Where Publishers Are Thriving

Where Publishers Are Thriving
Germany's papers are doing fine despite the ad flight to the Web. What's their secret?
by Jack Ewing
http://www.businessweek.com/magazine/content/08_34/b4097094901129.htm
Here's a scene you don't see at many U.S. papers these days. The publisher settles into his office sofa, glances over his shoulder at the bustling metropolis below, and says casually: "We're doing good!"
True, there are definitely some aspects of the business model at Bild, a Berlin daily with 12 million readers, that might not fly in the U.S. (the photos of nude women on page 1, for example). Still, it's worth asking publisher Kai Diekmann how, when U.S. newspaper revenue is going off a cliff, Europe's largest paper managed to have its most profitable year ever in 2007.

It's not as if Bild hasn't been hit by the same problems as U.S. papers, including advertisers lost to the Web. So it's tempting to credit Bild's double-digit profit margin solely to sensationalism. The day I met Diekmann, Bild's lead story concerned managers of public health-insurance funds helping themselves to free Viagra. One of the top online stories asked: "Which female celebrity has the nicest breasts?"

But Germany's prestige papers are doing reasonably well, too. National-affairs daily Die Welt, a chronic money-loser that, like Bild, is part of the Axel Springer empire, made the first profit in its 60-year history last year. "I wouldn't say we don't have challenges, but we are not nearly as hard-hit by the advertising crisis as the U.S.," says publisher Peter Wurtenberger.

PRE-WEB MAKEOVER
Even accounting for the quirks of the local market, Bild and other German papers are doing something right. For an American print guy like me, it was a bracing experience to visit a newsroom where the journalists don't look like they're ready to jump out the window. The lesson seems to be that there are ways for papers to survive the shift to digital if they're willing to take risks.

Germany's newspaper industry had its own existential crisis in 2001 when that country's economy tanked. Ad revenue slumped, and papers did all the painful things their U.S. counterparts are doing now, such as cutting staff and getting used to new owners. In retrospect, the crisis had its upside.

It forced German papers to take a hard look at their businesses before the Web started to hurt big time. Staunchly gray Frankfurter Allgemeine Zeitung risked alienating readers by printing color photos on the front page and launched a sassy Sunday edition. The measures helped stop a slide in readership. Die Welt created a tabloid edition that helped lure younger readers. And the papers dared to raise prices. Even Bild, aimed at a working-class audience, in July boosted its newsstand price by 20%, to about 90 cents in most markets. The hikes, along with digital revenue, helped offset the loss in ads.

German papers also took advantage of how slowly Europeans embraced the Web, which gave editors a chance to learn from U.S. mistakes. Bild used a partnership with Deutsche Telekom, Germany's biggest Internet provider, to gain a foothold online at minimal cost. Now most of Bild's Web readers go straight to the site rather than via a search engine or portal. Diekmann says YouTube is sufficiently impressed to mull working together.

I'm impressed by the way Bild is staking out the mobile Web. Via a partnership with Vodafone Group , Bild became a mobile-phone provider, selling prepaid airtime at the same newsstands that sell the paper. Bild Mobile gives customers unlimited surfing and downloads as long as they stay tuned to bild.de. That's a compelling way to keep users glued to your site, and it has made Bild Germany's No. 1 mobile Web news destination.

I suspect the real reason German papers still thrive is their embrace of competition. Unlike so many U.S. papers, Bild was never part of a quasi-monopoly that allowed complacency. It's telling that Bild doesn't deliver -it depends on newsstand sales. "Bild has to prove itself at the kiosk every day," says Deputy Editor-in-Chief Michael Paustian.

That pressure helped Bild maintain its focus on original content. It uses almost no wire copy and brags that every story is an exclusive. Even during the crisis years, Bild kept its 800-strong editorial staff intact. What advice does Diekmann have for American newspapers? "It's too late."

Op-Ed: Outsourcing Circulation Management-A Vital Industry Service

BoSacks Speaks Out: Last week I had the flip side of this story. Now it is your turn to decide on the merits of each business philosophy.

I don't think necessity is the mother of invention - invention, in my opinion, arises directly from idleness, possibly also from laziness. To save oneself trouble.
Agatha Christie (1890 - 1976), An Autobiography, 1977


Op-Ed: Outsourcing Circulation Management-A Vital Industry Service
By Greg Wolfe
http://www.circman.com/viewmedia.asp?prmMID=4097&prmID=1


[Ed. note: In CM's continued coverage of an emerging trend of outsourcing turnkey circ operations, we've heard from the publisher's perspective on keeping functions in-house. Now, we hear from the vendor perspective, addressing signs within the industry that are pointing toward, at the very least, a re-examination of the in-house circulation process.]

Outsourcing circulation is an activity that has, in some form or other, been successfully practiced for many years. The industry, for example, has always leaned heavily on circulation consultants for advice as well as selected services. Now, there are numerous circulation consultants working in the industry. It was from this consulting base that a more advanced form of outsourcing-full service circulation management-developed over the last two decades. Today full service circulation management has joined the established lexicon (fulfillment, list brokerage, newsstand/national distributor) of industry outsource service providers.

