Whereas in previous years, finding good local partners (think in-market logistics, for instance) was an imperative, brand owners now have the option to develop international cross-border business without the need of a local partner.
However, that does not mean the need for local partnerships is dead – far from it.
- Take for example two pureplay media companies who will be on stage at the FIPP World Congress – Huffington Post and POLITICO – and consider their partnering with “legacy” media companies in their internationalisation drives.
- Take for example Burda International with its successful vertical, 360º model to brand licensing (they will also share insights into the model – and how it works in different market “types” – at the Congress).
- And take for example new cross-border developments such as online video syndication services.
John Cabell is the founder and CEO of Cue Ball, advisors and brokers to the global media, communications and entertainment industries. He will host a panel at the FIPP World Congress dedicated to the topic of internationalisation, with panelists including:
- Axel Springer
- Business Insider
- Meredith Corporation
- Time Out International
The FIPP World Congress takes place from 13-15 October 2015 and includes the Worldwide Media Marketplace on the 13th (FIPP’s annual event designed specifically as a platform for executives from around the world to talk about licensing, syndication and partnering – and do business).
To call John an expert in international business will be an understatement. Cue Ball has worked with 130 clients in 19 countries and brokered more than 400 deals since its inception in 1997. Below, he shares the latest trends in cross-border licensing, JVs, M&As, divestitures, and strategic partnerships…
What trends have you seen in cross-border (media) business in recent years, as the digital/web revolution has changed how businesses can operate and broadcast across borders?
The trends we’re seeing in the type of cross-border deals we’re involved with are really mimicking what’s going on across the industry. There has been a notable decline in cross-border print deals, for example, reflecting the decline in local magazine launches almost everywhere. Of course, dominant brands in certain categories, such as Vogue in fashion, still have cross-border print opportunities. But, as you might expect, there’s a clear trend towards digital-led or digital-only transactions. Often, when there’s a print element, the local publisher is publishing with lesser frequency – saving on expense but retaining the value of print as the best brand-building tool.
What impact has these trends had on how deals are done?
The emergence of digital has enhanced the value of good content. Licensee publishers are ravenous for good content across all platforms, so licensor publishers need to be concerned about contributor rights – making sure they have rights to use content anywhere, anytime, and across all platforms. The old cross-border model of a magazine leading with print is long-gone. Nowadays, publishers need to be very clear about how they enter markets, and with whom.
What do these changes mean for the future of your industry? What does tomorrow’s cross-border market look like?
First of all, I believe that there will be fewer traditional players going forward, and that the ones who survive will be bigger and more dominant in their segments. I also think we will see new players entering the market: entrepreneurs, digital companies, marketing/advertising companies and financial concerns, to name a few. Lastly, future cross-border activity will very much depend on what is working in each foreign market and what assets the outbound publisher could leverage … and, of course, the list of interested local partners.
Are you seeing different trends from segment to segment – such as mass versus verticals, for example?
Segments such as news, business and finance, and entertainment/gossip – most with weekly or fortnightly frequency – have suffered a lot in print. The immediacy of the online world has made many magazine brands irrelevant in print format – so these brands have either changed or died. Fashion and design brands, for example, have generally fared better. Readers of these titles have a great appetite for high production values and their advertisers continue to be print-centric in their buys.
Specialist titles also continue to perform well. Of course, they have loyal, well-defined audiences and endemic advertisers – and the challenge for publishers has been to provide multiple engagement points for both, whether it be events, online, mobile, or video.
Are there segments that better lend themselves to ‘going it alone’ versus partnerships/licenses?
Even in the so-called borderless Internet world, there are a number of limiting factors to success that make it difficult to ‘go it alone’, as it were – factors such as: language; technology; content localization; and monetization of foreign traffic. Generally, content of global interest and/or of an evergreen nature – in English – could be successful in generating audience. Ultimately, however, the business will need to localize the business model to reach a reasonable level of local profitability. That said, one notable exception is Meredith’s Allrecipes brand, the world’s leading recipe site with 16 local-language sites around the globe. Currently, the entire business is managed and operated out of its Seattle headquarters.
