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CAT has the answer

5/7/09

Spare a thought, shed a tear, for the oldest computer magazine which died this month. Personal Computer World  outlasted Byte by more than a decade but it is no longer. From its heyday of 800 pages it fell to 150 and circulation from over 200,000 to 50,000. The issue on the shelves today will be the last. 1978-2009.

If PCW can’t survive then the periodical market doesn’t look to be in good shape.  Indeed the traditional model of growing vast forests so that they can be cut down to be shipped to printers, to be smeared in ink, then sent to warehouses where half are unsold and then pulped never seemed like a particularly productive one. It’s why the web has become the news medium.

Books still sell well, but periodicals exist in the space between books and news. So what happens there and why does it matter in the mobile phone world?

It’s because of the Kindle. Amazon has found a way to sell technology to old people, those that read books. If you want the latest Dan Brown you might as well download it. So now we have technology at both ends. The web for news and Kindle for books. The periodical needs something in the middle.

Like all good ecosystems that space is just about to happen. It needs three things. Just like something I said on mobile TV I’ve come up with this great acronym. So great I don’t know how I thought of it.

C.A.T.

CAT stands for Content,  Acceptance , Technology. 

Content means something that’s right for electronic devices to give a periodical like feel to an electronic device. There are a number of suitable candidates but the one with the critical mass of content is Zinio. This has a huge number of magazines which you can subscribe to and download. The file sizes are huge so it’s very much a broadband proposition but that problem is easing with better bandwidth. More importantly the device could download in background and overnight.

Acceptance means people need to be prepared to receive the content in the new form. There is no easy way to do this except for time, word of mouth and experience. The evangelism of Kindle users is perhaps the greatest tool here. There is a danger that carriers will push the solution harder than consumers want to accept it which leads to hype and disappointment so it needs to be handled gently. Slow organic growth. It can be helped by the paper periodicals promoting the electronic version, much as all the members of the DAB digital radio consortium promise to use their channels to promote the technology but needs to be done sensitively.

Technology means a device people want to hold. An important quality of many of the style magazine is that it is something readers want to be seen with in public. Sitting on the train with a copy of GQ or Vogue says something about you. That goes away with electronic readers so there needs to be a style message in the device. The most promising technology in this space is Plastic Logic, an electronic book that is way thinner, and has even better battery life than its rivals.

Put these things together and you have an ecosystem with a revenue model. It’s not about buying a device but about taking out magazine subscriptions. With some clever profiling of the readers – what they subscribe to, which articles they skipped and which ones they read, where they live, and work, when they have the downtime and when they are reading the advertisements within the content can be much more tightly targeted. That needs to be seen as the secondary revenue stream, particularly since agencies won’t ‘get’ the device straight away and as the Plastic Logic device is currently black and white the ads won’t look great.

For the mobile operator it’s another one of those closed ecosystems like RIM mail or iTunes but both of those have been a huge success.  It’s too late to save PCW, but it could save many of the historic magazines that are clinging on.

Cat Keynes publishes her thoughts on the mobile phone industry every Sunday at www.catkeynes.com you can read the column  the previous Friday by subscribing here. Follow me on Twitter here.

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