It's a business that is built, and sustained, on the principle that circulation can be more efficiently managed working for many publishers simultaneously (on a relatively larger number of publications) on an outsourced basis, than by in-house staff working on a relatively small number of titles. Outsourcing circulation is beneficial primarily because it offers publishers the compelling advantage of access to an experienced circulation staff, broad based purchasing scale and, for some publishers, the prospect of reducing overhead expense. Furthermore it includes a management process, refined over time, that allows for careful attention to the strategic aspects of circulation.

Despite its many advantages circulation outsourcing, until recently, has been a relatively slow growing business with shallow market penetration. For instance the number of small/medium sized publishers (the prime candidates for outsourcing) is substantial, but only lightly penetrated by circulation outsource providers. In the ABC/BPA audited category there are 205 publishing companies (with less than 1 million paid/verified circ), publishing 260 titles, accounting for 40 million paid/verified circulation. It's estimated that there are nearly twice as many small/medium sized publishers of unaudited titles. Currently only a small percent (estimated to be less than 8 percent) of these publications are being serviced by outsourcing circulation management companies.

If the benefits are so great why hasn't circulation outsourcing grown more decisively?

The reason is partially rooted in the culture of the publishing business. A core belief is circulation is central to the publishing process-the so-called third leg on the publishing stool. It has often been deemed so critical that it couldn't be outsourced. Others have indicated that outsourcing represents bad short-term thinking. But make no mistake about this-circulation remains mission critical for publishers (arguably it's never been more important). However, a revision in industry thinking is emerging in regard to how best to maximize circulation performance. There have been a number of market changes which have precipitated this modified thought process. The magazine industry, as we all know, has been adversely affected by the massive Internet-imposed changes in the media landscape. The publishing industry is experiencing reduced advertising and circulation revenue and profitability. Furthermore publishers have discovered, to their detriment, that it's becoming much more difficult to hire and retain experienced circulators. These changing market circumstances have forced publishers to think differently (more creatively) about the entire publishing process.

All of this, of course, is effecting how publishers view the process of circulation. Although circulation is still considered mission critical, many publishers are now searching for alternative methods, including outsourcing circulation management. Recently IDG and Ziff Davis outsourced their circulation. The decisions by those publishers, both with more than 1 million paid/verified circulation, are, to date the strongest indicators that outsourcing circulation management is now being considered as an important alternative, even for publishing companies with relatively large circ levels. Other publishing companies are coming to the same realization that circ outsourcing is a good strategic alternative for protecting and enhancing circulation integrity and profitability.

The concept of circulation management outsourcing has been rigorously tested, and improved, over the last two decades. It's now a strong alternative for small/medium sized publishers to consider for enhancing circulation performance and cutting expense. It's ironic, but as the publishing industry struggles with the difficulties posed by altered market conditions it's expected the circulation outsourcing business will dramatically expand. Circulation management outsourcing has come of age as a vital industry service.

Greg Wolfe is President of Circulation Specialists, Inc., a Connecticut based circulation outsource company.

ABC Board Cuts Audit Costs for Newspapers, Freezes Rates for Magazines

ABC Board Cuts Audit Costs for Newspapers, Freezes Rates for Magazines
Magazines may also see audit rate reductions as early as November.
By Chandra Johnson-Greene
http://www.circman.com/viewmedia.asp?prmMID=4090&prmID=1
In response to the newspaper industry's ongoing revenue struggle, ABC announced that it will reduce audit costs by almost half for some U.S. and Canadian newspapers, while freezing costs for other newspapers and most magazines.

ABC previously announced in March that U.S. newspapers with paid circulation below 50,000 would have the option to be audited every other year beginning in April 2009, raising the eligibility ceiling from its current 25,000 level. This week, the ABC board agreed to advance this timeline by six months, to Oct. 1, 2008, and expand the option to Canadian newspapers.

The board also gave its initial approval to rules allowing all U.S. and Canadian newspapers with paid circulation between 50,000-75,000 to have this same biannual audit option next year, beginning April 1. To take advantage of this, a newspaper's most recent audit cannot contain an adjustment of more than 2 percent and its third-party circulation cannot exceed 5 percent of its total paid circulation.

Newspapers with circulation between 50,000-75,000 will also be required to participate in ABC's Preprint Projection Center, a free online tool that allows publishers to provide confidential circulation forecasts to help advertisers better plan media purchases and insert-printing requirements. All newspapers are still required to file six-month publisher's statements, with top-line numbers reported in ABC's FAS-FAX report.

The ABC board also approved a new flat-rate billing model for field audit services for fiscal 2009, effectively freezing audit costs for most other ABC newspapers and magazines.

"ABC has typically billed publishers based on an hourly rate," said Michael J. Lavery, ABC's president and managing director, in a statement. "Our new structure uses a flat rate based on the most recent ABC audit. By streamlining some aspects of the audit and automating more processes, most publications will be able to accurately forecast and control their costs."

According to Teresa Perry, SVP, publisher member audit and report processing services, ABC, titles that have "too much versatility" during their auditing periods will be continued to be billed at the hourly rate. The bulk of those titles would be found in the non-paid category, she told CM.

Audit Rate Reductions for Magazines Too?

While the forecast for the magazine industry doesn't appear to be as bleak as it is for newspapers, will the board consider reducing costs for them as well? According to Perry, the answer is yes.

"The liaison committees, which are so frequently developing ideas [to address the concerns of the magazine industry], have been reviewing options for some time now," Perry told CM. "They've been taking a look at what reporting elements are important and are required by the advertising environment, as well as which ones are aged or no longer relevant. All of this is being reviewed on a cost-benefit ratio."

