The Brighter Side of Technology

April 16, 2009

One benefit of leaving New York and visiting technology companies on the West coast is that the conversation about media changes. One doesn’t hear as loudly the incessant drumbeat about the decline of magazines, which paradoxically is often lead by the trade press. 

In some respects perhaps it’s the difference between the glass being half full or half empty. This remark does have faint philosophical overtones. No matter where one is standing there seems a central truth: that the magazine value chain is being disrupted by forces, analytics, technology and the like. Avinash Kaushik from Google reminded us at the MPA digital conference how powerful web site analytics are in determining the value of the site. And this data is right out in the open for all competitors to see. The flip side, of course, is that this is an equal opportunity, opportunity.

San Francisco-based Salesforce.com, a company MPA has partnered with, is a good example of a company that is disrupting the sales end of the business but also bringing enormous value to it. Salesforce, as with other companies, positions itself as a “post-software” business, relying on “cloud computing” to deliver its technical services. The WSJ has poked gentle fun at the idea of “cloud computing” because the term is over-used and morphing into marketing language. But there is no confusion about making maximum use of computer power to drive business solutions. The solutions Salesforce offers for advertising management, by reducing labor, cutting costs and providing real-time tools, can certainly improve the magazine value proposition.

Like many in the magazine field I have been enamored of Web 2.0 protocols, mainly because it was something I could understand. Any term that hangs around too long falls into disuse and that is probably happening to Web 2.0; a lot of the real tech experts didn’t like anyway.

In October 2008 the MPA Board voted to change the definition of a magazine to this: “A magazine refers to branded, edited content, largely supported by advertising and delivered in print or in a variety of digital forms.” This was a perfectly reasonable solution to the Web 2.0 universe and the growing brand canopy that would likely include print, web site, video, mobile, digital extensions, and distributed media. This definition would include the growing crop of e-readers (Kindle, Plastic Logic, and FirstPaper) and the expected mobile applications for distributed and dis-aggregated media.

The term “brand canopy” suggests something neat and tidy, like a dinner setting before the kids show up. Of course it is not.  Post-Google history should remind us that we don’t really know what is coming. But it is coming. And the new magazine definition is robust enough to withstand the immediate future.

I’m preparing a speech on magazines in China for a group at Stanford University.  One of the advance questions is: “where is China on the consumer magazine timeline”? This is a very good question, but the response can’t be completely linear. China has had an upscale consumer magazine market for about twenty years; the U.S. for about 60 years. The top, advertising-driven consumer magazines titles in China are the big Western brands doing business under a variety of joint venture, equity and licensing agreements: Elle, Esquire, Cosmopolitan, Vogue, Seventeen, Men’s Health, Glamour, and so on. This trajectory is familiar; upscale fashion titles customarily enter emerging markets first and generally prosper.

The Chinese magazine industry has come a long way in two decades but will find it difficult to be competitive in sectors where international brands rule. Publishers in China have made remarkable progress in getting out from under the shadow of Communist Party dictates that insured at the birth of PRC media licenses were distributed to the favored and well-connected in the provinces.

Magazines have had a place at the American bedside and in its psyche for more than a century. That is not the case in China. While I certainly don’t think the established big brand magazines, including scores of domestic titles, are in danger of extinction. I think the thousands of unprofitable magazines, some still subsidized by the state, don’t have such a rosy future. But at the end of the day it will likely be technology and not government edict that has the greatest effect on the future of magazines in China.

Consider that China has more than 500 million mobile devices, many with search capabilities. China’s development of 3G capabilities are superior to what we have in the U.S. Chinese consumers are used to paying for information and content and quite comfortable with micro-payments. Here the hand-held device is very likely to become the primary screen. Now that might change or transform the magazine space!

I was talking about the architecture associated with Web 2.0. Useful as it was and is, Web 2.0 probably encouraged a little too much linear thinking—me too—as it was too easy to see mobile, video, and distributed media as extensions of the print and or web unit.  I think it distracted me from the other freight train coming down the tracks: pure technology in all its disruptive guises.

I mentioned Salesforce. There are many companies that are both disrupting and bringing value to the magazine brand canopy. When I was an editor and someone would mention Content Management Systems (CMS) my eyes would glaze over, as if I was listening to a lecture on XML.  Publishing history is replete with hits and misses regarding CMS; of companies that spent dearly on systems they had to eventually toss. And just when they thought they got it right, along came another option called Open Source CMS. Surprise, you don’t have to pay a fortune for this iteration.

