1. 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 2002 - Seoul Korea

2. 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 2002 - Seoul Korea

3. 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 2002 - Seoul Korea

4. Hachette Distribution Services (HDS) FIPP Conference 2002 - 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

5. Asia Pacific Magazine Market FIPP Conference 2002 - Seoul Korea HDS estimates Domestic Magazine market + Import market missing market figures: NZ, Indonesia, Vietnam, South Af, Canada, South-Central America, Middle East…

6. FIPP Conference 2002 - Seoul Korea HDS estimates Domestic Magazine market + Import market

7. FIPP Conference 2002 - 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

8. FIPP Conference 2002 - Seoul Korea The Korean model Magazine Publishers (a few hundreds) Bookstores (mainly smal independents) 4,000 CVs 1,500-2,000 travel retail stores 150-200 (Seoul subway 130) kiosks (street) * 1,000-1,500 * Associated with bus-stops: only dailies and a few weeklies 4-500 local wholesalers = 5-6 wholesalers/ku (county)

9. FIPP Conference 2002 - 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

10. Challenges to the future of Magazine Distribution in the Asia-Pacific region FIPP Conference 2002 - Seoul Korea  97-98 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 ?