updated 4/27/2009 4:58:45 PM ET 2009-04-27T20:58:45

The business magazine Portfolio is closing down and laying off more than 80 people, just two years after launching with $100 million in backing and visions of becoming a high-end rival to the likes of Fortune, Forbes and BusinessWeek.

Conde Nast Publications Inc., the upscale magazine giant run by billionaire S.I. Newhouse Jr., said Monday that it would close Portfolio and Portfolio.com because of the ad downturn. The May issue, on newsstands now, will be Portfolio's last.

Portfolio began in May 2007 with a $100 million bankroll meant to last several years. Conde Nast is known for having lots of patience with unprofitable magazines. But the company said the ad downturn pushed the prospects for Portfolio's profitability too far into the future.

"Our timing proved to be terrible in terms of building a big ad franchise from scratch," said David Carey, a group president at Conde Nast.

Carey said the company was satisfied with Portfolio's circulation of about 450,000, and he said demand for business journalism remained strong. But he predicted that advertising would not recover quickly even after the economy improves.

"We saw where we are and where we want to be in 18 months," he said. "The gap between those two points was becoming bigger."

The editor-in-chief, Joanne Lipman, and Portfolio's publisher, William Li, are among the people laid off, said Conde Nast spokeswoman Maurie Perl. She declined to say whether Portfolio employees would receive severance but said a few people may find jobs at other publications run by the company.

Conde Nast, which also publishes such magazines as Vogue, The New Yorker and Wired, is a unit of privately held Advance Publications Inc. Two months ago the publisher closed lifestyle magazine Domino.

Advance also owns more than 30 newspapers, including The Star-Ledger in Newark, New Jersey; The Plain Dealer in Cleveland and The Times-Picayune in New Orleans. Advance's newspapers also have been slashing costs, taking such measures as cutting pay, imposing unpaid days off or reducing publication days. In November, Advance closed its Newhouse News Service, which had 24 employees.

In this grim economic atmosphere, analysts said, a magazine like Portfolio was untenable for Conde Nast.

"It's a luxury they could no longer afford," said Martin Walker, chairman of Walker Communications, a magazine consulting firm.

University of Mississippi journalism professor Samir Husni noted that Portfolio subscriptions cost just $12 for 12 issues, which put a very high reliance on advertising. That model has come under pressure across the publishing industry in part because so much content is available for free on the Internet, where advertising rates are generally lower.

While established magazines like Fortune or Forbes will likely survive the downturn, Husni said, more broadly "the publishing model that has existed since World War II is dead."

Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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