Perry says that such reviews have been taking place for the past four months and that changes could be seen as early as November, but most likely in early 2009.

Other Board Actions

The ABC board also agreed to allow consumer magazines to test new circulation marketing programs while working with ABC to determine the appropriate audit procedures. Circulation generated during the one-year test period would be reported as verified or analyzed non-paid, as appropriate.

"We trying to encourage publishers not to shut the door on new marketing opportunities just because the audit process is unknown upfront," says Perry. "Traditional sources, such as direct mail, may not be as available, so it's wise to explore non-traditional sources and to partner with others they may not have the audit structure."

The board also voted to adopt a new multimedia publisher's statement for business magazines. The new optional report, available for the Dec. 2008 reporting period, allows publishers to report print circulation, Web site activity, e-newsletter activity and pass-along receivership in a single ABC statement. The board also agreed that, effective immediately, paid Web site subscriptions could qualify as paid digital editions of business magazines.

The board elected five new directors at its recent meeting, which took place on July 23-26: Irene Grieco, manager of media investment and strategic partnerships at Unilever US; Suzanne Silber, group director of strategy at OMD; Bill Stabile, senior director of brand and marketing communications at Siemens Corp.; Lindsay Valk, senior vice president of analysis and planning, consumer marketing, Hearst Magazines; and Brenda White, senior vice president, Starcom Worldwide.

Digital Editions' Growth Spurt

Digital Editions' Growth Spurt
E-editions are gaining ground in the mainstream market.
By Gretchen A. Peck
http://www.pubexec.com/story/story.bsp?sid=110154&var=story

This spring, Barnes & Noble announced that it would offer both print publications and digital editions of more than 1,000 magazine titles to visitors of BN.com. The e-editions will be fulfilled by Barnes & Noble partner Zinio. Indeed, it's just one more indication that, despite some debate on their future, digital editions are becoming a viable alternative to print for a growing number of readers.

Cambridge, Mass.-based The Gilbane Group recently published a study, "Digital Magazine and Newspaper Editions: Growth, Trends, and Best Practices," showing that the number of business-to-business publications offering digital editions increased by more than 300 percent in a two-year span (2005 to 2007), and the number of consumer publications offering digital editions has increased by more than 200 percent.

For publishers, clear economic and environmental benefits exist: Digital editions don't kill trees, and the cost to produce a digital edition is much less than a printed publication.

Beyond the environmental and economic considerations, many publishers also have found digital editions to be an effective medium for enhancing the editorial and advertising experience with the use of rich media.

Today, even businesses that have for generations been dedicated to printing publications are looking at digital distribution as a new way to serve publishing clients. For example, Brown Printing Co.-one of the nation's largest magazine printers-announced that it would assist publishers with their digital publications by partnering with iMirus Digital Solutions, the e-edition division owned by parent company Riggs Heinrich Media Inc. Many other printers are now offering digital-publication services to their publishers as well.

Digital editions also can be an effective way for publishers to expand into new markets, and increase their circulations without the additional printing and mailing costs.

It was the opportunity to launch a new global title that prompted the publisher of Recycling Today to venture into e-editions. The global edition of the magazine debuted in April exclusively as an e-edition, with the help of Advanced Publishing Corp.

"We are extending an existing North American title into a global market position," explains James R. Keefe, executive vice president and group publisher, GIE Media, which publishes Recycling Today. "The launch of the new product, which is different from a content perspective, was easier to achieve in an electronic format, as delivery to a reader base around the world is more reliable and immediate. Therefore, the distribution issue becomes much easier to solve. As well, the platform we selected allows a lot of powerful multimedia and interactive applications."

The monthly, controlled-circulation title already has 30,000 subscribers, but with reader feedback already very positive, Keefe expects continued circulation growth.

Digital editions are also proving to be a valuable strategy for publishers looking to breathe new life into previously published issues. For example, Wenner Media contracted Bondi Digital Publishing to convert Rolling Stone's entire printed history into digital format and republish it as a searchable DVD, "Rolling Stone Cover-to-Cover: The First 40 Years."

Whether the mass market will adopt digital editions as their preferred format for reading magazines in the future remains to be seen-and debated by industry pundits. But with recent triple-digit growth rates and one of the nation's largest magazine retailers giving space to e-editions on its Web site, the future certainly seems promising for the digital magazine.

Solutions on the Market
As the number of publishers providing digital editions of their publications has grown, so has the number of digital editions solutions providers. Today, publishers have their choice of a wide range of products and services to fit their and their readers' expectations for a digital publication. Here are a number of today's top solutions on the market. Many printers of all sizes-such as Publishers Press, RR Donnelley and Sheridan Magazine Services-also now offer solutions to help publishers provide digital editions of their publications (but are not listed here). Many of these solutions are available to non-customers, so they may be worth investigating in your search for the best solution for your needs.

