Computer Publishing: Go Online or Go Home

Revenue growth from Web sites run by computer publishers outstripped all other segments of the US computer publishing market in 1999, according to a report by Simba Information Inc.

The online segment of the computer publishing industry grew at 34.3 percent from 1998 to 1999, according to Simba’s Computer Publishing Market Forecast 2000. The entire US computer publishing market reached $3.195 billion in 1999.

Although the online segment represents the second-smallest part of the market, it is growing much more rapidly than the other three segments — computer magazines/newspapers; computer books; and newsletters, journals, and miscellaneous periodicals. According to Simba, online market growth in the computer publishing industry is being driven primarily by an increasing share of advertising dollars, and is projected to continue posting double-digit growth for the next two years.

The largest segment of the computer publishing industry, magazines and newspapers, has been waging the toughest struggle for growth within the industry over the past two years as advertisers have sought to broaden the reach of their messages beyond the traditional computer press. In 1998, estimated net revenues dipped 7.3 percent to $1.6 billion, and in 1999, revenues plunged another 9 percent to an estimated $1.46 billion. According to Simba’s projections, 2000 will be another year of declining revenues for the publishers of computer magazines and newspapers, though not as bad as the two previous years. The market should see a modest rebound in 2001.

The computer book market turned out to be a bright spot in 1999, with revenues breaking the $1 billion mark for the first time, up 10 percent from 1998. Publishers are putting a greater emphasis on more advanced titles rather than the low-end books that were so popular several years ago, and have worked out problems associated with over-publishing, according to the report. The convenience of ordering books over the Internet has also been a help to that industry segment, the report found. Computer book revenues are forecast to grow 12 percent in 2000.

The smallest and slowest-growing segment of the market — newsletters, journals, and miscellaneous periodicals — is forecast to remain relatively flat in 2000, but then grow 2.6 percent in 2001, falling victim to the increasing shift to online and electronic formats.

Overall, the US computer publishing industry is forecast to pick up the pace in 2000, growing 6.8 percent to $3.413 billion, with the magazine and book segments continuing to dominate the industry. In 2001, the industry is projected to grow 7.5 percent to $3.668 billion.

“Although growth has slowed in recent years, the US computer publishing industry remains strong,” said Linda Kopp, executive editor and co-author of the report. “The book and online segments posted particularly solid growth in 1999, and it appears that the business/tech hybrid magazines launched over the past two to three years, such as IDG’s The Industry Standard and Imagine Media’s Business 2.0, are just one avenue through which magazine and newspaper publishers are beginning to win back some of the ad pages lost to outside media.”

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