Summary:
Macmillan, Ltd (UK) name new CEO:
Newspaper Circulation Figures Down
Outlook for Contract (Magazine) Publishing
Expectations for Professional Publishing
K-III Begins New Era; Reports Record Third Quarter; Announces Name Change and Growth Strategy
Charles Siegel Named Chief Operating Officer of K-III Consumer Magazine Division Search Continues for President of Media Group:
Another Celebrity Book Bites (the Dust)
News Corp. Posts a 9.5% Profit Boost For 1st Quarter, Topping Expectations
The Mouth Strikes…TED TURNER
Reuters and Chutzpah:
Amazon.com biggest Penguin Customer
Publish Your Own Book
Golden Books and Disney Licensing
Leading Online News Delivery Services Merge as NewsEdge
Interactive Journal Exceeds 150,000 Mark In Paid Subscribers:
Technology Brief: Easing of Indian Internet Rules
Recent News:
Macmillan, Ltd (UK) name new CEO:
RICHARD CHARKIN, former chief executive of Reed International Books, is to return to mainstream publishing as chief executive of Macmillan, Ltd. Mr Charkin, who will be responsible for all Macmillan companies apart from St. Martin's Press and Macmillan Magazines, succeeds Nicholas Byam Shaw, who is 64 and has worked at Macmillan for 34 years. Mr Byam Shaw will act as deputy chairman of the company and Mr Charkin and John Sargent, chief executive of St. Martin's Press and Ray Barker, managing director of Macmillan Magazines, will report to him. Dieter von Holtzbrinck, of Holtzbrinck, the privately-owned German publishers that bought Macmillan two and a half years ago, will become chairman of Macmillan. (The London Times)
Newspaper Circulation Figures Down:
Circulation figures released on Monday show Sunday sales dropping at many of the biggest Sunday papers. Five of the top eight Sunday editions showed declines according to ABC figures -three of them, The Washington Post, NY Daily News and The Chicago Tribune showed large declines. The Daily News sold 80,000 fewer newspapers for the prior six months than in the year before. Sunday circulation is important to newspapers because a Sunday paper reaps about three times the advertising revenue of a weekday paper. The Daily News, which has the country's sixth-largest weekday circulation, attributed the drop in Sunday readership to a price increase in April, to $1.50 from $1. (Editor and Publisher)
Outlook for Contract (Magazine) Publishing:
USA Today reported on the rise in the number of "lifestyle" magazines with "splashy graphics" that are sponsored by companies like Mercedes-Benz (Momentum) or Philip Morris (Unlimited) Land Rover (LandRover Journal). According to USA Today, "These magazines are a booming business for mainstream publishers. Magazine Publishers of America estimates that contract publishing generates more than $1.3 billion in annual revenue for publishers. There are some ethical issues as these corporate magazines increasingly look like independent magazines. Also, the report says, "Media watchdogs grumble about cozy relations between marketers and publishers." (USA Today, 12B, Nov. 1997)
Expectations for Professional Publishing:
The latest media industry mega-deal between Dutch giant Wolters Kluwer and Reed Elsevier, two of the leading publishers in legal, medical, scientific/technical and business markets, is another sign of strength in one of the segments of the publishing industry showing growth in 1997. Sales of professional books, journals, newsletters and online data are projected to grow 6.3 percent to $11.28 billion in 1997, according to Publishing for Professional Markets: 1997-98: Review, Trends and Forecast, the latest research report from Cowles/Simba Information.
Trade book markets are projected to remain flat this year. The industry reached an estimated $10.62 billion in 1996, up 6 percent from 1995, according to the report. Thomson Corp. was the leading professional publisher, with worldwide sales from professional information at an estimated $3.39 billion in 1996. Legal publishing remains the largest segment of the professional publishing industry, with revenues projected to reach $4.24 billion in 1997, up 5.9 percent from 1996. According to the report, books, online and newsletter/looseleaf are the leading delivery methods for legal information and Thomson is the leading legal publisher-at least until the Reed Elsevier/Wolters Kluwer merger is completed early next year. Scientific/technical is the second largest segment of the industry, followed by medical and business. Journals represent the largest medium for sci/tech information, while books account for the largest portion of medical information sales.
