The Future of the Magazine Industry Doesn't Include Magazines

Patrick Tucker's picture

I just returned from the annual American Magazine Conference, or AMC, this year in Chicago, where I got a front row view of the future of my industry. In one presentation after the next, the heads of such giants as Hearst, Condé Nast, and Time (along with Oprah Winfrey) reassured one another that the future was increasingly bright.

“This year, magazines saw media share increase second only to TV,” said Nina Link, president of MPA: the Association of Magazine Media.

“Advertising sales are increasing again,” reported John Griffin president of National Geographic’s publishing division.

“Total magazine readers increased four percent in the last four years, second only to the Internet,” said Jack Griffin, (no relation) CEO of Time. Numbers from other sources bear out the grand recovery story. Last year, some 60% of magazine titles analyzed by the group Magazine Radar were flat or up in terms of revenue, and a third of them were up by at least 10%.

This resurgence of confidence among the publishers in attendance wasn’t just a product of positive sales numbers. A shift is taking place in the way people consume media. The days of being bullied by Huffington Post, Google, and other content aggregators are drawing to a close. The Web, you see, is dead, as noted by Wired Editor in Chief Chris Anderson in the magazine’s September cover feature. Consumers are turning away from searchable sites and moving toward what Anderson calls “semiclosed platforms,” devices that deliver a certain type of content over the Internet through specially designed software packages—read that as the iPad and all the apps that come with it.

The magazine industry sees the App revolution working in its favor. The iPad provides a captive audience and a clear revenue stream. It supports rich, expensively produced photos, layouts, and pop out features of the sort that consumer magazine publishers specialize in.

According to Jack Griffin of Time, “sixty percent of American consumers plan to purchase an e-reader; four out five e-reader consumers want to read magazines on those devices.” The industry has created 300 apps across the spectrum, said Griffin and added “It’s been a long time since we’ve seen such a burst in creativity.”

Some 30 million touch screen tablet PCs, lead by the iPad, are forecast to sell by the end of next year, according to Cheryl Goodman, director of marketing for technology giant Qualcomm. Research from Gartner indicates that 4.5 billion applications will be downloaded by the end of 2010 and that apps will generate $6.5 billion to 30 billion in revenue in 2011.

The iPad is truly a revolutionary device. But, as in any revolution, there are some clear winners and losers.

Among the losers at AMC appeared to be William J. Lynch, Jr. of Barnes and Noble. Prior to becoming CEO in March of 2010, Lynch was head of the company’s Web division. B&N saw a 45% loss in share price last year and, in August, put itself up for sale in a desperate attempt to shore up its finances. Lynch’s primary accomplishment as CEO was the launch of the Nook e-reader, which was released late and doesn’t showcase magazine material well. At one telling moment, Lynch admitted that the company would be retreating from the magazine space. “We’re pulling back on newsstand,” he said. “There will be fewer magazines on the [B&N] newsstand.”

Among the beneficiaries of the iPad’s success is Howard Schultz, CEO of Starbucks. He is perhaps an unlikely winner considering that, in 2010 at least, coffee can’t be consumed over an electronic interface. However, Starbucks is the largest wifi network in North America, with some 30 million users logging on each week in Starbucks outlets. At first, says Schultz, these customers “were mostly synching their emails. Then people began coming to our stores and looking for content.”

Schultz saw an opportunity. Earlier this week, the company launched what they are calling the Starbucks Digital Network. Customers who bring their iPads to one of Schultz's coffee houses will be able to access “free premium content” from a number of sources such as The New York Times and health giant Rodale, publisher of Runner’s World and Prevention. What does this mean? Without acquiring any more real estate, or nailing together a single shelf, Starbucks is in the act of becoming the country’s largest newsstand.

Strangely absent from this meeting of America’s top publishing executives was any discussion of how the appification of magazines would effect the journalistic content of their products. This is unfortunate considering that the last ten years saw an explosion in the number of people writing software to support journalism. Many of the most innovative ideas came from outside of the United States, such as a mobile phone-based service called Ushahidi developed by a Kenyan blogger to publically track outbursts of ethnic violence (mentioned by Clay Shirky in the current issue of THE FUTURIST magazine).

The iPad could play a part in that process of supporting serious journalism and growing its audience. But a careful look at the industry’s offerings in the iPad store shows why that hasn’t happened yet. The purpose of the magazine app, as presently conceived, is to combine divergent bits of media--video, graphics, and music--into a videogame-like experience, which is not the same as reading. Indeed, of the apps that were on display during the conference, almost all focused on cute movies with nifty interactive features and overtly ignored narrative journalism. Apps, after all, are commissioned by marketing departments and are built by software developers. Stories are made by journalists. Protecting the best and most worthwhile parts of the magazine in the age of the iPad may require reporters and editors to learn html5 in order to leverage the technology themselves to serve the mission of journalism. Many of America’s magazine publishers can’t be relied on to do that on their own.

Indeed, if the iPad is the communications medium of the future, that was its message this year in Chicago.