What Will Magazine Publishing Be Like in 2020? January 14

By a strange coincidence, four separate events on the same day pretty much tell you everything you need to know about magazine media in 2020.

Not un-undead yet

I could have just waited a few hours and let the events of the day do the talking.

Early the morning of January 14, when I submitted my 2020 magazine-publishing forecast to Publishing Executive, I had no idea the day would foretell what lies ahead for magazine media.

Within a few hours of me finishing that article, four different announcements provided glimpses into what’s in store for publishing this year. (PubExec added notes about two of the announcements before publishing my article.):

1) Change of Fortune
The New York Post revealed changes in store for Fortune magazine that checked off three boxes in my forecast: a “tiered paywall” on its web site, reduced frequency for its magazine, and upgrading of its paper. It didn’t take a crystal ball to see that those three trends from 2019 would continue into this year.

2) Chopping plants
LSC Communications, one of the two megaprinters that dominate U.S. magazine printing, announced the closure of three magazine and catalog printing plants, including one of the nation’s largest. My article noted that “heavily indebted LSC was left in a weakened state” and is “shaky,” but I wasn’t expecting such a swift, radical downsizing.

All three plants were noted for producing relatively large-circulation magazines, including some with print orders in the millions. Their closure underscores a theme that will continue to play out in 2020: Magazines are nearly dead as a mass medium; the future lies in niches.

3) Paper cuts 
Resource Recycling published an article pointing out that Verso Corp. had stepped up its plans to shift some production capacity at its Duluth mill from supercalendered papers to packaging papers.

Verso’s original plan was to start making 48,000 tons of packaging papers starting early this year, but in a recent financial filing it raised that number to 90,000. And it said that might be just the first step to a complete conversion that would eliminate production of printing papers.

Like LSC’s giant, doomed Mattoon plant, Duluth’s strong point is rotogravure products, which are typically used for publications and newspaper inserts having print orders in the millions. No wonder Verso would rather use the mill to make cardboard.

Duluth’s gradual conversion probably won’t rile the paper market. But, publishers beware: I believe other such machine conversions are likely to cause some sort of paper shortage this year, as explained in the PubExec article.

4) Zombie renaissance
Meredith Corporation had its struggles last year, but its zombie resurrection strategy wins my vote for New Business Model of the Year. It revealed a new twist in that strategy on (when else?) January 14 in announcing the new Rachael Ray In Season quarterly bookazines.

Just a few months ago, Meredith “zombified” Rachel Ray Every Day -- killing off the monthly magazine and transferring its subscribers to other Meredith titles, while keeping it undead with occasional newsstand-only issues.

Light my fire? No thanks

Last week’s announcement didn’t go full zombie resurrection, since there was no reference to subscriptions. However, the commitment to a quarterly publication schedule of seasonally themed issues and the emphasis on advertisers (bookazines usually contain few if any ads) suggest that the Princess of Perky may once again have a real magazine.

This time, though, it’s likely to be more of a niche effort, with a target circulation that’s only a fraction of the million-plus numbers of Rachael Ray Every Day's zenith. And, of course, it will have a higher price, more pages, lower frequency, and better paper than its predecessor.

Bonus prediction: Don't hold your breath waiting for Rach to start hawking vagina-scented candles. Goop is going to have the monopoly on that one.  
 
Other Dead Tree Edition commentaries on the "magazine media" industry include:

• Meredith's TIME Management Problem
• Need a Loan? Subscribe to a Magazine
• Which of These Headlines Is Defamatory?

 

Combining Roto and Web Offset on the Same Product

By Jack Graber
Part 3 of a 3-part series. (See part 1, "Rotogravure: A Missed -- and Misunderstood -- Opportunity for Publishers" and part 2, "Advantages of Rotogravure vs. Web Offset".)

For many publishers, the answer is not heatset web offset or rotogravure but rather a combination of the two. They may print the bulk of the body pages rotogravure but use offset for covers and for press forms with small page counts or different versions.

So the answer of when to use gravure is going to be based on several factors:

• The size of your publication

• The number of pages

• The quantity to be printed

• The number of versions

• The paper type

All of these factors must be considered before making your final selection. Many people are under the mistaken impression that you must have a large number of pages to use rotogravure. Yet a 16-page catalog with 6 million copies may be an ideal candidate for rotogravure, whereas a 64 page book for 500,000 may require a closer analysis.

As a general rule, it is the number of impressions that are the important factor. If the page counts are too small and the impressions after filling the press running 4 or 5 up are too small, then rotogravure would not be economically viable. On the other hand, if the page counts are larger, then printing a gravure form is definitely something that should be examined.

