Politics and publishing, and investing in B2B media
Recently Cygnus Business Media said it would be divesting its Heavy Construction Group, a group that includes the trade magazine Equipment Today.The opportunity to own a few titles in the space seems pretty attractive to me – someone who published construction titles in the past – despite the problems B2Bs are facing maintaining ad pages and adapting to the growth of digital media.
But a news item this morning reminded me of some of the issues B2Bs face in today’s economic and political environment.
The President, the AP reports, will ask Congress for $300 billion in new spending for roads and railways. The spending is necessary, the President believes, because the Highway Trust Fund will be out of funds as early as August. To pay for the spending, the President wants changes in the corporate tax system. That means a reduction in tax loopholes and subsidies, of course.
Combine that with a recently announced new tax plan from House Ways and Means Committee Chairman Dave Camp (R-Mich.) which would simplify the tax system by reducing it to two tiers. It would also cut corporate taxes from 35 percent to 25 percent. One has to wonder what the chances are that the House, run by conservative Republicans, will approve new highway spending – especially if paid for with higher fees and few corporate tax breaks.
When I was publisher of the Daily Pacific Builder or Roads & Bridges magazine, these were the kinds of news stories I followed very closely. I was also, for a while, intimately involved in these matters when sitting on the Government Affairs committee with the large equipment manufacturer’s association. Whatever happened in Washington DC seemed incredibly relevant to the health and welfare of my publications.
But today, with many B2B media companies eliminating publisher positions, combining multiple titles under one publisher, one editor, there is little time to be so involved with one’s industry. Even understanding the industry one serves is often considered unimportant. This was brought home when I began to see recruitment ads from Reed Business Information for editor positions that did not even bother to mention either the name of the magazine involved in the search or the industry it was covering. If RBI, the largest B2B in the industry, didn’t think knowing anything about the industry one would cover was important, then what kind of magazines would result?
This was a far different way of looking at things then the way Cahners used to act (before Reed Elsevier purchased it). The Cahners philosophy was so simple it was almost a cliché: find the leaders in each industry and hire them away. If you were a sales person at a minor construction magazine and were successful at stealing a schedule from a client chances were that one day Cahners would come calling to hire you for their own magazine. It didn’t always work that way, it did enough that the B2B titles at Cahners generally dominated their segments.
It will be interesting to see who ends up buying the Cygnus construction titles. Will it be a company already publishing other titles in the industries, or someone with other products that could compliment the new titles? Or can one of the publishers at Cygnus attract some funding to launch their own company with these magazines and its trade show as its base? We’ll see.
But if Washington DC doesn’t make sure there is money to build and fix roads it might not matter how it this turns out. Yes, it really does matter what the economic health of the industry is, that is the way B2B works – and if you don’t think so, ask Caterpillar and John Deere and Hyundai and…
It would be nice to see these titles go to a start-up. I think a flood of new start-ups may be the B2B industry’s best chance to see a substantial turnaround. I also think it might be nice to see some of these start-ups be focused mostly on digital. B2B needs a kick in the behind to push it into the digital era. Many B2B have made a transition from being print ad page reliant to more diversified. That is a good trend. But the brands have been built on the magazine titles and to make the transition to digital these brands might come in handy when launching new products and services.