Advanced Publishing Corp.
Solution/Service: RIDE (Rich Interactive Digital Edition) is designed to enable publishers to create digital publications based on Microsoft's award-winning Silverlight platform. Publications are fully searchable and may be complemented with rich media features. A secure subscription system is provided. Publishers also have access to real-time reports on pages viewed, time spent, click-thrus and more. Advanced Publishing digital-edition service includes conversion, hosting, subscriber access management, customized registration and data capture, e-mail notification delivery, BPA/ABC audit assistance, cross-publication search, archive issues access, and added capabilities for online ads, sponsorships, online video and more.
Pricing: All-inclusive, consisting of a one-time setup fee and a per-page fee based on the number of magazines and the overall volume of pages. For paid consumer magazines, it may also include a per-subscriber fee for each issue.
Magazine customers include: Composites Manufacturing; International Figure Skating; Vertical Magazine; GIE Media Inc.; Western Design & Interiors; Madavor Media LLC
Contact: (866) 785-4400, AdvancedPublishing.com

alQemy
Solution/Service: alQemy is an Adobe Partner that pioneered the first interactive PDF magazine and catalog format with the launch of Magazooms. Today, all digital editions are built in Adobe Flash format, transformed using the company's Internet-based Flash application and hosted on alQemy servers. Publishers also can present their e-editions, including archives, on their own Web sites via customizable portals, and have access to content feeds to supply their Web sites and RSS feeds with articles from their Magazooms publications. Magazooms offers a "Search and Save" feature, which enables users to conduct global cross-issue searches and save resulting pages to the desktop as a new, customized PDF. AlQemy has announced plans to offer special Magazooms versions for the Apple iPhone.
Pricing: Available as a Free Basic Service, which includes conversion and hosting to qualified publishers (some restrictions apply), or a Full Feature Service, based on cost-per-page with enhanced options such as video insertions, custom hyperlinks, reader graphs and analytics with reader maps, customizable Web portals, shopping-enabled pages and an integrated Shopping Cart.
Magazine customers include: Electronic Retailer; Online Strategies; Dog Fancy; Freshwater and Marine Aquarium; Texas RV Park and Travel Guide
Contact: (864) 284-9918, Magazooms.com

BlueToad Inc.
Solution/Service: BlueToad's page-flip technology is designed to enable publishers to create and deploy an enhanced online version of print publications. Publishers can upload and convert print files to create a one-of-a-kind online publication with streaming audio and video, and as many as 20 direct Web links per page. Publishers can put a publication on BlueToad's Web site, or distribute it from their own sites with a BlueToad Icon and a self-contained, online viewing system.
Pricing: No fees for setup, and no contracts required. Pricing is based on a per-page fee, which may be as little as $2.
Magazine customers include: Not available for publication.
Contact: (407) 992-8744, BlueToad.com/publisher

Bondi Digital Publishing
Solution/Service: Bondi Digital Publishing designs, creates and publishes complete print-magazine-archive box sets in searchable digital editions.
Pricing: Not provided.
Magazine customers include: The New Yorker; Playboy Enterprises; Wenner Media
Contact: (212) 405-1655, BondiDigital.com

Content Data Solutions, a div. of Thomas Publishing Co.
Solution/Service: Content DSI converts print-ready publication files into digital replicas that are searchable by keyword or full text, and can include live links, and statistical reporting on editorial content and advertising. Content Data Solutions can also host digital publications on the publisher's behalf.
Pricing: Not provided.
Magazine customers include: Not available for publication.
Contact: (800) 872-2828, ContentDSI.com

DMC Inc.
Solution/Service: EditionDuo enables publishers to create digital replicas of print publications, enhanced with rich media, and stored and hosted by DMG. Publishers can present the publications on their Web sites; animated GIFs can be sent to subscribers via e-mail; or publishers can distribute a Flash file of the e-edition via removable media. Accessed via standard Web browsers. Among EditionDuo's features: simple text feeds (an Article Link will open a text version of the article in a new window); article translation; link building through bookmark sites such as Digg, del.icio.us, Google and more; article commenting; and an Adverts Menu, which acts as a table of contents for all of the publication's advertising features. Links can direct readers to advertisers' specific Web landing pages. Reader activity is tracked and reported.
Pricing: $229 setup fee plus $3 per-page fee. $0.50 per page for removing all EditionDuo branding (optional). Additional charges include $35 for an animated GIF, and $95 for a compiled Flash file.
Magazine customers include: Golf Georgia; Grape Anticipation; I Do for Brides; Clemson University; Designs Direct Publishing
Contact: (770) 992-5078, EditionDuo.com

Dirxion
Solution/Service: Dirxion's solution replicates printed publications, and supports restricted or open access. Standard features include: database-driven searches (by keyword, phrase and category); banner ad space; hot links to Web sites and e-mail addresses; customized table of contents; "sticky" notes; cross-reference links; Flash ads; audio/video linking; usage tracking and reporting; and support for multiple languages.
Pricing: Not provided.
Magazine customers include: PennWell; Harrison Group
Contact: (888) 391-0202, Dirxion.com

E-Book Systems Inc.
Solution/Service: E-Book Systems' FlipBook Publishing System's Digital Flip technology is designed to replicate the page-flipping experience. With FlipBook Creator, a Wizard-based program, online magazines can be enhanced with video, animations, music, embedded links and search functions.
Pricing: Not provided.
Magazine customers include: FHM; Primedia; MediaCorp
Contact: (408) 625-8000, FlipViewer.com

iMirus, a div. of Riggs Heinrich Media Inc.
Solution/Service: iMirus enables publishers to create digital editions-online or downloadable-of their print titles. The iMirus Reader may be customized to match the publisher's branding and deployed via the publisher's site (no software download is required), or served up as a client application for readers who wish to download a publication "to go." iMirus also provides advertising and marketing programs, including banner ads, sponsorship programs, custom-published content, and sales of the outside front cover of the e-edition.
Pricing: iMirus operates as a "software as a service" model. Pricing is based on a package, which includes all services, or a la carte, which start at as low as $600 (including hosting).
Magazine customers include: Business Traveler; NWA World Traveler; Dental Economics; Rhode Island Monthly; Giant
Contact: (918) 492-0660, Imirus.com

