Source Interlink, one of the biggest magazine distributors in the US announced Friday that it will soon end “substantially all” of its business operations, putting 6,000 out of work. The Wall Street Journal report documents some challenges for the category:
Companies such as Source Interlink play a major role in the magazine business, arranging for printed magazines to be distributed to retailers large and small. It has become a more difficult part of the business in recent years, as consumers increasingly use the Web to read digital content, including magazines. That shift has upended the economics of newsstand distribution.
While this story has no direct Australian connection, the challenges and economics are not dissimilar.
You would think that a business of that size (6,000 employees) would have the scope to shift scale and cut its cloth to suit it’s new shape.
I can only imagine that in context of a total shut down there must be other factors at play.
This is not a denial that magazine distribution is in trouble, but more a comment that the business model needs an overhaul. There are several alternatives if you want to think about it.
We probably need to spend more time thinking about the solution, rather than focussed the problem.