Given the complexity and many options around cross-border publishing today, what’s your advice to those looking at entering the market?
It’s true that there’s no longer a ‘correct’ or standardised licensing formula. In today’s and tomorrow’s worlds, globally-minded publishers will succeed by being open-minded about market entry strategy, by considering a variety of partners (traditional and new), and by deploying all of their assets across borders. Partnering will continue to be necessary for success.
What trends are you seeing specifically around M&A at the moment?
We’re seeing more consolidation in the magazine industry. Burda, Bauer and Meredith have all been active with acquisitions, and we hear and sense that M&A activity will increase further in most media sectors. Giant cash-rich Internet players such as Facebook, Google, Alibaba and Tencent are paying huge premiums for companies that complement their existing businesses. And, we expect to see more cross-media activity as well – such as the recent deal that saw Verizon acquire AOL.
You’ll be hosting a panel discussion on this topic at the FIPP World Congress later this year. Who will be on the panel and what can you tell us about their expertise?
David Woodley is the international managing director for Time Out. With a background in the telecom industry, he has overseen the global re-engineering of Time Out from a print-based brand to a digital one. Julie Hansen is President & COO of BusinessInsider, one of the hottest pureplay digital media brands in the world at the moment. Julie started in the print world, most recently with Conde Nast. Mike Lovell is Director of International for Meredith, one of the world’s most progressive legacy media groups. Meredith has skillfully deployed its various assets – brands, content, services, platforms – in creative ways across foreign markets. Hans Hamer is head of the automotive portfolio (such as Auto Bild) at Axel Springer. Hans’ foreign portfolio probably has been less affected than most, but it will be interesting to hear the differences from market-to-market. So I think their credentials speak for themselves and it will be a thorough and insightful session.
And if you are interested in meeting potential licensing, syndication and other partners…do not miss the Worldwide Media Marketplace in Toronto (it runs on 13 October, the day before the main Congress programme starts).
FIPP reports on all types of international magazine media and other relevant launches in the launches news section on FIPP.com, as well as in a launch section the MagWorld newsletter (subscribe to it here).
More about Cabell
John Cabell is the founder and CEO of Cue Ball, advisors and brokers to the global publishing, media, marketing and entertainment industries. Cue Ball’s core practice is the brokerage and development of cross border media through licenses, joint ventures, mergers, acquisitions, divestitures, and strategic partnerships.
The group has worked with 130 clients in 19 countries and brokered more than 400 deals since its inception in 1997.
Clients include large diversified enterprises such as Bloomberg, BBC Worldwide, Meredith, American Express, Bonnier, Gruner + Jahr, Hachette Filipacchi, Playboy, Editora Abril, and Hubert Burda Media … specialist publishers such as Active Interest Media, Citizen K, Time Out Group, Harvard Business Review, Outside, The Economist, Surface, and Future … and pure-play digital media such as BusinessInsider, Allrecipes, and genConnect. Cue Ball has also worked as an M & A advisor to clients and investment banks; more recently, it is working on angel and venture capital fund-raising with early- and growth-stage companies.
John and his business partner, Mike Greehan, are co-authors of the International Magazine Media Handbook published by FIPP. Prior to founding Cue Ball, John was the publishing director of Women’s Sports at Sports & Fitness Publishing. From 1991 – 1995, he was the director of international development for Rodale Inc. he began his media career in 1977 as an account executive for MCA-owned New Times Magazine. From then until 1991, he served in various sales, marketing and management positions for Ziff Davis, CBS and Rodale.
He was a nationally ranked distance runner during his school, college and post-college years from 1972 – 1982, and is a 1977 graduate of Princeton University (B.A. Economics).