NewsStand Corp.
Solution/Service: NewsStand takes a consultative approach to developing solutions for publishers of magazines, books, newspapers and more. NewsStand's services and solutions include archiving, content management and repurposing, electronic editions, subscriber management and custom publishing. In addition to its public-facing NewsStand.com site, the company also works with b-to-b and corporate publishers to develop e-editions and Intranet-based content portals, enabling more robust advertiser-publisher programs.
Pricing: NewsStand.com's e-editions are created based on flat fees dependent upon circulation. For pricing of other services, contact NewsStand.
Magazine customers include: Barron's; Harvard Business Review; Laptop Magazine; Flight International; Nature Publishing
Contact: (866) 837-4567, NewsStand.com

Nxtbook Media
Solution/Service: Nxtbook Media's e-edition solution features include: bookmarks and page notation; word searches (current issue and archival); "forward content to a friend" capabilities; hyperlinks and e-mail links; and permalinks. The e-edition may be enriched with toolbar ads and sponsorship programs; Flash ads; audio and video ads; gatefolds, bellybands and inserts; and Gravicon surveys. Reader behavior is also tracked.
Pricing: Not provided.
Magazine customers include: Advanstar Communications; Reed Business Information; Weaver Official Publications; EContent Magazine; Primedia
Contact: (866) 268-1219, NXTBookmedia.com

Olive Software
Solution/Service: Olive Software is designed to create exact print replicas, through a centralized data-storage system and a single workflow, and to enable publishers to use the software to produce and host the digital edition-or, via its outsourced model, have Olive produce and host the title.
Pricing: Not provided.
Magazine customers include: Time Inc.; ESPN; Reed Business Information; Hearst Business Media; Newport
Communications
Contact: (866) 654-8387, OliveSoftware.com

PageSuite Ltd.
Solution/Service: PageSuite is an online, interactive, page-turning software application that enables publications to be presented in a digital edition deployed via the Internet.
Pricing: From $500; depends on page count and frequency.
Magazine customers include: Condé Nast; Cambridge Style; City Living; Working Mother; Clarity Media Group
Contact: Info@PageSuite.co.uk, PageSuite.co.uk

Pressmart Media Ltd.
Solution/Service: Pressmart converts publishers' digital prepress pages into digital editions, using a patent-pending technology, and delivers them via the Web, mobile, podcasts, RSS feeds, social networks and content-aggregation services. Publications are promoted to subscribers via Pressmart.net, as well as by online advertising, new-edition notifications, news alerts and e-mail campaigns. E-editions are pre-
integrated with social-networking sites and content-
aggregation services, and are search-engine ready.
Pricing: Not provided. No upfront investment; fees based on a per-page rate.
Magazine customers include: Not available for publication.
Contact: (212) 351-5090, Pressmart.net/eedition.html

Qiosk.com
Solution/Service: Qmags' electronic issues, delivered via the Internet, can be exact copies of the printed magazines, or digital publications created with the QuVu format, which enables the publication to fit readers' computer screens, requiring no page manipulation. E-magazines can be enhanced with audio and video, hyperlinks and electronic search capabilities.
Pricing: Not provided.
Magazine customers include: Animation Magazine; Armchair General Magazine; Computer Magazine; IEEE Security & Privacy; Waste Management World
Contact: (212) 947-6050, ext. 11, Qmags.com

Texterity
Solution/Service: Texterity converts publishers' titles into the Published Web Format (PWF) from PDF files. PWF replicates page-turning, and enables cover wraps, bellybands, etc., to be transformed into overlays, pop-ups or animation. Buyers' response cards appear as blow-ins (layered on the publication), and direct readers to specific advertiser locations. Texterity's Lead Management System enables publishers and advertisers to offer premium content, such as white papers, within the digital edition, prompting readers to opt-in. PWF reader reports may also be used for BPA and ABC circulation statements.
Pricing: Not provided. Costs include a per-page conversion fee; a monthly maintenance fee for document hosting with customer-branded URL, search engine visibility, archive issues, and availability across all platforms without a plug-in or application (Windows PC, Macintosh, and iPod Touch or iPhone), among others; and a delivery fee. Other services also are available.
Magazine customers include: Make Magazine; Game Developer; Internal Auditor
Contact: (508) 804-3000, Texterity.com

YUDU Media
Solution/Service: YUDU Publishing Pro features include video, audio and Flash file insertion; a digital rights management system; contextual and archival search; bookmarking and notations; advertising components, such as tabs, gatefolds and bellybands; statistics capture; and more. It offers crisp vector text (which eliminates pixelation) and infinite zoom.
Pricing: Not provided.
Magazine customers include: Not available for publication.
Contact: (888) FOR-YUDU, Yudu.com

Zendition
Solution/Service: Zendition's a base model application is designed to enable page flipping, print capabilities, search functions, zoom, table of contents and more. Add-on modules include audio, video, pop-ups, back-end integration, BPA auditing, and registration and user tracking.
Pricing: Not provided.
Magazine customers include: Strategy & Business; Relix; Global Rhythm; Trader Monthly; Corporate Leader
Contact: (646) 278-0621, Zendition.com

