IDG Pulls Back From Mega-Portal

The shift marks a defeat for IDG's CEO and a blow to its employees. Also, two key company figures are stepping down.
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SAN FRANCISCO -- Technology publisher

International Data Group

has aborted its grand plans to create and spin off a giant Web portal, putting off the hopes of scores of employees hoping to cash in on an Internet IPO.

President and CEO Kelly Conlin announced the bad news in two meetings Thursday morning, according to three sources that attended the meeting. IDG executives declined to return repeated calls to its offices.

IDG, a Boston-based media conglomerate that owns a raft of computer magazines, a research firm, a conference unit and the "For Dummies" book publisher, had been

setting up an Internet division with an eye on an IPO later this year. As print competitors like

Ziff Davis

(ZD)

and new media upstarts like

CNet

(CNET) - Get Report

took the lead in online tech content, IDG has been under pressure to devise a more potent Internet strategy. The mega-portal was supposed to address those concerns.

The venture had received high-level support from Patrick McGovern, the company's 62-year old founder and chairman, who said earlier this spring in the

Boston Herald

that IDG might spin off four or five IPOs in 1999, including one that grouped together its network of Web sites. In a May 26 article in the

San Francisco Chronicle

, CEO Conlin said the venture, code-named

Web IDG Networks

, would roll up IDG's 240 Web sites into one mega-portal.

"The whole thing fell apart," says one IDG employee who attended the meeting.

Rather than lump all of IDG's online properties into one mega-portal, the new plan is to create three separate units, a strategy that one IDG executive said will push back IPO plans. One prong will contain the online versions of IDG's enterprise magazines such as

ComputerWorld

and

NetworkWorld

. Another will include

PC World Online's

properties. And the third centered around IDG's gaming unit

GameProWorld.com

.

Insiders say the move is a defeat for Conlin, who had been the chief champion of the all-in-one venture within IDG. "The big question is, how long can Kelly Conlin realistically stick around?" says one IDG employee.

At the meeting, Conlin announced the resignation of Thomas Gewecke, the publisher of

PC World Online

and the CEO and major champion of the new business unit. Gewecke, one of IDG's golden boys who led its Internet efforts by growing

PC World Online

into a formidable computer site, will stay on to the end of the month to help "lead the transition."

IDG.net

president Laurie Morgan is also leaving the company, say sources.

The shift in strategy is also likely to trigger a wave of defections from the company's rank and file. IDG was hoping the Web IDG venture would help stem a brain drain. Over the last few months, the company has lost

PC World

President Rich Marino to CNet,

PC World

top salesman Bob Carrigan to

Spinner.com

and

ComputerWorld

president Jim Martin to

Netscape

.

Insiders expect the news to spark further defections among IDG's remaining 170 employees. "The general feeling is that there'll be nobody left here in a month," says one employee of Web IDG. "People have stuck around here for a year thinking that they were going to be working for an Internet company."

"I really don't think they understand the ramifications of any of this. They still think IDG is a great place to work," laughed one employee. "Most people weren't that happy before April."