Recent advances in the digital engravers (pictured above) that make the rotogravure cylinders have increased speed and accuracy and have somewhat reduced the breakeven quantity needed to look at the gravure process. With today’s technology, you can definitely go below the one-million impression count that used to be inviolable in the United States.

So analyze the factors described, establish a solid partnership with your print supplier and consider mixing a rotogravure printed form with your offset covers for maximum flexibility, quality, and cost savings. At the end of the day, the right understanding and analysis – not your publication’s size -- will determine whether you can benefit from gravure.

Advantages of Rotogravure vs. Web Offset

By Jack Graber
2nd in a 3-part series
(See Part 1, "Rotogravure: A Missed -- and Misunderstood -- Opportunity for Publishers".)

Rotogravure has a variety of advantages over heatset web offset (HSWO), which is the usual method for printing magazines and catalogs:

• Lower running (per M) costs, especially when filling the entire press.

• Having no intermediate blanket, ink-water balance problems, or printing of wet ink on wet ink, rotogravure can lay down a greater proportion of ink with more consistency than HSWO. That leads to superior detail and depth of color even on the lightest of papers, which means publishers can reduce their paper and postage costs without sacrificing quality

• Rotogravure is better suited to lightweight uncoated papers. When HSWO printers use lightweight supercalendered papers, the low surface strength often leads to slower press speeds, linting, and high ink usage. Not so with roto. Rotogravure printing on a good SCA can actually achieve print quality equal to that of HSWO on a more expensive lightweight coated #5 paper.

• The variable cutoff leads to less trim waste because you can tailor the cylinder size and web width. HSWO presses have a fixed cutoff.

• The ability to print large signatures, such as 96-page forms, enables some publishers to save on bindery costs by using fewer hoppers.
  
  
• The ability to print large numbers of pages on one press also can reduce cycle time.

Next: Part 3, "Combining Roto and Web Offset on the Same Product"

Rotogravure: A Missed -- and Misunderstood -- Opportunity for Publishers

By Jack Graber

(Dead Tree Edition is pleased to welcome guest author Jack Graber, a member of Production Executive's Hall of Fame and most recently Director of Production and Corporate Paper for Redcats, a leading multi-catalog company. Although he's a catalog guy, even magazine people recognize him as the best in the business when it comes to figuring out whether rotogravure or offset, or both, are best for a particular print job. You can reach Jack at jlg500@aol.com. This is the first of a three-part series.)

Many publishers are overlooking a great opportunity to save money and improve print quality on the current crop of lightweight papers. That opportunity is rotogravure, one of the most misunderstood of the major printing processes.

Roto competes head to head with the more popular web-offset process for the production of high-volume catalogs and magazines. But previous rules of thumb about roto have misled many people, especially in North America, regarding how much volume you need to make rotogravure competitive with web-offset.

The popular rule of thumb is that it takes a print order of 1 million for roto to break even with offset, but in many cases it may make sense for much smaller press runs.

To understand the advantages of the process, we must first grasp the basics of rotogravure production. It’s an intaglio process, which means the image area is separated from the non image areas by being engraved below the surface – in this case into a smooth copper cylinder. Digital data for text and images feeds a machine known as a Helioklischograph, which does the engraving with diamond heads. The entire cylinder rotates in a bath of ink. As the cylinder turns, the excess ink is wiped off by a flexible steel doctor blade.

The paper is printed directly as it passes between the printing cylinder and the impression cylinder, with the impression cylinder containing an electric charge that causes the ink to be removed completely from the engraved cells.

The publication gravure press has the web going through the first four units, where only one side of the paper is printed at a time. Each color is dry before the next color is printed. The paper then travels up to be turned over and to have the second side printed. (In contrast, web offset prints both sides at the same time and does not dry one color completely before another is applied.)

The web of paper then goes through two folders – an upper folder to slit the larger web into what are known as ribbons and the lower folder to make the final signatures.

One advantage of gravure is the many options for sizes and page counts because both the cylinder circumference (or cutoff) and the web width can vary. For some of the high page-count magazine and catalog formats, you can print as many as 144 publication-size pages on the same press.

It costs more to start up a rotogravure press than an offset press, and it takes somewhat longer to make cylinders than offset plates. However the greater press capacity allows for less overall production time and the printing of less total forms for the bindery.

Next: Part 2, "Advantages of Rotogravure vs. Web Offset"

R.R. Donnelley Stalks Quebecor World

For many large American publishers there are only three printing companies. Soon, there may be only two.

