It seems somehow apt that the future, or at least one aspect of it, of the English language magazine business in India, depends on words and their import, in this case, the difference between 'management' and 'business'. Forbes and BusinessWeek, two of the best-known brands in the business magazine firmament, are hoping that the Indian government, whose laws prohibit foreign news and current affairs publications from setting up shop in the country (although they can take up to a 26 per cent stake in an Indian company and then get that company to publish the magazine's Indian edition or enter into a licensing arrangement with a local player to produce a facsimile edition), will allow them entry as 'management magazines' (Indian laws allow majority foreign ownership, up to 100 per cent, in special interest publications).

William Adamopoulos for one-the man is the Singapore-based President and Publisher of Forbes Asia-is excited at the prospect of entering the Indian market. "We champion the cause of entrepreneurship," he gushes. "It's the right time for us to be in India now, at a time when Indian entrepreneurs are being cheered by the global community." There are others that share Adamopoulos' enthusiasm for India. Among them is Conde Nast, the us publishing giant with 19 titles in its stable, including Allure, GQ, Vanity Fair, Glamour and Vogue. The company is likely to use the special interest clause and set up a 100 per cent subsidiary; Vogue and Glamour could well be its entry vehicles into the Indian market. "(Our) plans are at an early stage, but Conde Nast is keen on India," says Alex Kuruvilla, formerly head of MTV India and now a consultant to Conde Nast. IDG Inc., a us-based company with some $2.7 billion (Rs 12,150 crore) in revenues and 300 newspapers and magazines in its stable, has already set up a 100 per cent subsidiary, the first for any foreign media firm in India. Two of its magazines, CIO and Outsourcing World, are already in the market. And in August 2005, BBC Worldwide, the third largest magazine publisher in the UK, launched its most popular magazine Top Gear through a joint venture with Bennett, Coleman & Co. Ltd. (the latter's 29 titles, including women's magazine Femina and film magazine Filmfare, are also published by the JV); the company is now looking to launch more titles from its 45-magazine portfolio.

"For a healthy growth, magazines have to reduce their dependence on advertising and push subscription and news-stand sales" Ashish Bagga CEO/Living Media

It isn't just the international magazine publishers that are making a beeline for India; the local firms are in overdrive too. New titles are being launched not just in genres such as news (Outlook Publishing recently launched Newsweek through a distribution arrangement and will soon launch a local edition of women's magazine Marie Claire) and business (the same company also launched business magazine Outlook Business, and has registered another title, Profit), but also in niche segments. Media TransAsia launched a local version of popular laddie magazine Maxim, and Living Media (which publishes Business Today) is all set to launch fitness-for-fitness-buffs magazine Men's Health, management-for-CEOs magazine Harvard Business Review, and Consumers Today, a consumer-oriented publication, and a health and lifestyle magazine, Prevention (it recently launched Scientific American). There are also reports that Business Standard, which publishes the eponymous business daily, is interested in the magazine space where it already boasts a couple of offerings such as Motoring, Asian Management Review, and Indian Management. Then, there are magazines that are being promoted by companies diversifying into the business. Last year, mortgages major HDFC and Forbes Gokak formed a JV that would publish niche magazines; the company has already launched Computeractive and Car and Bike India, both local editions of popular UK magazines. And finally, there are the start-ups. From Money Life, a personal finance and investing magazine brought out by the husband-wife team of Debashish Basu and Sucheta Dalal, to the Time Out series launched by Ruia scion Smiti Ruia's Paprika Media (the Mumbai edition was launched in September 2004; the Delhi edition is work in progress) to really niche magazines on spas and pets (see Niche Is In), news-stands are replete with magazines of all hues.

