Opinion

A CEO downgrade? What would the PacMags boss appointment say about the future of the company?

Finding a replacement for one of the big characters of the magazine industry was always going to be a big ask for Pacific Magazines. Even more so, because Peter Zavecz’s successor may well find him or herself in a diminished role, predicts Mumbrella’s Miranda Ward.

While speculation is rife as to who Seven West Media will tap to replace Pacific Magazines’ boss Peter Zavecz – a bigger question is around the structure SWM will adopt: will the company appoint a CEO or a managing director, and what does that suggest for the future of PacMags?

Gereurd Roberts, Pacific Magazines’ general manager of food, family and home, is the name most commonly being bandied around for the top job.

Gereurd Roberts

Will Gereurd Roberts succeed Peter Zavecz?

Unfortunately for Roberts, it comes at a time when the print sector, and magazines in particular, have hit an all-time low, leaving PacMags as a much diminished division within the SWM portfolio.

As a result, informed observers believe that SWM will downgrade the CEO role to MD.

The fact there was no immediate announcement for a successor – despite it long being telegraphed in the market that Zavecz was likely to leave to return to Melbourne for family reasons – may also suggest that SWM is considering external candidates.

Roberts’ experience appears to make him the best internal candidate, particularly after Marie Claire stalwart Jackie Frank, recently promoted to GM of fashion, beauty and health, publicly ruled herself out. Other contenders might include Prue Cox, who joined from NewsLifeMedia as commercial director about six weeks ago.

Roberts began his career with Pacific Magazines in 2008 as editor-in-chief of Famous (after a stint at Bauer’s NW) before getting more exposure to the commercial side of the business after being promoted to publisher of the title in July 2011.

Roberts was then promoted to the role of commercial director in January 2014 and in May this year was promoted to the role of general manager of food, family and home, with NewsLifeMedia’s Prue Cox taking on the commercial director position.

PacMags-CEO-Peter-Zavecz

There is also precedent for the PacMags CEO role being left empty. When Nick Chan left in 2013 to take on another SWM role as chief operating officer, Zavecz was appointed initially as director of magazines. He officially got the CEO position 14 months later following the departure of Chan – who later turned up as the new boss of Bauer Media – from SWM.

This time round, if the CEO role is left empty it may be taken as a more significant signal to the market about SWM’s ambitions for PacMags.

Earlier this month, SWM’s update to the market revealed that Pacific Magazines saw a big drop in revenues in the past financial year – falling from $220.1m last year to $201.2m, with a profit of just $9m.

The latest set of audited magazine sales numbers suggests that the whole magazine industry is in transition, with the age of the glossies arguably now at an end.

Seven West’s own focus on launching digital properties aligned to SWM in their own right – rather than through Pacific Magazines – suggests the entire magazine arm could be for sale awaiting the right buyer (at hopefully the right price) to come along, while SWM remains in digital publishing.

Screen Shot 2016-08-30 at 10.40.48 am

SWM launched Foodiful at the end of July – let’s be clear, it was a SWM launch, not a PacMags launch. While PacMags is involved, the brand is sitting clearly within the SWM part of the business, as is 7Travel which SWM launched earlier this month.

Another complicating factor is Seven’s digital joint-venture with Yahoo, Yahoo7 – an alliance that may be coming to an end thanks to the sale of the Yahoo assets in the US to Verizon last month.

It’s a strategy not that dissimilar to Nine.

In 2012, Nine sold off ACP Magazines to German publishing company Bauer Media for a total of $525m.

Nine.com.au logo

Nine also unwound its joint-venture with Microsoft, nineMSN and launched the likes of Honey, Pickle, 9Kitchen, Coach, Elsewhere – a series of lifestyle-based content platforms. It also rebranded its main news site Ninemsn to Nine.com.au.

Meanwhile, the share market has responded favourably to APN News & Media’s decision to get out of the print business, with the agreement to sell its regional newspapers – at a bargain $36.6m – to News Corp.

If this is the future for Pacific Magazines, it means that the boss of Pacific Magazines will need to be someone who could help a sale go through.

Monopoly issues aside, Bauer would seem a logical acquirer at the right price.

If it’s going to be a case of the last man standing (although News Corp would have something to say about it), the obvious home for the PacMags titles would be Bauer Media and newly arrived boss, Chan.Nick-Chan

And Nick Chan, according to industry insiders, was a big supporter of Roberts, suggesting any such transition might be a smooth one.

Indeed, Roberts’ own career path has been similar to the one trod by Chan.

Chan was a publisher of now-defunct Famous magazine, of which Roberts was editor-in-chief before becoming publisher before his promotion to commercial director in January 2014.

And if the right buyer doesn’t come along, SWM will still have the CEO position up its sleeve, retaining the ability to hire someone in over Roberts if management’s concerns around his lack of business or strategic experience still stand.

Given all the challenges facing traditional media companies, the question that remains is: Is boss of PacMags even that attractive a job?

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