It is time for the Fortune 500 to go. It should not be published again after this year. The issue will be mailed to the magazine’s subscribers in about a month. The franchise has become an annual reminder of what is wrong with Fortune and other big business magazines. Not long ago, putting a list of the 500 largest US companies ranked by revenue was prestigious for both the publication and the corporations. Annual revenue numbers meant something. They really don’t any more. Now, the yearly ritual is a reminder of the weakness of print. It is tied to freezing data at a moment in time and holding it there for a year. Much of that data used to change slowly but now changes daily.
Taking an annual snapshot of large company’s financial information for a calendar year lost its usefulness several years ago when the data became available online. Some figures included in the list, like market capitalization, change every day and the public has easy access to those changes. Other data, like annual return to investors, may lose their value before the magazine comes out.
Of the top 54 companies on last year’s list, one out of eight have either become insolvent or are no longer in existence because of forced mergers due to the results of poor management. Now, ten months later, they are still on the list, at Fortune.com, which only serves to remind people how senseless the process is.
BusinessWeek, Fortune, and Forbes have lost a large amount of their advertising revenue because of the significant downturn in the budgets of print marketers. The publications compound their problems by having flagship editorial products that become quickly outdated lists. It serves as a reminder to the reader that a great deal of what these media do is obsolete. This stale information, which is such a big part of Old Media business magazines, makes it easy for online sites like MarketWatch and Bloomberg to compete for the reader’s time. It demonstrates that magazines which often criticize corporations for refusing to change are killing their own businesses by hanging onto franchises which were valuable in the past but have almost no utility for their audiences now.
Magazines could turn what is a liability into an asset now that they have online editions. The Fortune 500 could become a living list that changes every day as the data on the companies do. The market cap rankings of each corporation should change every day, or instantaneously with every trade. Balance sheet and P&L data should not be for the last year, but for the trailing twelve months ending with the most recent quarter. Companies that fold or are taken over should come off the list the day of the event that changes their status. Changes in top management should happen the day that they are announced. Having Martin J. Sullivan listed as the CEO of AIG makes the content of Fortune.com outdated. Sullivan was thrown out months ago.
Killing the Fortune 500 would give readers the impression that the editors at Fortune had moved into the 21st Century. It would also allow them to replace the list with an alternative that would have real value.
Douglas A. McIntyre
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