FIPP 2002's theme: Magazine Media Welcomes the Digital Age: Making Technology Work for Magazines Session VI-A - 14:45-15:45 Thursday 18 April 2002 Challenges To the Future of Magazine Distribution in the Asia-Pacific region FIPP Conference Seoul Korea

Introduction to the Session Overview of the theme in relation to the Asia-Pacific region. Presentation by Speakers of their own markets and trends in these markets (13 mn each) Session: Challenges To the Future of Magazine Distribution in the Asia-Pacific region FIPP Conference Seoul Korea

Session: Challenges To the Future of Magazine Distribution in the Asia-Pacific region Session chairman: Louis de Bourgoing, COO, Hachette Distribution Services, France Speakers: Yong-Kook Kim, President, International Publications Service (IPS), Korea Masahiro Ohga, President & CEO, Shogakukan Inc, Japan Gordon Lang, Regional Manager, Deutsche Post Global Mail, Singapore FIPP Conference Seoul Korea

Hachette Distribution Services (HDS) FIPP Conference Seoul Korea BRANCH OF LAGARDERE GROUP 2001 KEY FIGURES: Sales: 4.3 billion euros 13,000 p. 30 companies,19 countries: Europe (AMP, SGEL, Naville, Saarbach…), USA-Canada (Curtis, LMPI…), China (Hua Dao), Australia-Singapore (Newslink) 2 BUSINESSES: 50% PRESS DISTRIBUTION the only multinational domestic & international press distribution group 50% MEDIA PRODUCT RETAILING in travel retail: Relay in stations and 80 airports in high street: Virgin Megastore in continental Europe A PRESS SPECIALIST: 66% OF ITS TURNOVER

Asia Pacific Magazine Market FIPP Conference Seoul Korea HDS estimates Domestic Magazine market + Import market missing market figures: NZ, Indonesia, Vietnam, South Af, Canada, South-Central America, Middle East…

FIPP Conference Seoul Korea HDS estimates Domestic Magazine market + Import market

FIPP Conference Seoul Korea The Chinese model Publishers (1,000) Post officeNational Distributors (national and regional offices + field force) SubscriptionLocal post Independant wholesalers (500/1,000) Independant steet news-stands: 10/20,000 Post office news-stands: 5/10,000 Kiosks chains:4/5,000 Convenience stores and others: 2/4,000

FIPP Conference Seoul Korea The Korean model Magazine Publishers (a few hundreds) Bookstores (mainly smal independents) 4,000 CVs 1,500-2,000 travel retail stores (Seoul subway 130) kiosks (street) * 1,000-1,500 * Associated with bus-stops: only dailies and a few weeklies local wholesalers = 5-6 wholesalers/ku (county)

FIPP Conference Seoul Korea The Japanese model 3,000 Magazine Publishers TOHAN*NIPPAN* Keitokusha, Takiyama,… JR unions/subsidiaries 10,000 20,000 10,000 14,000 travel retail stores 5,000 * Publishers owned Magazines & books distributors 5 main others 7,500 4,500 bookstores CVs 8,500 own regional wholesale Magazines & dailies distributors

Challenges to the future of Magazine Distribution in the Asia-Pacific region FIPP Conference Seoul Korea  Asian financial crisis: slower or negative growth (except China), less big sellers, more specialized titles, more returns:  increasing cost of distribution, need for productivity gains  less shelf space, reluctance of retailers to take titles  Recent downturn in advertising market:  copy sales larger source of income  more competitive environment  need of better/more aggressive distribution  Need of lower costs/productivity gains/concentration of wholesalers  Market shift from independents towards chains and travel points: need for new innovative marketing approach – more investments in tools and people  Development of subscription: positive trend but high risk of delivery cost increase  China, South-Korea, Taiwan …: how to manage and structure hundreds of independent wholesalers and retailers ?  Growth potential in export/import of Asian titles  Pay on scan: opportunity/risk in Asia/Pacific ?