Zinio LLC
Solution/Service: Zinio's Publisher Growth Services Group collaborates with publishes to help integrate and tailor online marketing programs to a publisher's circulation, ad sales, brand extension or other audience-building goals.
Pricing: Not provided.
Magazine customers include: Primedia; Reader's Digest; VNU (now Nielsen); Disney; The Hearst Corp.; Rodale; National Geographic; TV Guide
Contact: Zinio.com/publishers

Zmags Inc.
Solution/Service: Zmags Publicator is designed for creating and editing electronic versions of print publications. It is designed to enable creation of e-editions in as few as five minutes, on average. The solution is Web-based, requiring no software downloads. Available in two levels-PublicatorExpress and PublicatorPro. PublicatorPro also features advanced editing; archives management; high-resolution zooming; advanced analytics; and automatic linking to internal and external sources.
Pricing: Starting at $45/month per publication.
Magazine customers include: Not available for publication.
Contact: (613) 627-4101, Zmags.com PE

Gretchen A. Peck is a freelance author who writes about the international printing and publishing industries.

Are Free Magazines the Future of Publishing?

Are Free Magazines the Future of Publishing?
Will consumer go controlled?
By Chandra Johnson-Greene
http://www.foliomag.com/2008/are-free-magazines-future-publishing
CHICAGO-During a session at this week's CM Show, Jennifer Armor, audit manager at Verified Audit Circulation, argued that free magazines are the future of the business.

She riffed off a quote from Wired editor-in-chief Chris Anderson: "From the consumer's perspective there is a huge difference between cheap and free. Give a product away and it can go viral. Charge a single cent for it and you're already in an entirely different business."

Armour thinks this idea can, and will, eventually extend to the magazine industry. (Broadcast radio and TV have been offering it since their inception, after all, and the music industry is moving in the same direction, she noted.)

Because of the increasing price of paper and postage, Armour said, the cost of acquiring and keeping paid circ is becoming too high compared to the revenue it generates, and therefore, consumer publications will eventually move to a controlled circ model. Only magazines with premium content that can't be found elsewhere will be able charge their readers.

True, other types of media are free or becoming free, and it is becoming quite expensive to run a paid title. But the idea that consumer magazines will be corralled into a free model due to spiraling costs is unlikely.

Advertisers are still grappling with accepting that public-place copies of paid titles are valuable because the publishing industry's audience measurement system isn't as finite as TV or radio. To them, there's no real way to measure how many eyes have viewed the copies. Circulators know differently, of course, but the debate rages on. And until that issue-and a few others-have been hashed out, Armour's view of the future is out of reach.

----------------------------------------------------

Maghound offers magazines a la carte
By Lauren Bell
http://www.dmnews.com/Maghound-offers-magazines-a-la-carte/article/111962/

Time Inc. will launch Maghound.com
- a membership-based magazine purchasing site - in September.

Maghound users pay a monthly members' fee, depending on the number of titles they would like to receive. The program currently has 280 titles from a variety of publishers, and members can order different titles every month.

"The goal, simply, is to expand print circulation, and we feel, based on testing, that we can bring incremental readers to each brand," said Dave Ventresca, president of Maghound Enterprises Inc. "In addition, Maghound can bring in the right types of readers; we feel confident that it will deliver younger readers, who are more likely to be married, more likely to have children, have higher levels of education and higher household income levels than the general US population."

Though Maghound is a Time Inc. venture, other publishers have been invited to join the service, with the rationale that more choice makes more loyal consumers. Time titles will, however, benefit from merchandising and special promotions on the site - as will other high-performing titles. Ventresca said he expects to have 300 magazines signed up for Maghound by the end of September and 400 by the end of the year.

Marketing for the September Maghounds launch will be largely through online channels, such as banners and e-mails. Once the brand gets better established, marketing efforts will expand to print, events, search, viral and gift programs. Time Inc. lists and outside lists are being used to target direct efforts.

"The key metrics that we're looking at are: costs per acquiring new members, how many magazines people are buying, how much they're paying and how long they're going to stay with the service," said Ventresca. "We think people will stay Maghound readers longer because if you are subscribing to three titles [in the traditional way] and get bored with title C, you just cancel or let it lapse. If you're paying for three titles on Maghound and get bored of the third one, you're more likely to switch to another title since you're already paying for three."

Three titles from Maghound cost $3.95 a month, five titles $7.95, and seven are $9.95. For more than seven titles, members pay an additional dollar per title. Around 10% of the titles on Maghound have been designated "premium," based on their higher-than-average subscription pricing; premium titles charge an extra fee.

Magazines purchased through Maghound will be classified as single-copy sales in ABC and BPA audits.

Striving for Zero Returns on the Newsstand

Master Manufacturer:
Striving for Zero Returns on the Newsstand

By Steven W. Frye
Publishing Executive Magazine
http://www.pubexec.com/story/story.bsp?sid=107631&var=story

In today's electronic age, it's becoming harder and harder to justify our magazine business model anymore. We can longer claim that we are a cheap source of dispensing information.

We cut down trees, transport them to be ground into pulp, use energy and water to create paper, transport the stock to printing plants, print with inks (which go through a similar process in a petroleum-based market), mail magazines in an increasingly more expensive "snail mail" system, and/or ship them in a series of delivery trucks to every newsstand in America.

