In the age of digital, magazine publishers are giving it one last shot.

Meredith Corp. (MDP) has just put together a $1.8 billion all-cash offer to acquire Time Inc. (TIME) while assuming another $1 billion in debt. A month ago, Hearst Corp. succeeded in convincing Maria Rodale to sell her family's publishing business, Rodale Inc., which includes Runner's World and Men's Health. Terms of that deal weren't disclosed.

On a smaller scale but noteworthy nonetheless, David Pecker's American Media Inc., owner of the National Enquirer, purchased Us Weekly and Men's Journal from Wenner Media LLC over the past year. More recently, Condé Nast Publications Inc. was in talks with private equity group Eldridge Industries LLC about acquiring The Hollywood Reporter and Billboard.

The shakeout comes as circulation sales for most magazines continues to decline, and two companies, Facebook Inc. (FB) and Google, a unit of Alphabet Inc. (GOOGL) , swallow two-thirds of all U.S. spending on digital advertising.

"I've been expecting consolidation much earlier in this industry because of its economics," said Peter Kreisky, a former Time Inc. executive and founder of Kreisky Media Consultancy LLC. "But it's now happening, and we should expect it to accelerate even more."

The horsetrading will leave U.S. magazine publishing more consolidated than ever with three dominant companies: Hearst, publisher of Cosmopolitan and Esquire; Condé Nast, publisher of Vogue and The New Yorker; and Meredith, publisher of Family Circle, Better Homes & Gardens and, if regulators approve the deal, Time's titles as well.

Given the changing habits or readers, mergers and acquisitions among magazine publishers were inevitable. Yet whereas newspaper companies have been bought and sold at a furious pace in recent years, magazine publishers have largely stood pat, in part because two of them -- Meredith and Advance Publications Inc.'s Condé Nast -- remained under the control of their original family investors.

But pressure has been building, and for Time CEO Rich Battista it began right when he was promoted to the top spot in September 2016. Despite the best laid turnaround plans, Battista had little choice but to entertain Meredith's laest buyout offer after Time reported third-quarter revenue that dropped by 9% while sales at its magazine businesses declined by 14% compared with the same period a year earlier.

Rodale was on a similar trajectory, prompting its sale to Hearst.

For Meredith, the deal for 94-year-old Time Inc. is a bet that getting larger will afford it the scale to increase its digital ad sales while bundling more of its titles together to increase circulation revenue. Acquiring Time's female-focused publications -- People as well as InStyle, Real Simple, Cooking Life and Southern Living -- promises to give Meredith more and deeper data to use to sell advertising.

Meredith, based in Des Moines, Iowa, also was said to have shown interest in Rodale.

"These are the companies that have been opportunistically buying up other magazine publishers because they know how to operate magazines more efficiently," said Reed Phillips III, managing partner at boutique media investment bank Oaklins DeSilva & Phillips LLC. "There are big synergistic opportunities in terms of cost-cutting and increasing profitability of Hearst and Meredith substantially."

Meredith CEO Steve Lacy, who is known as a frugal and focused manager, said in a conference call Monday with Wall Street analysts, that his company can better manage Time's titles by cutting editorial costs and expanding its breadth of advertisers.

Meredith's decision to go all-in on the magazine business comes two years after the company was nearly acquired by Media General Inc., an owner of local TV stations formerly based in Richmond, Va. But when Media General's shareholders viscerally complained that they didn't want to go into an already challenged magazine business, Nexstar Media Group Inc. (NXST) intervened to break up that deal, leaving Meredith alone on the altar.  

So, rather than a buyout for the Meredith family, whose company dates to 1902, the Iowa publisher has chosen instead to embrace scale, doubling down on content. On Monday's call, Lacy said Meredith will be able to remove more than $450 million in costs out of Time Inc. over the next two years, underscoring his view that there's still value in the magazine business.

"Meredith has highly developed marketing skills," Kreisky added. "They see in Time Inc a bunch of under-leveraged brands that they feel they can leverage by moving away from the traditional high-cost Time Inc. model and exercising the advantages of scale to lower costs even further."

There is talk that Meredith will continue to consolidate the sector and that the other two of the big three publishers also will look to acquisitions to continue to build scale. The Wenner family, through Wenner Media, also is looking to sell its remaining 51% stake in Rolling Stone magazine, with initial interest coming from Penske Media Corp., owner of Variety and Women's Wear Daily, among other media companies, according to a source close to the talks.

Earlier in the year, the New York Post reported that Rizvi Traverse Management LLC, the private equity firm that holds a majority stake in publisher Playboy Enterprises Inc. and took it private in 2011, had been actively seeking buyers or other investors. No reports have surfaced since.

The fuel for consolidation is the digital ad prowess of Facebook and Google. As much as Battista tried to grow ad sales, the more it became clear that the publisher in its current form was fighting a losing battle. 

In a dig at newer media companies, Lacy said Time's editorial operations remain the lifeblood of the company and are the reason that Meredith was borrowing from banks and the Koch Brothers to acquire arguably the most storied magazine publisher in U.S. history.

"The editorial functions, the creative activities are always sacred," Lacy said, "because that's where you generate the 25% of the revenue from circulation which we count on in good times and in bad. And unlike some of the newer digital players, we get paid for our content, which is what I like."

Editor's note: This article originally appeared on The Deal, our sister publication that offers sophisticated insight and analysis on all types of deals, from inception to integration. Click here for a free trial.

More from Mergers and Acquisitions

Dropbox Soars in Third-Straight Record-Setting Session

Dropbox Soars in Third-Straight Record-Setting Session

Decision on AT&T's Merger With Time Warner Marks a Monumental Week for M&A

Decision on AT&T's Merger With Time Warner Marks a Monumental Week for M&A

JPM's Head of North America M&A Wants to Super-Charge M&A and Hire More Women

JPM's Head of North America M&A Wants to Super-Charge M&A and Hire More Women

Listen: The AT&T Time Warner Ruling and Its Impact on M&A

Listen: The AT&T Time Warner Ruling and Its Impact on M&A

Jim Cramer Reflects on Amazon-Whole Foods One Year Later

Jim Cramer Reflects on Amazon-Whole Foods One Year Later