"It doesn't take a genius to look at the ABCs this year to know things are changing.
"You hear PR coming out saying this is cyclical or it is a downturn in advertising or it is to do with the trend in weeklies.
"Frankly, I think a large part of what is happening is because of the web, it has finally started to grow commercial teeth, its bite is becoming as bad as its bark," said Jeremy Tapp.
Tapp and his business partner Adam Laird co-founded Magicalia seven years ago. Since then the online publisher has grown from producing just a single specialist online cycling publication to being home to 40 specialist website communities.
Publishing focus for the company is predominantly on outdoor activities, appealing to enthusiasts with titles such as: SURFmagic, RoadCyclingUK and TheMainSail.
Its rapid success in developing online communities has brought the firm attention from big magazine publishers keen to quickly sort out their online activities.
However, last month Magicalia spurned their advances, instead buying Encanta Media for £2.72 million to get its hands on its woodworking, modelling, patchwork and gardening magazines and initiate its move from solely digital into duel publishing.
"A lot of people say web is important to their magazines but what they really mean is that it is a defensive action, essentially 'how do we deal with this thing that we would rather not deal with,' by which they mean the ingress of something that changes their world.
"We are sort of coming at it from another angle because we are saying we're all about that change, we are all about behaving well in that world.
"We recognise that magazines are fabulous and have a deep connection with readers, a permanent connection with readers and advertisers, and we want to do that too.
"The fully evolved cross-media company in a couple or three years time will be seamless and will have skills in both those worlds. Neither party has them at the moment, but that is what we are trying to create, the first proper cross-media company. I don't believe that anyone has got that nailed yet."
According to Tapp the fundamental differences between the Magicalia approach and the general replication of print magazines online is that it places the user and technology at the core. Many of Magicalia's sites have up to 95 per cent of their content supplied by the users.
"We blur the boundary, its clear which articles are written by our editorial staff and which are written by our members, but we don't have that strong boundary of them and us that traditional print publications promote.
"We don't have that at all, we are much more 'here is our opinion and we would like your opinion alongside it.'
"In each of our markets the collective intelligence of all of our readers is far higher than we could amass centrally."
Tapp added that he believed the key to success for an online magazine is to be responsive to the need of the community it serves and involve them fully through using sophisticated integrating technology.
"It's one thing to have a forum, a great big dirty forum board where you can discuss stuff and maybe it has a search function.
"It's another thing to have a forum that is integrated into the content, to different articles, and integrated around the different product features.
"It is this technical competence and technical platform that we think other people aren't close to yet."
Publishing online and having a sturdy technological base has allowed Magicalia to launch titles that would not otherwise survive in print and attract several small audience groups that when combined offer a powerful advertising bait.
"Without the cost of distribution, without the cost of paper, we can reach into a smaller niche, She Cycles for example - I don't think that could ever be supported as a newsstand title in its own right, it's not likely that you could launch a woman only cycling magazine in the UK.
"Because of the cut off point of the minimum economic scale of a magazine, because when you do a print run there are distribution losses, you need magazines that are certainly above 10,000 circulation. Above 20,000 circulation before they start making proper sense. If you pick super niches then they are not going to hit that scale.
"For us they are cheaper to launch, it's just the technology costs, and we already have a platform for launching websites efficiently, and the cost of a small staff . . . so it is easier for us to experiment."
The company launched five sites in 2004, and in 2005 launched four more. It is currently working toward a launch of web communities to complement its recently acquired print titles.
Despite the obvious importance of the web Tapp belives that some companies are failing to adapt quick enough to grab hold of a potential online readership and leaving a void being filled by new companies intent on becoming the major players.
Magicalia, one of these new companies, is already profitable from advertising alone. it also has plans to take advantage of its niche sites and develop subscription services for its specialist readership, even though newspaper publishers have seemingly dispensed with that model.
"Getting money out of readers for content when there is high quality content available for free on the website next door is always going to be difficult.
"But if you can create a really high quality property online that has a lot of reader loyalty, that locks up some of its content while running the balance and retaining that loyalty, there is scope to make money.
"You have to create an environment that is really high quality if you are going to do that, the reason that we have not done it yet is for precisely that difficulty. It's a new world and people are still scrambling for market share.
"That's also one of the reasons that it has been difficult for print companies, as there is not too much of an incentive to move online as you can't make money off the readers very easily or not as easily.
"But in a mature world in five to ten years time will the best web properties make money off their readers in various ways?
"I think probably they will."
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