These magazines have a self-imposed average expiration date of 30 days (with the month of "relevance" printed right there on the cover), and thereafter are destroyed. We then rate their success on how many we sell, which currently averages around only 30 percent to 35 percent.

This is a huge waste of resources. And it always bothers me that once the next issue comes out, the current one is perceived as worthless. In most cases, however, that editorial and advertising is still relevant and has value. With sold copies it's called "pass-along" readership. Yet, unsold copies are deemed worthless and destroyed.

China's Model
It's different in China though. They have zero returns on newsstands. That's right-zero returns. Almost every magazine placed on the newsstands in China has a 100-percent sell-through. So if they can do it, can we?

There are obvious differences between our two systems, one being China's censorship of all media, but mainly, they do not have national distribution of any kind. Also, readers have a much smaller choice of publications than we do, but more importantly, they perceive magazines as a luxury item-not a cheap source of information.

Historically, many U.S. magazine publishers have thought they needed to keep the cover price as low as possible, believing that with every increase, they lost a proportional amount of subscribers.

But this conventional wisdom, like so many parts of our business model, doesn't seem to be working anymore. When I look around, the most successful magazines seem to be breaking all the rules.

While, with every postal and paper increase, many magazines got smaller with lighter paper, others grew in size and used very heavy stock. While some fretted over the inefficiencies of the postal, newsstand and advertising sales systems, as well as required auditing, others are distributing small, unaudited, but highly targeted, quantities and have no trouble selling ads.

So, I ask: Do we need to continue further wasting resources with our current newsstand distribution system or can we, too, sell nearly 100 percent of our newsstand copies?

How do the Chinese sell every magazine placed on their racks? It is simple, really. When the January issue (for example) expires and the February issue comes out, any unsold January copies are discounted in price. If, by chance, there are still January copies in March, they are further reduced until every copy is gone.

The Chinese understand that even though the issue is one day, one week or even one month old, it still has value. Magazines are a luxury item in China and are sold as such. Maybe it's time we think of magazines as a luxury item, too.

The Industry's Shift
If you think about it, our related industries may already be moving us toward that model by demanding high material costs. The paper mills shut plants and equipment to create a supply shortage with premium prices. Ink, packaging materials and energy are all on the rise.

Those titles that are successfully breaking the rules get it. They understand that their readers will pay $15 or more per issue, and advertisers are clamoring to get in. They make their book different, valuable and desirable.

Printed magazines cannot compete with cheap electronic media. We have become a luxury item whether we like it or not, and I suggest we grasp that concept and start remarketing ourselves as such. I believe our readers already see us as luxury item, or they wouldn't have bought the magazine in the first place. Our readers also use the Internet, yet they purchased our printed product for whatever reason . . . other than a source of timely information.

It's common knowledge that publishers lose money with every issue they place on the newsstand. And now newsstand racks are shrinking because retailers aren't getting the revenue they earn with other products. Wal-Mart announced earlier this year it was eliminating 1,100 "nonperforming" titles. Grocery stores rather sell canned peas than magazines. Yet, except for mailed subscriber copies, newsstands are still the only place one can buy most magazines.

Potential in Dollar Stores?
Do we need to change our current system to survive? Can we learn from the Chinese?

In China, publishers, both Chinese and foreign-leased, produce for a regional market. Beijing publishers distribute within the northeast part of China, and Shanghai and Hong Kong publishers distribute within their respective regions. Publishers individually work out distribution with newsstand vendors to sell their products.

Readers in China are not used to mass amounts of printed media at their disposal, and all magazines are in great demand. Sales are expected to continue at an unprecedented rate.

Changing the perception of a magazine as a luxury item is one thing, but it is quite obvious we do not have the rack space available to put outdated copies on sale. The management of those issues would be complicated, time-consuming and expensive for a relatively small return.

I wondered if the series of "dollar" stores, which are in every town in America, could become our new newsstands. We could place magazines in the stores, and all expired copies could be sold for a dollar. It would save waste, allow a longer life for the magazine's advertisers, and allow more titles to be made available.

What I found was that selling magazines in dollar stores is not a new concept. As a matter of fact, the Wal-Mart cuts have been reportedly linked to a successful program in which Meredith Corp. (though Meredith denies any link to the Wal-Mart cuts) was selling magazines and annuals through Dollar Tree stores at a lower rate than at Wal-Mart. A spokesman at Dollar Tree declined to elaborate on that deal, but stated that details were widely available on the Internet. He also said that Dollar Tree's partnership with Meredith was highly successful for both companies, and the company would be interested in discussing deals with other interested publishers. In an April 16 article in the New York Post, however, Andy Sareyan, president of Better Homes and Gardens and a corporate executive vice president for Meredith, is cited as saying the Dollar Tree program will be shut down at some point in the first half of the year. "It was a testing program," Sareyan told the Post.

The Chinese system of selling "old" copies at a discount until they were gone didn't seem to be attractive to Dollar Tree. They have the same issues with rack space as everyone else. But, they can offer a means for publishers to put out affordable magazines. Ad sales will benefit from these newsstand numbers.