Online and books dominate the business segment. Books are the leading overall medium for professional information, accounting for $4.23 billion, or 37.5 percent of all sales in 1997. Thomson Corp., which generated $725 million in professional book revenues and Times Mirror, which generated $530.4 million, were the leading publishers of professional books in 1996. Journals represented the second-largest segment of the professional publishing industry, followed by online, newsletters/looseleafs, directories and "other" media, which includes some CD-ROM revenues and revenues from miscellaneous media, such as audio and video. The professional publishing industry is projected to grow 6 percent in 1998, 5.8 percent in 1999 and 5.9 percent in 2000, according to the report.
The legal segment is forecast to remain the largest and books will continue to be the leading medium for professional information over the next three years. However, online is forecast to surpass journals as the second-largest medium by 1999. Publishing for Professional Markets, 1997-98 includes an overall ranking of worldwide revenues for leading professional publishers, rankings for the leading publishers in each of the four industry segments-legal, scientific/technical, medical and business, as well as rankings of leading publishers by each major professional publishing medium-books, journals, directories, newsletters/looseleafs and online. In addition, the report provides revenue forecasts through 2000 for each of the four market segments and each major medium and detailed profiles for 34 leading professional and university press publishers. The report costs and can be obtained by calling Bill MacRae at Cowles Simba, or by e-mail at bill_macrae@simbanet.com. Business Editors STAMFORD, CT--(BUSINESS WIRE)--Nov. 3, 1997--
K-III Begins New Era; Reports Record Third Quarter; Announces Name Change and Growth Strategy:
NEW YORK, Oct. 30 /PRNewswire/ -- K-III Communications Corporation (NYSE: KCC), today reported that third quarter sales and EBITDA from continuing operations each increased 15.5% setting new records. The parent company of such prime media brands as Seventeen, Soap Opera Digest, Weekly Reader, Channel One, Ward's Automotive and The World Almanac, also reaffirmed its growth strategy: focus on its fastest growing businesses, complete certain divestitures and change the Company's name to PRIMEDIA. This quarter, the Company begins presenting results from continuing operations which exclude businesses that have been, or will be, divested. "The continuing operations results show our true earnings power," said William Reilly, chairman and chief executive officer. "As just one measure, EBITDA margins were more than two percentage points higher in the nine-month period when the divestitures are removed." Results from Continuing Operations (Excluding businesses divested in or held for sale)
($ millions) 3Q97 % Change 3Q96 9 mos %Change 9 mos 96
Sales $305.7 15.5% $264.8 $884.9 16.1% $762.0
EBITDA $63.4 15.5% $54.9 $192.3 15.1% $167.0
Margin 20.7% 20.7% 21.7% 21.9%
Charles Siegel Named Chief Operating Officer of K-III Consumer Magazine Division Search Continues for President of Media Group:
NEW YORK, Oct. 22 /PRNewswire/ -- William F. Reilly, chairman and CEO of K-III Communications (NYSE: KCC) announced today that Charles Siegel, 51, has been named to the newly created post of chief operating officer for its consumer magazine division. Siegel has held several general management positions at K-III, Simon & Schuster, and Macmillan Publishing Company. Most recently Siegel has been president and CEO of K-III's Newbridge Communications. He will manage the team responsible for the 24 consumer magazines in the K-III Consumer Magazine stable. K-III's consumer magazines include New York, Chicago, Seventeen, Automobile, American Baby, Modern Bride, Soap Opera Digest and Soap Opera Weekly. Siegel will report to K-III chairman and CEO Reilly until a replacement is named for the late Harry McQuillen who was president of the K-III Media Group. A search for a President of the K-III Media Group is still underway. learning and workplace learning), and information (consumer directories and business directories).
