FIPP 09: Guardian.co.uk not yet profitable, but B2B must make money, says GMG chief exec

'B2B is not immune, but it's resilient', Guardian Media Group chief executive, Carolyn McCall told delegates at the World Magazine Congress 2009 today, commenting on the impact of the current economic crisis on the media.
 
Whilst Guardian.co.uk has not yet reached profitability, McCall - who earlier this year announced she would forego her 2008/9 bonus - said Guardian Jobs and the group's B2B ventures, such as its stake in Trader Media Group - were making good digital revenue for the company. 

McCall, who was participating in a panel looking at global economic and media trends and 'riding the storm', said it would be a 'long and painful' recovery for magazines: "I don't think it will bounce back in the way it went," she added. 

While a subscription model for news has been touted by some commentators as a solution for providers, GMG's news arm was not suited to a subscription model, she said. 

Charging for all online content is 'very unlikely', though making some specialist areas of Guardian.co.uk subscription-only is something the group should begin to think about, she said.

"Unless the BBC starts charging for content [...] it's [charging] very difficult to do so," she added. 

With regards to the newspaper industry's revenues, McCall said 'regionals have been hammered' by a business model based on earnings from classified advertising rather than verticals.

In contrast the success of Trader Media Group's Auto Trader is because the publication moves quickly in response to new technology and serves a niche audience, she said.

Applications, such as a desktop feature, have made it a lucrative service, although it does face competition from online rivals, such as eBay, she added.

The Guardian Media Group's B2B ventures must make money she said, otherwise the group wouldn't be 'doing much B2B content online'. 

"I don't think [magazine revenue] margins will return to where they were and I think [it will be] a long time for revenues to return to where they were," added fellow panelist John Smith, chief executive of BBC Worldwide.

Smith said there will be an increasing focus on paid content: BBC Worldwide content now accounts for two per cent of sales via iTunes - for example, he said.  

But William Kerr, chairman of the board for US publisher, Meredith Corporation, said the industry should not lose sight of its 'heart and soul'.

"We are going to be destroying trees for a long time after this (...) Technology is a change we have to deal with and exploit," he told the delegates, adding that he agreed with McCall that technology was an 'enabler' for magazine companies.

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