Then maybe we can turn our current conventional newsstand racks into a premium source of purchasing luxury items. Travelers buy magazines in the airport because it is convenient-where and when they want it. I propose we price our conventional newsstand copies at a premium. Consumers already accept the fact that milk is more expensive at a 7-Eleven than at a larger grocer, but they'll pay the difference for the convenience.

Being in this industry for 30 years has allowed me to see the industry from many different perspectives. One that I didn't like, as a production manager, was the constant belief that the magazine had to do whatever it needed to get an advertiser in. We'd hold up deadlines just to accommodate late advertisers, and salespeople would promise the world to them. I tried to point out that it was the advertisers who needed us, because if they weren't in the issue, their competitors were. In other words, our magazine had value.

It's time we all realize that our magazines have value for what they are. We have to stop trying to be something we no longer are. Our readers see us as a luxury item, and our suppliers are selling at the highest historical rates.

We need to cut the waste that is inherent in our newsstand system. We need to charge a premium for the luxury of having the magazine delivered to the home, we need to charge a premium for the convenience of newsstand offerings, and we need to open new avenues of distribution.

If you are not already doing so, it is time to think outside the box. Challenge old methods. Dare to try new ones. Make a statement for the environment and minimize our old acceptance of material waste. The magazine market is changing. The question is, are you progressive enough to change, too?

Steven W. Frye is owner of Frye Publication Consulting in Hailey, Idaho. He is an expert in production processes, and has negotiated printing, paper and distribution contracts for dozens of publishers. He can be reached at Steve@SteveFrye.com.

Magazines: Ad Pages Slip First 4 Months Of '08

Magazines: Ad Pages Slip First 4 Months Of '08
by Erik Sass
http://publications.mediapost.com/index.cfm?fuseaction=Articles.san&s=82433&Nid=42743&p=204904

Most big magazine publishers saw total ad pages decline in the first four months of 2008 compared to the same period last year, according to the most recent Group Publisher's Report from TNS Media Intelligence. While some losses can be attributed to the closing of various titles since last year, the broad nature of the declines, cutting across a number of categories, looks ominous for the magazine industry.


(None of the magazines named in this article are necessarily the sources of declines at their respective publishing groups; they are simply some of the leading titles published by those companies.)


Among the "big three" publishers, Time Inc. is definitely faring the worst, with ad pages down 8.2% in the first four months of 2008 to 8,467. Conde Nast and Hearst experienced more modest declines. Conde Nast--which publishes Vogue, Vanity Fair, Glamour, GQ, Details and Portfolio--saw ad pages fall 2.9% to 11,961. Hearst--publisher of Good Housekeeping, Harper's Bazaar, Cosmopolitan and Esquire--saw ad pages slip 0.6% to 5,614.

Enthusiast and lifestyle publishers were not spared. Bonnier Magazine Group--which purchased a number of enthusiast titles from Time Inc. in 2007, including Field & Stream, Popular Science and Parenting--saw ad pages fall 9% to 4,759 in the first four months of 2008.

Hachette Filipacchi Magazines (publisher of Elle, Woman's Day, Home, Car and Driver, and American Photo, among others) fell 7% to 4,083. Hachette closed the print version of Premiere, an entertainment news title, in favor of online-only publication in March 2007; the decline in ad pages may reflect this move, at least in part.

Meredith Corporation--publisher of women's interest titles, including Better Homes and Gardens, Ladies' Home Journal and Family Circle, saw ad pages tumble 13.4% to 3,359.

American Express Publishing Corp., which publishes Travel + Leisure and Food & Wine, is down 5% to 1,280 ad pages. Source Interlink, which publishes Motor Trend, Automobile, Hot Rod and Soap Opera Digest, is down 17.1% to 1,828. Finally, Wenner Media, publisher of Rolling Stone, Men's Journal and Us Weekly, is down 9.1% to 1,186.
----------------------

Rodale Builds Muscle with Men's Health
By Amy Wicks
http://www.wwd.com/memopad/article/124925?page=0

LIFTING THE VEIL - SORT OF: On Wednesday, Rodale Inc. gave a glimpse into its performance so far this year, which included an increase in print advertising revenues of 8.8 percent, although ad pages declined slightly by 0.6 percent. There's a limit to its openness, however - the company doesn't actually provide profits and sales, or dollar figures of any kind.

Men's Health recorded a 12.1 percent jump in revenues compared with the first quarter of last year; however, ad revenue decreased by 5.6 percent and ad pages were down 11.4 percent, according to the Publishers Information Bureau. The January/February issue of the magazine sold a record 750,560 copies on the newsstand, coinciding with a cover price increase to $4.99 from $4.50. Men's Health editor in chief David Zinczenko's book, "Eat This Not That!" has sold more than 400,000 copies since December and is currently the best-selling health and fitness title in the U.S., according to a spokeswoman.

Meanwhile, Women's Health continues to build on its early success, up 50.8 percent in ad pages and 133 percent in ad revenue. On Tuesday night, the magazine held its first major event in New York, hosted by Chloë Sevigny, and Jessica Stam was one of the DJs. The event showcased a new partnership between the magazine and the Environmental Media Association.

Over at Best Life, ad revenues and pages were both up, at 25.6 percent and 8 percent, respectively. Runner's World Media Group had mixed results, with a 6.1 percent revenue increase but Runner's World magazine had a 2.3 percent dip in ad revenue and pages were down 6.7 percent. And Bicycling magazine's ad revenue was up 2.4 percent, while pages fell 3.5 percent.