CD-ROM titles fail to catch fire

Folio: The Magazine for Magazine Management, August 1, 1995 by Lorne Manly

Publishers of consumer magazines in CD-ROM format are seeing the first signs of fallout in their market. Some titles have already closed up shop, while others are drastically altering their plans. Nonetheless, despite distribution bottlenecks, advertising obstacles and technology limitations, new CD-ROM-based titles are sprouting up - each promising to possess the magic multimedia formula to capture the market's loyalty.

One of the pioneers in the periodicals CD-ROM market, substance.diginized, crumbled this spring because of a lack of business expertise and internal bickering, insiders say. Medio Multimedia, which publishes the monthly Medio Magazine, recently laid off half of its 80-person staff after negotiations for a round of financing collapsed; the Redmond, Washington-based company will probably scale back the electronic tide to a bimonthly frequency later this summer. Ziff-Davis Publishing has scrapped its plans for a subscription-based quarterly CD-ROM for Computer Life, instead opting for CD-ROM cover mounts. And Newsweek reversed direction on its quarterly CD-ROM last year to concentrate on the magazine's online area on Prodigy.

Critics claim that CD-ROM magazines deliver the worst of both worlds: Print titles provide better-looking graphics, while online publications offer the interaction and current information consumers demand. As for the multimedia component that proponents say is their killer application: "It's kind of cool, but you get over the cool factor very quickly," says Jay Moses, senior vice president for New York City-based BMG interactive and former director of multimedia at Times Mirror Magazines. "The computer is a lousy way to listen to music and a lousy way to look at video."

The other major drawback is the economic model. "The consumer market is not used to paying for CD-ROMs," notes Sherry Huss, director of electronic publishing for the consumer media group at Ziff-Davis. Huss says that the company needed 100,000 subscribers to make the economics viable for a quarterly Computer Life CD-ROM. But the company's testing conservatively predicted a paid-circulation title would top out near 40,000. By cover-mounting single-topic CD-ROMs, the magazine can now guarantee distribution of 300,000.

Newcomers are undeterred

Business-oriented titles seem to have a better shot at success. Ziff's PC Magazine, for example, sells 120,000 copies of its quarterly CD-ROM. Newcomers on the consumer side can't match that - but they are undeterred nonetheless.

Pop-culture title Blender, which reported a 65 percent sell-through on its first issue last fall (6,500 copies), distributed its third issue in June. Trouble & Attitude, a discazine targeting young men, appeared the same month (see "Trouble coming to newsstands," Folio:, April 15, 1995, page 18). The upstart is one of several trying to move beyond software stores by packaging themselves for newsstand distribution.

Other new CD-ROM-only magazines include Launch which covers, the music scene, and Go Digital, which bills itself as a cross between Wired and Penthouse. On tap for this fall: a lifestyle title called Living Home.