Another Celebrity Book Bites (the Dust):
Now you can get Paula Barbieri's book at a steep discount--$9.95, instead of the $23.95 list price. And in plenty of time for stocking stuffing. Barbieri's "The Other Woman," a memoir of her relationship with O.J. Simpson, arrived to a thunderous ho-hum recently, despite a $3-million advance that had been paid to the former model by a confident Little, Brown and Co. Rather than have to take back thousands and thousands of unsold copies, the publisher is offering booksellers a credit on each book sold, allowing them to slash the price. In the business, it's known as "remaindering a book in place"--a polite description for a book that is fizzling. Cowles Business Media
News Corp. Posts a 9.5% Profit Boost For 1st Quarter, Topping Expectations ---- By John Lippman:
Rupert Murdoch's News Corp. posted a better-than-expected 9.5% profit increase for its fiscal first quarter, citing a robust U.S. television-advertising market, and sounded an upbeat note about the current quarter ending Dec. 31. But per-share results fell, reflecting an increase in shares outstanding at the acquisitive Australian company. And pretax operating profit fell 43% at the Filmed Entertainment unit, as the Fox film and TV studio faced a tough comparison with a year-earlier quarter fattened by megahit "Independence Day." For the first quarter, ended Sept. 30, Australia-based News Corp. reported that net income rose 9.5% to US$243 million, or 26 cents an American depository receipt, from $222 million, or 27 cents an ADR, a year earlier. Revenue for the quarter increased 16% to $2.9 billion while cash flow -- earnings before interest, taxes, depreciation and amortization -- for the media giant rose 23% to $436 million. Operating profit before special items was up 7% to $240 million. The Wall Street Journal via Dow Jones
The Mouth Strikes…
TED TURNER, the founder of Cable News Network, yesterday reignited the personal feud with Rupert Murdoch by once again likening the chairman of The News Corporation to Hitler. Mr Turner, in London with his wife, Jane Fonda, was challenged yesterday by William Shawcross, author of an unauthorised biography of Mr Murdoch, whether it was true that he had likened the News Corp chairman to Hitler at a lunch on Monday. "I didn't use that word," said Mr Turner, who added that he had instead likened Mr Murdoch to "the former leader of the Third Reich". Mr Shawcross asked the American media mogul, who is now a vice-president of Time Warner, whether it was "appropriate for a businessman like you who pretends and purports to be working for the benefit of mankind to compare a competitor to Hitler?" "If the shoe fits, wear it," replied Mr Turner, who was in turn accused of a "stupid and cheap shot" by Mr Shawcross. Raymond Snoddy - London Times
Reuters and Chutzpah:
REUTERS, the online information company, is to charge many of its institutional clients for correcting the millennium bug that threatens to paralyze its equipment in the year 2000. The company, which yesterday detailed its approach to the problem, said that clients who need their computers changed overnight or at the weekend could be sent a bill for the privilege. The move marks a distinct break from the industry norm, where companies usually agree that their customers should not be asked to pay for the supplier's failure to plan for the date change. Raymond Snoddy - The London Times.
Amazon.com biggest Penguin Customer:
THE Penguin Group, the publisher owned by Pearson, yesterday said that Amazon.com, the Internet bookstore, may soon be Penguin's largest customer. Michael Lynton, Penguin chairman and chief executive, said that Amazon bought $1 million of books from Penguin last year. This year's total looked likely to be $10 million, and the growth rate was 40 per cent a quarter. Mr Lynton said: "If this current growth continues in the next two to three years, they will probably be our largest customer." More than 90 per cent of Penguin's US backlist sales come from Amazon. The enormous Internet backlist sales, Mr Lynton said, "could be of huge importance to us".
