Publishing executives at American Business Media's 2008 Spring Meeting last month in La Quinta, Calif., agreed that media companies will need to make radical changes if they want to continue to succeed in an industry that is itself changing dramatically.
“All media companies will have to work harder and smarter in order to succeed,” said Frank Anton, CEO of Hanley Wood and immediate past chairman of the ABM. “I think all of us need to reinvent our magazines.”
Gary Fitzgerald, president of Meister Media Worldwide, took over as ABM chairman for the 2008-09 term during the conference. In his opening remarks, he said: “The convergence of market dynamics has recast the competitive landscape. We are now moving from the development phase to the buildout phase.”
During a roundtable conference, CEOs discussed challenges facing the business media industry and how they are adapting their own business models.
“We can all agree that it is a turbulent and unsettled environment in which we're operating,” said Neal Vitale, president-CEO of 1105 Media, who moderated the panel.
-Other media executives agreed they are reworking their business models to adapt to a changing environment.
Tony Uphoff, CEO of TechWeb (formerly CMP's Business Technology Group), said the unit generated about 85% of its revenue from print just a few years ago. Today, TechWeb's revenue breakdown is about 25% print, 30% online and 45% events.
“We have completely and radically transformed our company, and put events and online at the center of the business and print around these businesses, which puts us where the dollars are going,” Uphoff said.
Charles McCurdy, chairman-CEO of Canon Communications, said that earlier this year Canon established an e-media division and is now staffing up in that area. The company is rolling out new digital products including e-newsletters, webinars and custom digital products, which have grown by 80% over last year.
Also during the ABM conference, a panel of investors said media deals are still getting done, although the structure of transactions has changed significantly as a result of tighter credit markets.
“At the smaller end of market, in the $25 million to $250 million range, there is a surprising amount of deal flow right now,” said Jeffrey Stevenson, managing partner at private equity firm Veronis Suhler Stevenson.
“For smaller deals, there seems to be financing available, although they are more expensive and lower leverage,” he said, pointing to higher interest rates and lower company valuations.