Editorial: Are magazines ready to change?

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It was a moment of truth. Midway through the CEO panel at last month's American Magazine Conference, moderator Ken Auletta interrupted a litany of complaints about the industry's ailing business model. "I'm not talking to four journalists," he reminded the chief executives of Time Inc., Hearst Magazines, Hachette Filapacchi Media U.S. and Reader's Digest Association. "You all run big media companies."

In other words: Stop talking about problems, start solving them. We enthusiastically second that. The four executives on the panel, and scores of others at the conference, took a refreshing first step simply by confronting their challenges. Too often, industry conferences labor so mightily to be uplifting that they come across as dishonest. This year's AMC featured obligatory pep talks but added more than a few doses of reality as speakers outlined common obstacles and charted potential paths around them.

The true test is whether their words will translate to real change. That's where our confidence wanes. The industry's chief concerns today are the same that worried executives in the last recession more than a decade ago. In the years since, those problems-notably an over-dependence on advertising unique to American magazines and a related unwillingness to charge readers their fair share-have only worsened. Advertising accounts for 57% of U.S. consumer magazine revenue, says Veronis Suhler Stevenson, up from 50% five years ago. "This is so ass-backwards it hurts," Reader's Digest Association's Tom Ryder said at the conference. Agreed.

In fact, the industry appears to mostly agree about what's gone wrong-and in that there is great opportunity. Some magazines have cut rate bases and risked short-term ad hits to deliver a higher-quality audience. Others should overturn long-standing practices that no longer work and define a better model. If they don't, they could still be talking about this in 2012.

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