis by a behavioral scientist)… Cops… lesbians in a Brazilian jail… and so on & so forth, ad nauseam.
Programming brilliance? Not really.
Then again, this discussion really isn’t about Rupert Murdoch. We’ve always known who he is.
In the end, this is about who we are, and who we want to be – as a Society and as a society.
♦ Can National Geographic put its iconic name & logo on fairgrounds & brothels (the Channel) and, at the same time, on libraries & nunneries (i.e., the Magazine) — and still be taken seriously by the public?
♦ Can National Geographic build a sustainable future on a network of brothels, which are raking in the cash, while the libraries wither on the vine — and the Society’s members continue their mass exodus?
♦ Most of all: How can John Fahey manage the National Geographic brand when the Channel, which reaches hundreds of millions of people around the world, is beyond his editorial control?
Put another way: What happens to The Brand’s hard-earned reputation when the Channel showcases stuff like this in prime time…
… and programs like this one called Sex for Sale, which is about “high-end sex work”…
… while our Chairman & CEO shows this earnest face to the public:
… but makes jokes in private about the Society’s embrace of “factual fiction”:
From a no-nonsense, hard-headed business perspective,
is this wise brand management?
And: Is it sustainable?
We posed that question to Professor Sanal Mazvancheryl,
an expert in brand management
who teaches at the Kogod School of Business at American University: