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ABM's Hughes sees rebound in '03

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(Fourth in a series of Executive Outlooks)

Gordon Hughes, president of American Business Media, turns to the gridiron for an analogy to describe the challenge b-to-b publishers face this year: “B-to-b publishing is like a football team that has good offense and good defense--delivering two platforms, print and Web--that must be integrated,” Hughes said in an interview with BtoB. After a tough 2002, with estimated ad pages and ad revenue declines of 12%, according to the Business Information Network, Hughes predicts b-to-b publishing will rebound this year.

BtoB: B-to-b ad markets are still lagging behind other media. How do you see 2003 shaping up in what remains a very uncertain ad climate?

Hughes: You’ll see ad revenues up around 3% in ’03. Most categories will be up, but I don’t see computer hardware and software up 'til the fourth quarter. I hope I’m wrong. But a lot of companies bought computers in ’99, and a lot of these computers have four-year life cycles. So, with increasing escalation in new technologies, companies will have to buy new systems, and then the advertisers will follow.

BtoB: Trade shows took a big hit in the wake of the Sept. 11 attacks, but they are starting to climb back to normal levels. How do you think they will fare in 2003?

Hughes: Internet-related trade shows still have major issues. I think the industry will be pretty healthy, up about 5% to 6%. Without the computer category it may be up 8%.

For the most part, everything is poised to move forward. Companies have cut down, and margins are back. People are back, too, and they want to do business.

BtoB: What is the long-term viability of traditional print products in light of the Web--not necessarily in terms of advertising but in the way people hunt for information?

Hughes: The smart companies extend their print brands online in a variety of ways that niche the publication and don’t duplicate the magazine.

Companies are being very aggressive in digitizing their products, but they have to know that digital will never replace print.

The real question here is broadband, which is still very primitive. Once it develops, companies will be able to do a lot more online with their [Web] products, and that will turn into better utilization. But they’re still separate animals.

BtoB: ABM’s lobbying efforts recently paid off in the formation of a Presidential commission on postal reform. What can b-to-b publishers anticipate from the commission’s report, which will be issued next summer?

Hughes: I’m an optimist, but I don’t want to be Pollyannaish. My hope is that the management of the USPS will be given the flexibility to control costs. In a bad economy, people can’t raise prices to cover their costs. I think [USPS] will be able to control costs by labor and location. The postal service will have to get a work force of 800,000 down to about a half-million, and they will have to close post offices.

Interview conducted by Matthew Schwartz.

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