NICHE IS IN

In magazines, at least, it would seem to be. From music magazine rock street journal (it has been around since 1993 and claims to sell 42,000 copies an issue on average, although media exces insist the actual number is far lower) to newbie Asia Spa India, a spa magazine, special interest magazines continue to thrive. The secret ingredient in their business model: a loyal readership base that doesn't mind paying anything between Rs 50 and Rs 100 per issue; they do attract advertising, but nowhere close to the amount they need to sustain themselves. As Shweta Khurana, Publisher, Dogs and Pups, puts it, "We found that there was a huge demand for a comprehensive magazine on pet parenting in India." Launched in July 2004, the magazine claims a circulation of 10,000 at a cover price of Rs 50 (again, media execs insist the actual circulation is lower). The big media firms will likely turn their noses up at that volume of business, but it works, and is profitable. -Pallavi Srivastava

Who Reads Magazines?

The interest of global firms in the Indian magazine market shouldn't surprise anyone: they are now allowed to access a market, and one which boasts a huge population of English-speaking people. As for the local companies, says Maheshwar Peri, President and Publisher, Outlook Publishing, "Everyone is trying to complete their bouquet." "There are big gaps in the magazine market in terms of the variety and number of product offerings."

That may be the case, but the fact is, the Indian print media reaches just 23 per cent of the population; English publications, 3 per cent, and English magazines, 1.7 per cent. Nor are other numbers, these to do with revenues, any more impressive (see Why Everyone Is Keen On Magazines), with estimates on advertising revenues that contribute 70 per cent of the total revenues of most magazines, ranging from Rs 700 crore to Rs 1,000 crore. According to tam Media Research, the share of magazines in the total print advertising revenues pie has remained static at 12 per cent in the past few years with a marginal upturn towards the end of 2005.

Publishers insist that the numbers are misguiding; they argue that over 200 English language magazines are registered in the country, but that of this number, only 60 have "mass reach" (even if the term is to mean sales of more than 20,000 copies). The top five firms, media planners admit, garner more than 60 per cent of all ad-spends headed for magazines. Even that, however, doesn't explain why everyone suddenly wants to launch a magazine. "The lure of the Indian market lies in future potential, not current size," explains Bhaskar Das, Executive President, BCCL. And so, like companies in businesses ranging from power-turbines to passenger cars, media firms are launching magazines hoping that the market will grow. After all, at a global level, magazines account for almost a fourth of the advertising revenues print attracts, with the corresponding proportion in India being a mere 12 per cent.

"There are big gaps in the magazine market in terms of the variety and number of product offerings" Maheshwar Peri President & Publisher/ Outlook Publishing

Growing Interest

The economy itself, currently on a roll with nary a cloud in sight, is one reason for the interest in magazines. By their very nature, these publications cater to niches, and there would appear to be some correlation between the evolution of an economy and that of the reading habits of consumers. Put simply, that would mean that as an economy grows and becomes more developed, and people become richer and exposed to other cultures, they may want to read things they didn't in the past (for instance, pet owners, at least some fraction of them, may want to read a magazine that exclusively deals with dogs and cats). Piyush Sharma, Associate Publisher and CEO, Maxim, claims that while Media TransAsia hoped to sell around 20,000 copies of its first issue, it actually did 80,000, and with the ratio of advertising pages to editorial pages being a healthy 1:3. And Living Media's Indian edition of Cosmopolitan has built up a circulation of around 100,000. "India has a media-savvy population whose purchasing power is on the rise," says Ian Watson, International Director, BBC Worldwide. "Then, with the entry of the world's leading marketers, a branding culture is taking roots in the country." These two trends, he adds, bode well for magazines "because they thrive on a discerning audience and niche marketers wanting to reach them."

Niche brands, or luxury brands, have long faced this problem (of addressing niches). "There are not enough media vehicles that could match our brand status and cater specifically to our target consumers," says Tikka Shatrujit Singh, Brand Advisor, Louis Vuitton. Even technology firms, that use business magazines for their CEO-targeted advertising, prefer special interest magazines when they seek to address CIOs or technology managers. "IBM, hp, Mercury, Cisco, Juniper, are all regular advertisers on CIO, ever since we launched it," says Bringi Dev, President, IDG Media. Thus, new magazines, at least some of them, could well tap a new market for advertising revenues, helping them grow, and grow faster than media dependent on traditional sources of advertising revenues. "New media platforms attract a new set of advertisers," says C.V.L. Srinivas, Managing Director, Maxus, a media buying agency. "This is what happened on TV where general news channels attracted local advertisers and business channels, financial institutions that had never advertised on TV." Evidence supporting this hypothesis comes from the experience of Cyber Media, a company with a dozen-odd speciality technology magazines. Over the past four to five years, claims Shyam Malhotra, Executive Director, Cyber Media, the company's advertising revenues have grown 25-30 per cent CAGR or compounded annual growth rate (the comparable figure for the industry is 12 per cent). "This revenue came in entirely from advertisers that didn't advertise until we came in."

