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The plan under which Time Warner Inc. (NYSE: TWX) will spin off its Time Inc. magazine division received mostly negative press, particularly about the fate of the print operations. Most analysts believe that Time Inc. cannot improve profits without ongoing cost cuts. Confidence that the operation can improve revenue from digital initiatives was low.

The New York Times reported:

The prospects for a stand-alone Time Inc. are far from certain, although Time Warner executives point out that AOL also faced bad press and double-digit declines in subscription and advertising revenue when Time Warner spun it off in 2009. Since then AOL’s return to investors has grown by 86.9 percent, according to Time Warner.

The outlook is potentially less bright for Time Inc. The publisher has experienced a 30 percent decline in revenue in the last five years. And unlike News Corporation’s newly formed publishing company, which has a benevolent chairman in Mr. Murdoch, Time Inc. and its 21 magazines face a leadership void.

And from the Wall St. Journal:

As the largest U.S. magazine publisher, Time Inc. has an enviable stable of titles, from the highly profitable People to the prestigious Time. But its operating income has dropped by roughly half over the past five years, and analysts expect revenue and profit to keep falling this year as the industry struggles to regain advertising lost to the recession and the Web.

“In this case, freedom is just another word for nothing left to lose,” wrote Michael Nathanson, an analyst for Nomura Securities who used to work at Time Inc. “This once proud and profitable division is being punted as its business prospects look structurally challenged.”