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The Grid’s last edition is Thursday.

Upstart Toronto news magazine The Grid is shutting down, falling victim to an eroding advertising market that dashed its leadership's hopes of making the free weekly profitable.

The publication launched in 2011 as a successor of sorts to the now-defunct Eye Weekly and built a devoted following. But it is to publish the last of its 162 issues on Thursday after failing to deliver financially for Torstar Corp., its parent company, which also owns the Toronto Star and the free Metro daily newspapers.

The Grid's fate illustrates the struggles that established outlets and startup ventures alike are facing in generating enough revenue to sustain their journalism. Advertisers have spent less in print and pushed more of their marketing online, where prices are lower. Without more ad dollars, even introducing new revenue streams such as subscriber fees would not likely have pulled the magazine out of red ink.

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Ultimately, time ran out for The Grid amid a "perfect storm" of pressures on its ad prospects, said the magazine's publisher and editor-in-chief, Laas Turnbull.

"What happens is that media planners turn to the stuff they know, the stuff that has a history. And we're still a startup so we're still struggling to establish an audience, to establish a brand," Mr. Turnbull said in an interview. "We just didn't have a long enough window [of opportunity]."

Nevertheless, he believes it was "the responsible decision" to close the magazine now as "you can only sustain a certain level of losses for so long."

Over three years, The Grid drew in loyal readers by targeting Toronto's younger residents and families. Its print circulation rose to 70,000 copies per week, and internal research suggested each copy reached five readers, while the magazine's website drew an average of 400,000 unique online visitors each month – virtually all of them within the GTA. The Grid also won numerous accolades, including National Magazine Awards and Society of News Design prizes.

But it was never profitable.

Star Media Group president John Cruickshank maintains The Grid "didn't have a problem with audience" and said he is "terribly disappointed" to see it fold, but added Torstar expects its publications to have at least "a path to profitability."

"We spent three years and a significant amount of investment to create what was, I think, a wonderful editorial product," Mr. Cruickshank said in an interview. "We couldn't in the course of that time create enough appetite among advertisers to be able to continue to finance it. And we didn't want to do a degraded version."

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Revenues at the Star Media Group fell 6 per cent in 2013, due in large part to a continuing decline in print advertising, and with that trend expected to continue, cost cutting is a priority for Torstar in 2014.

The Grid has 22 staff, 12 of them in editorial. In an internal memo, Mr. Cruickshank confirmed that "most members of The Grid family will be leaving Star Media Group" as a result of the closure, and one source said some staff were given severance packages on Wednesday. In June of last year, the magazine had already laid off four editorial staff members in an effort to lower costs.

Even in defeat, Mr. Turnbull believes the Grid was a "highly differentiated" publication that could have survived – even thrived – had it launched five years sooner, in a more stable media climate.

"I really feel that we captured an element of the city and gave it voice," said Edward Keenan, senior editor at The Grid, "and I'm happy to have been a part of that."

With a report from David Hains


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October 1991: Eye Weekly launches its first issue, promising on the cover that the issue is sure to be a collector's item, "Worth big $$$$ in years to come!!!!" The magazine also contains an interview with former Blue Jay Cliff Johnson, so you know it's really old.

March 1994: Eye is an early adopter of the Information Superhighway, and first posts its content online through Usenet, a precursor of today's Internet message boards. Print media will never be the same.

October 1994: Characteristic of the magazine's cheeky early tone, founding editor William Burrill launches his write-in campaign for mayor. Among his campaign promises were to ban the use of the phrase "world class" to describe Toronto, a beer vending machine in every convenience store, and turning the downtown Gardiner Expressway into a giant roller coaster.

February 1999: Journalist Robert Fulford writes a Toronto Life piece about the city's free alt-weeklies and characterizes Eye's irreverent stance as desperate and confused. Eye's circulation is at 105,000 weekly copies.

March 2002: After a multiple page advertorial for a car show appears in the magazine without identifying itself as such, management clashes with editorial. Many senior staff members resign or are fired. Recently hired film editor Catharine Tunnacliffe becomes managing editor. During Ms. Tunnacliffe's tenure, the next four years see an increased focus on city issues, with former mayor John Sewell and current councillor Gord Perks contributing columns.

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2005: Alan Vernon becomes editorial director, a position he holds until Laas Turnbull replaces him in 2010. Among Mr. Vernon's controversial decisions were to accept tobacco advertising despite criticism and calls for a boycott of the magazine from political adviser Warren Kinsella in 2008, and devoting an entire issue to a Quentin Tarantino film in 2009. Mr. Turnbull is brought in to turn around the magazine with either a rebrand of Eye or the launch of a new magazine.

May 2011: Eye folds, and the magazine re-launches as The Grid with an almost entirely new editorial team. With a slick new design and the disappearance of back-page sex worker ads, the free weekly aims to capture "what's happening at street level" for an audience somewhere between alt-weekly Now and monthly general interest magazine Toronto Life.

June 2013: Four months after winning its second consecutive Society for News Design award for the world's best designed newspaper, the Grid cleans up at the National Magazine Awards, earning a leading seven awards. But the financial side of the business is not as healthy: One week later, the Grid lays off a quarter of its editorial staff, including its managing editor.

July 2014: With a circulation of 70,000, the Grid folds more than three years after its launch. The magazine printed 162 issues, countless food trend articles, voyeuristic dating reviews, and provided extensive coverage of of Rob Ford.

David Hains

Editor's note: An earlier online version of this article incorrectly stated that all staff members resigned or were fired in 2002. This version has been corrected.

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