The Gilded Age of Condé Nast Is Over

covermop mop mop The Gilded Age of Condé Nast Is OverThree weeks after McKinsey & Company slipped its foot into the door of the emerald tower, Condé Nast staffers continue to ask what fresh hell they find themselves in.

“I saw Graydon in the cafeteria this week!” said one business-side insider, last Friday. “In all my years here, I’ve never seen him in my life there. He was behind me in the line at checkout with his little swipe card. He was milling around uncomfortably with the commoners.”

When our source first walked into the Frank Gehry–designed cafeteria at 4 Times Square, Mr. Carter was studying the options available at the stir-fry station. It wasn’t clear whether he actually sat down to eat lunch, but the sight of him put our source into a bit of a panic.

“That whole feeling of working here and it being cushy and other people loving it and being jealous? That’s kind of gone now,” said the source.

We’re still eight weeks away from McKinsey actually handing out down recommendations for whatever painful cuts they devise to help boost the publisher’s bottom line. But it’s clear, from interviews with Condé Nast employees—from editors to executives to editorial staffers to ad sales slaves—that the enchanting, mystical era of Condé Nast is pretty much over. Small perks—the mani-pedis for clients, the flower deliveries, the sodas in the fridge—disappeared a while ago. Some changes, such as the emergence of Vanity Fair editor and restaurateur Graydon Carter eyeing reasonably priced stir fry, are worrisome on a psychological level. A culture of paranoia has taken over. What all these things add up to is a hefty emotional toll on staffers: Is this what they signed up for?

Of course, it’s a terrible time industrywide. But somehow, the necessary belt-tightening seems to have changed the look and feel of Condé Nast even more than that of other publishers.

Some within the company, however, argue that Condé Nast is just the same as everyone else, and is weathering the storm the same, too.

“The way to put it is: Should we be more worried than anyone else?” said Condé Nast CEO Chuck Townsend in an interview with The Observer. “How worried are you? Do you know what I mean? Here we are sitting in this rotten economy that in duration and in depth has exceeded anything any of us have experienced in our lifetime, bar none, and it produces a very worrisome situation. It’s universal. I don’t see how Condé Nast is different than anyone else.

“To a certain extent, all discretionary expenses in this business climate have to be managed much closer to the vest,” continued Mr. Townsend, referring to all the perks that separated Condé Nast from a place like Hearst. “All discretionary expenses. Right? Why? Because we have to make ends meet. We’re no different than anybody else. If we have less revenue, then we have less to spend.”

As the company prepares for a retrenchment of sorts, it appears The New Yorker will be immune from the pain that other editors and publishers in the building are anticipating.

In many ways, Mr. Townsend is right: Condé Nast, the elite standout of publishing houses of yore, doesn’t look much different than anyone else. The receptionists—other than on the 11th floor, a.k.a. the executive floor—have been fired, the newspaper subscriptions are gone. But that’s the point: Isn’t Condé Nast supposed to be different?

And there’s more to come. McKinsey has a long list of people to talk to. So far, consultants have made their way through about a fourth of the list, talking first to circulation and manufacturing directors, one insider said.

Over the next few weeks, editors and publishers will meet McKinsey consultants to face probing and uncomfortable questions about how they justify, say, paying $10 a word for a certain writer.

The Observer has learned, however, that New Yorker editor David Remnick will be exempt from meeting with McKinsey, as will anyone from the editorial side of his magazine. Two well-placed sources said that Condé Nast’s chairman, Si Newhouse, reached out to Mr. Remnick shortly after the McKinsey announcement was made and told him not to worry about anything—the magazine would be just fine, and neither McKinsey nor company executives would be mucking with his editorial costs. (Mr. Remnick declined to comment, and Mr. Townsend said, “When Si and David speak at the lunch they have periodically, God knows what’s communicated between them.”)