R.R. Donnelley stunned the printing and publishing industries today by announcing its offer to be the "stalking-horse" bidder for rival Quebecor World, which is about to emerge from bankruptcy reorganization. It offered Quebecor's creditors, who essentially own the company, everything they would receive from the reorganization (which for many unsecured creditors is at most 50 cents on the dollar) plus 15% ownership of Donnelley. Donnelley stock closed down 9% today, making the stock being offered to the Quebecor creditors worth about $360 million. (See also "Q&A on the Donnelley-Quebecor Deal".)

Donnelley's proposal letter expressed confidence that the deal would be approved by the U.S. and Canadian governments, but the word "antitrust" was on the minds and lips of many major buyers of printing today.

Donnelley may point out to government agencies that the United States has thousands of printing companies. But only three -- Donnelley, Quebecor, and the privately held Quad/Graphics -- have rotogravure publication presses. And only those three have co-mail pools that typically contain at least several million magazines and/or catalogs. As good as they may be, "second-tier" printers with only offset presses and smaller co-mail pools simply cannot compete with the Big Three for much of the long-run catalog and magazine work in the U.S.

For parts of the market, such as for rotogravure magazines inserted into newspapers (like Parade and American Profile) and for telephone directories, it's really the Big Two, with Quad mostly or completely out of the picture. Quad has been trying to break into the newspaper-insert magazine market for years and reportedly built its Martinsburg, WV plant because it (mistakenly) thought it had a deal to print USA Weekend.

But a foray into coupon printing years ago that nearly bankrupted the company has engraved a commandment into Quad's corporate DNA: Don't get into price wars on printing. The Wisconsin-based company tends to compete instead with features like high-speed binderies and efficient co-mail pools -- which are irrelevant in the if-we-get-this-business-at-this-price-will-we-have-any-profit-margin? world of printing Sunday newspapers.

With its stalking-horse bid, Donnelley would set the bar for anyone wanting to buy all or part of Quebecor World, though the creditors would still be able to seek better deals. Even if the proposal does not pass anti-trust muster, it could be a winner for Donnelley by preventing competitors from buying Quebecor plants at fire-sale prices and then using their nearly debt-free status to undercut Donnelley.

I would love to hear your concerns, questions, or insights about the Donnelley proposal. Please email them to Dead.Tree.Edition@gmail.com. I promise not to attribute any comments to you or your company without your authorization.

Is Quebecor back from the dead?

Is Quebecor World ready for a "return to greatness," as Printing Impressions suggests in the glowing cover story of its latest issue?

At first blush, it's hard to see an exciting future for a company that has already lost $1 billion this year after going Chapter 11. After all, the giant printing company acknowledged in a financial filing recently that it faced "challenging market conditions, resulting in price erosion and decreased volume in most of the Company's markets."

But dig a little deeper and you will find some signs of strength. Most of the $1 billion loss was a writedown of the albatross that almost brought QW to ruin, the European division that it sold in June. QW World has not used much of its debtor-in-possession financing since filing for Chapter 11 in January and experienced positive cash flow, though barely, in the third quarter.

An apparent blessing of the Chapter 11 filing, at least so far, is that counterparties canceled all currency-hedging contracts with QW, which has Canadian plants that produce items for the U.S. market. The U.S. dollar has gained more than 20% on the Canadian dollar since then.

Another blessing came from the U.S. Postal Service last year when it overhauled rates for Periodicals and Standard flats mail in ways that enhanced the incentives for co-mailing. Only R.R. Donnelley and Quad/Graphics are in the same league as Quebecor when it comes to large co-mail and dropship pools for mailed flats, and in this case size does matter.

Of the three, Quebecor's efforts have been more focused on the small mailers (with circulation of, say, less than 100,000) that have flocked to co-mailing in the past year or so and that gain such huge postal savings when participating in QW's large co-mail pools.

I was at an industry function recently where several executives talked of there being only three printers -- QW, RRD, and Quad. Certainly there are others, some of them sizeable companies with stronger credit histories than QW. But without rotogravure presses (rumored to be more profitable than offset), huge co-mail pools, and extensive dropship networks, it's hard to see how they can compete with the Big Three for most medium- and large-circulation publications.

Printing Impressions quotes company executives as saying the new QW is more streamlined and has fewer silos, doing innovative things like using available magazine press capacity (which no doubt there is a lot of these days) "to meet peak four-color educational textbook demand." And QW has definitely been more aggressive in recent months about reaching out to customers and potential customers -- for example, sponsoring and participating in webinars held by Folio: and Multichannel Merchant.

The big question is whether QW is now strong enough to ride out the turbulence of a severe recession and lean enough to thrive as many customers permanently reduce or even eliminate their demand for printing.