The Newsstand Debacle and the Regionals

City and regional magazine publishers, with their hyper-local distribution, are particularly exposed.

By Bill Mickey
Monday, March 30, 2009

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The newsstand mess, which exploded the distribution channel in January and continues to this day, has been an emotional and logistical rollercoaster ride. The seven-cent surcharges introduced by wholesalers Anderson and Source Interlink, which together represent 50 percent of the distribution market, partially collapsed the system and claimed one casualty in Anderson News.

The ensuing confusion—from printer to retailer—product backlogs, distribution route resets, and so on, have hit all publishers hard. But city and regional magazines, particularly those that don’t have a national distributor like Comag or Time/Warner Retail providing block and tackle coverage, are discovering they’ll have to pick up the pieces themselves—especially those that suddenly found themselves without a wholesale partner.

Pricing Changes Wouldn’t Have Mattered

Of particular frustration for Tami Long, newsstand director for Emmis Publishing (Texas Monthly and others), was that the seven-cent fee, aside from an economic patch, did not address the problems of the channel. And the fee never took effect anyway. “It was thrown out there willy-nilly,” she says. “It wasn’t attached to distribution. They didn’t look at the distributions, and that is a problem for regional titles. They’re unique. They can carry a big stick when they go into a [local] market.”

Long notes that for many regional publications, they’re ranking skyrockets within their market, and wholesalers did not necessarily pay attention to that—focusing instead on their bigger retail partners and the national publications.

Getting Back to DIY

And it’s the smaller regional publishers that, while strong in their own markets, may not have national distributor representation and will have to handle things on their own. “The other regional publishers, who did not have a national distributor, took the brunt of these changes and they might have a harder time to distribute,” says Debbie Thompson, audience development director for Chicago magazine.

And even the larger regionals with national distributor backing found they had to do some of their own direct interaction with retailers. “The problem is you have to make some noise,” adds Long. “The retailers don’t always notice this, and the wholesalers are more interested in the national titles. Regional publishers have to be more vocal and get to know their local buyers.”

Thompson points out that the anti-trust lawsuit Source levied against some publishers and wholesalers put a temporary hold on the ability for regional publishers to switch distributors. “When we were hearing all the bickering, the lawsuits wouldn’t let you try to find another distributor.”

In the meantime, Long was taking calls from some of the smaller retail chains looking for product. “They call me and say, ‘I can’t afford News Group, how can I get copies?’ Some of the smaller independent stores are just getting dropped. Right now it’s just economics.”