PPA chief executive, Jonathan Shephard shares his outlook for PPA in 2009 and beyond
21 Nov 2008
PPA chief executive, Jonathan Shephard shared his outlook for PPA and the publishing industry at the CEO Forum and Marcus Morris Award Lunch on Monday 17 November in London.
"We live in exciting times. Technological change and economic downturn are going to make the next couple of years particularly difficult. But we have been through downturns before; emerging as leaner and fitter, and returning to normal levels of profitability. The death of magazines has been greatly exaggerated: human nature does not change – though human behaviour may. It will always remain the case that people will want information and entertainment from a trusted source; and magazine brands – print, online, face to face – are still uniquely placed to meet that desire for information and entertainment and for that relationship of trust.
Kevin O’Malley, publisher of Esquire, talked of a YouTube world of “aimless wandering”, and contrasted it with media that engage and which create an “immersive environment”. All of this is good news. What we are good at is engaging with our readers, whether print or online.
Magazines and their brands do provide safe havens: they have to work with and through the search engines, and one of the functions of a trade body such as PPA is to make sure that the regulatory environment is as favourable as possible to the content owners, and that profit is not excessively soaked up by other parties, including companies that build their entire business model on making free use of content generated by others.
One element of mayhem is legal. The other is the excess of content and the threat that, in a parallel to Gresham’s law, bad content will drive out good. The cost difference between generating high value content and low value content is very large, and online content needs to be paid for, somehow, in an environment where the expectation is that content will be free.
What about the death of print? There’s a particularly dismal mindset, exemplified in this statement from February 2007 in the daily free press “Some media analysts are saying that it is not yet time to write off print media completely”. I should think not: yes of course magazine brands will tend to be dual media or more, but the advantages of print remain – its portability, the way in which it is scanned differently from text on a screen. And we have to get away from the mindset of thinking that print has ceased to evolve.
All media interconnect. Magazines drive online, magazines will drive on to MMS, and MMS will respond through SMS or email, locking the user even more closely into the relationship with the magazine. The best brands will have media channels which support and reinforce each other.
One of the tasks for the magazine industry is to continue the engagement with the next generation of readers. Magazines are a uniquely engaging medium for people willing to be engaged by the medium. It would be wrong to think that teenagers will naturally gravitate towards reading magazines, if they are seen as a less familiar medium than the digital world in which they have grown up.
Legislation and regulation
We live in a world of legal and regulatory constraints. Sometimes they’re beneficial – copyright laws protect (at least in their current form) the rights of content generators and content owners. Sometimes they’re unduly restrictive, for example undue restrictions on advertising. Governments don’t have much power these days but do like to be seen to be doing something. A new statute is something: so why not do that. And the temptation for Governments is always to regulate the well-behaved and easily found, because they can be identified and got at. So let’s pick on any issue – childhood obesity, body image, environmental pollution let’s blame magazines because they’re an easy target. And let’s pretend that adults are so unaware and uninformed and vulnerable that they have to be reminded that a BMW has higher CO2 emissions than a Smart car – and not just reminded: they need, according to a UK MEP, to have the facts blazoned across 20% of the advertisement. It has a certain degree of sweetness for politicians, but it is the sugar in the petrol tank: which, in the end, can make the engine seize up.
Potentially, the regulations are not the grit in the oyster but the grit in the machine. The two major problems are a potentially lethal combination of mindset and timescale. There is a mindset in the European Parliament (and in Westminster) that advertising is evil and that content should be free. Put those together, and it does drive a coach and horses through the business models of many publishers.
That’s the first problem. The other problem is timescale. European legislation takes a long and tedious time to get through. The larger PPA members do have expert legal departments, but on the whole they are not looking six years out. That is where PPA, working with the Germans in particular, and through FAEP has a potentially crucial role in changing the minds of the Commission while their thinking is still fluid. We also have to lobby in Westminster, so that UK representatives in Brussels are fully briefed. It is unexciting, unglamorous, detailed work, but it is essential, because by the time anything hits the radar screen in the UK it is likely to be too late.
Eternal vigilance is the price of freedom. Even with a trade body ahead of the game there will be wins and losses. Without a trade body, the likelihood is no wins at all
The changes that are now taking place at PPA are designed to build on the solid foundations established by Ian Locks, and to adapt to a rapidly changing context. If content is king on the internet, the same applies to trade bodies. Our influence in Brussels and Westminster, and with the Press, depends on our knowledge and expertise. To have maximum effect, we need the best intellectual capital in the business.
Creative media in the UK economy
Magazines and related activities have a turnover of more than £7bn. Applying standard multiplier effects the impact to the UK economy is more than £9bn. The UK magazine industry is a significant employer, with 62,000 full-time and 52,000 part-time employees. Creative industries – directly and indirectly – are responsible, on Government figures, for 12% of UK turnover and 13% of UK employment. In a worldwide media market, we can use the high levels of creativity in the UK, plus the advantage of the English language, to punch above our weight.
Magazines and their related products are a social good. They entertain, inform and educate. They build communities of readers, and sustain local communities through the trade which they bring to the corner shop. The sense of adventure and innovation which brought us into this industry will see the industry thrive in a media landscape where continual change brings continual opportunities. We should all be proud of being part of one of the UK’s most vibrant and dynamic industries.
Our job at PPA, working with newspapers, music publishers, book publishers, and with broadcasters and many more, is to ensure that the Government recognises the importance of the creative industries, and recognises that the future is print and digital, not just digital.
The key aims for 2009 are to improve the quality of everything we do, and to improve the value to all of our members from all parts of the sector, large and small.
The fun of the job is making PPA the best media trade body in the UK. And we can do that."
Details from sheelagh.doyle@ppa.co.uk at PPA on 020 7400 7528.