Print Magazines Take on the Interactive Challenge

Electronic Gaming Business, April 7, 2004

Many print magazines in the gaming segment enjoyed circulation gains in the second half of 2003, according to the Audit Bureau of Circulation. Only Tips and Tricks and GamePro saw declines during the game-buying half of the year when most books in the category enjoy a bump.

Despite several major games Web sites claiming substantial ad spending growth, Andy Swanson, publisher, Future Network USA Games Group, says ad pages were up year over for his three titles, PC Gamer, PSM, and Official Xbox Magazine, and he is not feeling the heat from online quite yet. "People are still supporting print ads as a foundation buy," he says, and many middle tier players just can't afford to burn their budgets on TV buys.

Which is not to say that print is immune to the industry's natural cycles, like the expected drop-off in gamer interest before the transition to the next generation of consoles. "Ad pages are going to drop, so it will be a challenge to maintain the rate base. This is something we all know," says Swanson. Like game publishers, he is hoping that the next-gen handhelds (Sony PSP, Nintendo DS) will help prop game industry revenues and ad dollars during the transition. Citing good performance from PC Gamer despite declining game sales on the platform, he thinks the PC side, too, will be a hedge against a transition depression.

Swanson thinks that cross-platform magazine titles are at the greatest risk of losing advertising because of a diffused focus. New titles like Ziff Davis's GMR and one-offs like Stuff Gamer are going after an ad pool that has not really grown much. "Everybody thinks there is a lot of money to be had. People are just trying to get into the space without thinking about it," he says.

Future's strategy is to stay platform specific with its titles in order to maintain a more targeted audience than cross-platform mags and the major Web game destinations. For all of the Web's ubiquity and immediacy, print still gets gamers' focused attention. "Our readers spend two to three hours going through the magazine," he says, and 90% say they have purchased something they have read about in their pages.

Swanson also sees the packed-in demo discs as critical to print, especially in titles like Official Xbox. Not only do gamers get to play the games but the magazine can carve out a branded space around a game title for the marketer in a way that isn't possible from online downloadable demos. While only PC Gamer and Official Xbox titles come with demo discs, Future also issued six DVD pack-ins with its PSM title last year.

The technology and models being discussed for the next generation of game consoles could ultimately threaten the special value proposition of magazine game discs. Both Microsoft and Sony are exploring how downloadable game add-ons, demos and games themselves could be pulled directly onto their next generation of consoles. When that day comes, Swanson says, he will not be alone in trying to figure out his next move. "Downloadable [console] content is a question that is going to affect everyone."

Contact: Andy Swanson, 415/656-8749, aswanson@futurenetworkusa.com

[Copyright 2004 PBI Media, LLC. All rights reserved.]