THE 'OTHER' MAGAZINE BUSINESS

Circulation-led: And Nath isn't complaining Paresh Nath publishes 26 magazines in nine languages. One of his titles, Saras Salil, targeted at teenagers and published in five languages, sells more than a million copies (readership: 14 million) in Hindi alone. Grihshobha, another magazine from his stable, published in eight languages, is the market leader in Hindi, Marathi and Gujarati markets and among the top five magazines in Tamil, Telugu, Kannada, Malyalam and Bengali. Going by the basic principle that advertising bucks follow eyeballs, one would expect a queue of media buyers outside Nath's office. But that's not the case. "Most of our magazines survive on their cover price and we survive pretty well," says the President and Publisher of Delhi Press Patra Prakashan. "Besides, all our titles are sold through news-stands unlike English publications that are subscription-led," he says. This is the story of vernacular magazines across the country. And, it highlights a strange dichotomy in Indian market: on the one hand, English publications survive on advertising revenue because of a minuscule readership base; on the other, regional publications have to make do with sales revenue because of a smaller advertising market. According to estimates, the total advertising opportunity for over 100 regional magazines is around Rs 200 crore and more than 50 per cent of this goes to Hindi, Malyalam, Tamil and Bengali publications. The argument of media buyers is that advertising is a function of socio-economic status of consumers that these magazines reach. Still, the circulation-led business model of these magazines affirms the fact that if consumers get what they want, they would most willingly pay for it.

Boom In The Offing

India, all media companies chorus, is poised on the threshold of a media boom with magazines looking to benefit the most from it, perhaps even more than television channels. India, after all, is one of the few markets in the world where print media, at 16 per cent in 2005, is growing faster than its electronic counterpart (11 per cent). In 2005, print's share in the total advertising pie was 48 per cent against TV's 41 per cent. Most people expect print to keep growing faster than television, at 15 per cent or 17 per cent, with magazines growing even faster, by 30 per cent or 40 per cent. "There is too much clutter on television," says Sandeep Vij, President, Mudra Communications. "TV and newspapers remain a mass medium while magazines cater to specific demographics or interest groups and are hence better targeted."

If there is space to grow in the magazines business, it is also because there aren't too many of the kind around. The US, for instance, has 1,800 magazines serving a population of 320 million. India, with an English-speaking population of around 300 million, has a mere 200 English-language magazines. Through the 1990s and the early 2000s, everyone, consumers, media firms, advertisers, was focussed on television. "The advent of cable and satellite television distracted advertisers," says Smita Jha, Principal Consultant (Entertainment and Media Practice), PWC. "Readership was also not growing much and conditions weren't too conducive for magazines."

The media firms themselves seem to have realised the merits of magazines. Sharply focussed magazines (and not me-too general interest or business magazines) deliver a better return on investment to companies than, say, newspapers or TV channels (it also costs much more to start-up either of the latter). To really succeed in the business, however, companies will have to grow their revenues from circulation. The ratio of circulation revenues to advertising revenues is around 50:50 in the First World; it is 30:70 in India. That worries Ashish Bagga, CEO, Living Media. "For a healthy growth, magazines have to reduce their dependence on advertising and push subscription and news-stand sales." They could do this by increasing "cover prices or building a loyal base of readers," says BCCL's Das. Bagga believes content is the key to attracting both readers and advertisers. "If you give consumers what they want, there is no reason they would want to leave you."