ACCC voices concerns over Bauer’s $40m Pacific Magazines buyout
The deal between German-owned Bauer Media and Seven’s Pacific Magazines has hit its first hurdle, with the Australian Competition and Consumer Commission (ACCC) voicing its concerns, particularly around how it will impact the viability of both publishers’ weekly titles.
Woman’s Day and New Idea, along with Take 5 and That’s Life were the four titles named in the announcement from the ACCC, with the commission saying they are direct competitors and the deal would thus remove competition from the market.
ACCC chair Rod Sims isn’t satisfied by the initial review of the Bauer Media and Pacific deal
They really haven’t considered the impact of social media on the specific categories they have mentioned, ie Woman’s Day New Idea etc. And these preliminary concerns are to the detriment of the magazine publishing industry by denying obvious cost and productivity synergies, and is in fact an anti-competitive decision.
It is painstakingly clear that the real competition posed to publishers of these titles are in clawing back both retail sales and advertising revenue lost to Facebook et all, and for ACCC to require another round of submissions on whether magazine content of these categories are replaceable with digital ones (arguably the most replaceable categories, really) is just a pure waste of tax payer dollars.
What an absolute, rolled gold farce. The once loyal staff at Pacific have really been dragged through the s*** throughout this appalling and now seemingly botched deal. The betrayal and now the incompetency – which is the worst taste that’s been left for the staff to savour over Christmas?
This is the worst outcome for the poor people at Pacific who are now spending another three months in the unknown before finding out the fate of their jobs.
….One could say the same thing about the staff umm’ing and ahh’ing about whether to stay.
Just update your CV already!
(Seriously, they can go to somewhere like News Corp, where there is plenty of room for mag salespeople. Bonus, they also get trained in the brave new world of “digi”)
However, there appears to be only a few websites that offer the same or similar combination of content, including Australian content, as the parties’ magazines. Websites that offer such content include Mamamia and With Her In Mind (whimn.com.au).
General news or media websites, such as news.com.au, also contain similar content. Overseas websites and content suppliers do not tend to cover Australian content, and are not written specifically for Australian audiences (eg, referring to overseas television shows or pop culture, using US spelling, referring to overseas currency or brands, etc).
The ACCC’s preliminary view is that most of these sites exert a low degree of constraint on Woman’s Day and New Idea, compared to the constraint that those titles impose on each other.
The ACCC understands that advertising revenue makes up a relatively small proportion of revenue for the titles, and so is of the preliminary view that further loss of advertising revenue is unlikely to act as a very significant constraint on a combined Bauer-Pacific Magazines.
The ACCC therefore considers that the proposed acquisition is likely to
substantially lessen competition in relation to the supply of content to
consumers/readers of Woman’s Day and New Idea. The proposed acquisition is likely to:
reduce the frequency or value of gifts or promotions with magazine
purchases;
reduce the investment made in producing content; and/or
increase magazine cover prices for consumers.
The ACCC invites comments from market participants on the following:
The extent to which consumers consider online content suppliers and social media as a substitute for the parties’ print magazine titles, and the proportion of readers for whom online content is not a substitute.
The extent to which consumers consider other alternative magazines or onlinecontent that only covers some of the topics covered by the relevant magazines as substitutes for the parties’ titles.
The importance to consumers of Australian content.
The extent to which readers consider online sources or magazine titles in other categories which only contain part of the content in mag
“Most of these sites exert a low degree of constraint on Woman’s Day and New Idea…”
Hahahhahahaha!
Thanks for your comment, Mr Sims!
You should become the CEO of a media company with that sort of vision
There are puzzle mags, there are real life stories mags, but there is no body else apart from Take5 & That’s Life that has both Real Life stories and Puzzles in the one package.
There are online competitors (Buzzfeed, Daily Mail, News.com.au etc) BUT THEY DON’T HAVE PUZZLES
ACCC wants to know if the consumer would consider other real life stories online & offline – a suitable substitute despite the absence of puzzles.
ACCC is puzzling at best.
The ACCC should save themselves some hassle and focus on industries that will still exist in five years.
The great unstated impact of this whole sale fiasco is that Pacific is now going to lose a large chunk of its very best and brightest staff over the next few months, they are all now in the advanced stages of getting new work and putting this train wreck betrayal behind them.
There is going to be a mass exodus of the people who generated most of the money for the company. The innovators, the people who went the extra mile, the people who had once given their loyalty for Pacific.
The loyalty is now gone forever and all that will be left is empty titles and brands. Good luck Pacific, you are going to need it.
Pacific isn’t an isolated case … plenty of talented staff have gone from Bauer, Fairfax, News Ltd and others. As for loyalty, are you kidding? Every magazine or news publisher in the last decade did diddly squat to keep staff no matter how many years of “loyalty”.
The poor Pacific magazines staff! So happy with their redundancies (especially since Bauer decided not to take the best and the brightest) sitting pretty waiting for it.. stopped in their tracks because of this ridiculous decision. Now not only do they have to wait for a redundancy (if any) or even worse work out their very long 9 week notice periods before they can even start a new job! An absolute JOKE and nightmare. Pull that pin ACCC you are going to kill both companies in the meantime
Poor staff is right.. not only are there no bonuses, no redundancies but now the competitor have been given access to all the IP. But yet the expectation will be to come back and continue business as usual, with half the staff, none of the innovators all with a smile! Good luck they will need indeed
What’s the alternative to the merger ACCC? Both businesses winding up their magazines??????
You do realise that the major weeklies continue to sell very well and generate millions of dollars in revenue a year?
Yes, sales are declining and the *long term* prospects for any mass market print media is terminal, but can we cut the ridiculous dismissal of this still highly lucrative, relevant and widely read sector?
Once New Idea and Woman’s Day are under the same roof the competive pressure is gone and the quality of contents will collapse. Whether you or anyone else who doesn’t consume mags think the quality is any good right now is totally irrelevant. These mags DO drive the celeb news agenda in Australia and everyone else follows.
Let’s see where the Daily Mail (especially) and the News Ltd sites get their local celeb content once these mags are eventually gone, since their Mondays are currently consumed with ripping the entire contents of the mags.
Wow. This is a seriously bad take. You do realise…
1. Plenty of mags make millions in revenue, but ZERO profit. That’s why they’re all closing along with most print media
2. There is nothing “lucrative” about the mags in question, category or industry. Let’s look at the facts; most advertisers have abandoned the medium (forecast to be <1% of total ad spend) and category, and print readership for the mags has plummeted. Importantly, the value people are willing to pay for magazine businesses has cratered over 90% and again, will continue to decline
3. If the ACCC does not approve, the mags will likely shut down a lot faster than if it did so you needn't worry about supposed deterioration of quality of something that doesn't exist; you won't be seeing your 'lucrative', 'agenda setting' magazines for long
Perhaps you can scrap together a few dollars and buy these gems yourself, I'm sure you'll get a good price
I’m so sorry that this deal that so many have bet so much of their careers on getting across the line has abysmally failed. The ACCC is NOT going to pass it and now you are left with a Pac Mags where literally ALL the key staff now want out, ASAP. Maybe certain people should instead concentrate on saving Seven because the shows that are lined up for 2020 are all bloody awful – and there is that little matter of Seven not having a streaming service in an age when broadcast tv is the walking dead. So Seven, get busy rearranging some deck chairs on the Titanic that is your archaic tv “empire” and maybe leave what’s left of Pac Mags to die in peace and dignity after your despicable betrayal of the staff.
There is AFAIK only one pianola roll manufacturer in Australia – why isn’t the ACCC investigating this as well ?