If CMS was not a dirty word, it was not a pray falling from lips. We’ve offered practical CMS seminars at MPA and had to bribe editors to come. I recall chatting with associates at PC World/Macworld in San Francisco and their mantra is simple: everything begins with digital and you have to be able to monetize digital content across a growing number of platforms.  How simple, how direct, how right!  There’s an advantage to being an early mover in the digital space and conversant with technology.

Various industry executives have hailed the new generation of editors as “content managers.” I’m not sure how deep this nomenclature has moved into editorial organizations, but I know with the new breed of Web Content Management (WCM) systems, such as offered by Clickability, puts the editor in the driver’s seat. The company claims to be the first of its kind to deliver content to, and receive content from, any browser-enabled device, including smartphones, mobile phones, PDAs and e-books, as well as traditional computers.  This is not your father’s CMS.

Google’s CEO Eric Schmidt told an MPA group last fall that without edited, branded content the Internet would be a cesspool. Alright, we get it but now what?  Whatever Schmidt’s intention, it is obvious technology companies look at magazines as an opportunity, whether it’s Plastic Logic, a new MPA member, an e-reader very much designed with magazines in mind, or Collarity that helps publishers better monetize branded sites, or ScrollMotion that is developing interesting mobile apps for People.com.

The list is extensive and growing.

When I first discussed MPA membership with HP two years ago, they asked one question: “How can HP help improve the magazine value chain.”  There are many opportunities, of course. HP is involved in a range of activities that could impact our business, from developing flexible screens to a new printing-on-demand service.

HP is one of the partners supporting the Technical Display Center at Arizona State University. The initial funding from the U.S. Army is to develop flexible screens that could be used as lightweight navigation maps. This in itself would be a huge development and a great advantage for soldiers in the field. To be sure there will be other commercial applications down-the-road. A key breakthrough came in February 2009 when HP announced, in conjunction with DuPont and the Center that it designed a process of running rolls of plastic with imbedded electronics through a device that cuts individual panels similar to the way newsprint is processed by a printing press. The process is called Self-Aligned Imprint Lithography (SAIL). The shift from batch to roll-on-roll printing has significant cost savings. Nick Colaneri, director of the Center, is confident that the technology will find its way into e-readers and mobile devices.

Later I met with Carl Taussig, Lab Director, Information Surfaces, HP Labs in Palo Alto, CA to see first-hand the printing of these flexible screens.  The key feature, as suggested in the SAIL description, is that the patterning of electronics in the plastic substrate maintains alignment through the printing process.  This is a relatively high-speed process that can produce five meters of flexible screen a minute. Once this printing process is predictable and perfected, it will make flexible screens relatively inexpensive to make and applicable, it seems, to a variety of uses, including e-readers. The key consideration is not only flexibility; it is whether this process can scale and be as ubiquitous as paper.

The Lab is also looking into how it can improve E-Ink, which offers varying shades of gray and is used in most e-readers. Like other researchers HP is pushing past the white spectrum and researching additive color. Color, of course, is the Holy Grail for e-readers and might be coming sooner rather than later.

Fujitsu announced recently the first ever mobile information terminal to feature color electronic paper. According to a press release the “color e-paper mobile terminal features an easy-to-view 8-inch display screen capable of showing colors in high-definition.”  Sony is also hot in the color hunt, using a technology called organic light-emitting diode (OLED) to produce brilliant pictures on a 3 mm screen. A version was shown at the CES this January. HP and the Flexible Display Center are very keen on OLED.

HP has also developed a magazine print-on-demand service called MagCloud (They will be presenting at our IMAG Conference May 17-19 in Boulder and is another reason to come). The technology is interesting in itself and so is the application. I think this service could be attractive to publishers, large and small. It would be a useful tool for those looking for short run tests, custom publications and editorial premiums. As Andy Bolwell, Director of MagCloud noted, publishers could park this technology “under” a web site to provide within hours print-to-order services, whether it is in response to a last-minute advertiser request or to deliver mashed-up content for a specific community or event.

I just learned that researchers at the University of Lisbon have found a way, if I’m reading the initial briefs correctly, to imbed electronics in a sheet of cellulose-fiber-based paper. The first application for this disposable electronics would likely be paper displays, smart labels and the like. But you never know. European paper companies are taking this seriously and investing heavily in research.

Technology is certainly disrupting the magazine space. But with disruption comes transformation and new business models.

Charles McCullagh