Golden Books and Disney Licensing:
Disney Licensing Deal Will Cost Golden Books At Least $47.7M (Simba/Book Publishing Report) Golden Books Family Entertainment will pay the Walt Disney Co. at least $47.7 million in royalties over the next four years for its recently extended licensing agreement, according to a document the company filed recently with the Securities and Exchange Commission. Golden Books has agreed to pay at least $7.4 million for the period between Jan. 1 and Sept. 30, 1998, then $11.7 million in the second, $13.3 million in the third and $15.3 million in the fourth year of the agreement, the document said. Cowles Business Media
Reed Elsevier Seeking Content Acquisitions:
Calling content "the crown jewel," Dutch multimedia publisher Reed-Elsevier said it is considering snapping up new content partners. Chatting with executives at a Financial Times publishing conference, Reed-Elsevier chairman Nigel Stapleton countered rumors that his firm was on the hunt to buy a software firm, saying "the thing that we're most looking to acquire is more and more content." Reed-Elsevier will be going through a little consolidation itself should its prospective merger with Amsterdam-based publishing giant Wolters Kluwer NV go through. The London Times.
Online Publishing:
Publish Your Own Book:
Nov. 3, 1997-- 1stBooks Champions Aspiring Authors, Bypassing "Gatekeepers" and makes it possible for authors to "publish" their work and still retain full legal ownership and rights. For less than $500, they will digitize an author's book and publish it on the Web, along with a "digital book jacket." This "virtual cover" offers the prospective reader much the same information as a traditional book jacket: a cover design or illustration, a summary of the book and a biographical sketch of the author. There is even a free two or three page excerpt from the text itself, for the potential buyer who might like to leaf through a few virtual pages before making a purchase. "A typical book in the library can be purchased and downloaded for $5.95 to $9.95, less than the cost of most paperbacks. A few highly technical books are offered for as much as $25.00. As hardbacks, they would probably cost $50 or more," The buyer can download the book electronically, and typically is offered a choice of formats. For authors who have gone the subsidized publishing route, the site also offers the opportunity of selling traditional bound copies of their books. The site also offers authors full-service accounting and record keeping, as well as detailed marketing, customer tracking and prospect-to-sale ratio information. And authors receive a commission or royalty of 40% of the selling price, less any credit card fees, on each "book" sold.
Leading Online News Delivery Services Merge as NewsEdge:
Established electronic news aggregators Desktop Data Inc. and Individual Inc., both of Burlington, MA, are merging companies and services in a stock swap deal to be closed in first-quarter 1998. The new company will be titled NewsEDGE Corp. -- named after the flagship news delivery service of Desktop Data -- and headed by Desktop Data founder and CEO Donald L. McLagan. Combined, the companies drew $75 million in revenues during the year ending Sept. 30, 1997 -- a 35% growth from the year prior.
Interactive Journal Exceeds 150,000 Mark In Paid Subscribers:
Dow Jones & Co. said The Wall Street Journal Interactive Edition has attracted more than 150,000 paid subscribers just over a year after it began charging for access to its site on the World Wide Web. The Interactive Journal has the largest circulation of any paid-subscription site on the Web and is among the top sites for generating advertising revenue on the Internet, according to Thomas Baker, business director of the Interactive Journal.
Technology Brief: Easing of Indian Internet Rules:
The Indian government said it has lifted all restrictions on the number of private Internet-service providers allowed to operate in the state-controlled Internet market and on the fees they charge subscribers. The companies, however, will still have to obtain government licenses to operate. The government said the aim of the move is to bring Internet connections to as many as two million Indians within two or three years, from 40,000 now. Until now, the state-run Videsh Sanchar Nigam Ltd. has controlled Internet access in New Delhi, Bombay, Calcutta, Madras, Bangalore and Pune, while the Department of Telecommunications provided access in the rest of the country. AP-Dow Jones The Asian Wall Street Journal via Dow Jones
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