My first thought, once I’d accepted the invitation, was to ask myself: how can I make a useful and worthy contribution to the discussion about the future of the magazine? Unlike most of you here, I am not a writer, an editor or a publisher. But I will bring a different perspective as my positioning combines both personal and professional ingredients.

First of all, on a personal note, I’ve been an avid magazine reader since I was a kid and I belong to a strategic audience for the future — the 25-to-45 age group. We’re part of the pre-Internet world of culture and information, but we’re very comfortable in this new world. Even so, I’m in a very good position to see the differences between my generation and the next, since my daughter, Jeanne, will be 10 years old in a month. And she’s in a completely different world as far as consuming information is concerned.

On the professional front, over the past 10 years, I’ve been involved in Transcontinental’s merger and acquisition activities. We’ve made a total of 75 acquisitions in our different areas of activity: printing, direct marketing, newspaper and magazine publishing and, more recently, digital technology.

In terms of magazine publishing, I participated in the Telemedia acquisition and led the Avid Media acquisition, among others. To direct an acquisition process, you have to know the industry in order to answer the following question: is this the best way to use our shareholders’ money? So, it was through this capacity that I first came to learn about the magazine industry.

Our partnership strategy also put me into direct contact with major international publishers. These include Meredith Corporation, the U.S. company that has specialized in consumer magazines for over a century and from whom we recently obtained a license to launch More magazine; Bayard Press, with whom we publish the magazines Good Times and Le Bel Âge; and Hachette Filipacchi. I find it very interesting to be on the board of directors of the Transcontinental-Hachette co-publishing venture, which is putting out titles such as Elle Canada and Elle Québec.

The third element that colours my viewpoint is that Transcontinental is both a magazine publisher and a magazine printer (just as we are with newspapers). A quarter of our magazine printing sales come from the United States, where we specialize in short-run printing. We have about forty clients including Time Warner, for whom we have been printing Time Canada for the last seven years. Because we print magazines, we have even greater familiarity with the specific situation of the North American magazine industry, and the challenges facing it. Indeed, the future of the magazine is a doubly important issue for Transcontinental, since magazine printing and publishing combined brings in annual revenues of about 400 million dollars.

Finally, I’ve been responsible for Transcontinental’s strategic planning process for the past three years now, which puts me right into the heart of my topic, since the purpose of strategic planning is to decide how we want to grow as a company in the long term. I have also learned a lot from the managers who head up our various divisions. On the magazine side, I’d like to mention Natalie Larivière, president of the Media sector, Francine Tremblay, senior vice president of the Magazine Group, and Jacqueline Howe, who is responsible for our titles in Toronto.

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To structure my presentation, I decided to proceed through a series of statements that will gradually outline my position on the future of the magazine industry.

Speaking of statements, let me start by saying that I disagree with those who say the magazine in its printed form is heading for extinction. Like any other consumer product, the magazine must continually adjust to the market—to the people reading the magazine. It’s all about evolution.

FIRST POINT: The magazine industry is not in danger.

It’s a myth that it is. In fact, our industry is in a period of rapid and profound change stemming from the combined pressure of two forces that are affecting most other industries as well.

First, we are seeing the emergence of new consumer behaviours. I’m thinking of the penetration of the Internet and digital technology in general in daily life, particularly for young people. But new technology doesn’t make what came before disappear altogether: radio didn’t eliminate newspapers, television didn’t eliminate radio and the Internet won’t eliminate all the rest. But it is forcing us to adjust and redefine ourselves. It’s evolution, not extinction.

Consider that newspapers have moved from afternoon to morning editions and are starting to look more and more like magazines, with colour pages, special editions, glossy paper, etc. Also consider that radio and television are now specializing to serve defined special interests: sports, business, cooking, and so forth.

It seems that one medium complements another. At Transcontinental, the company-wide shift to digital technology is operating within this complementary framework. Paper must necessarily be coupled with the Web.

We are also seeing the rise of new values, such as increased concern for the environment. It is difficult to measure its precise impact, but it is a major and irreversible trend. Will it lead to the end of printed material? To a paperless society? I don’t think it will and you probably feel the same way.

However, things are changing. This is why we joined forces with Cascades to offer an environmental paper to our book publishing customers. This trend will also have an impact on magazines. This past April our Coup de pouce and Canadian Living magazines invited their readers to take the Green Challenge. That issue of Canadian Living was also printed on recycled paper and now, when Coup de pouce does product reviews, it places a green logo on any consumer product considered environmentally friendly. Many magazines represented here today have launched similar initiatives in recent months. We will come out of this stronger than ever. It’s part of our evolution.

We also see the “greening” of our industry as opening up new business opportunities. We recently launched, with considerable success, a new French-language magazine on sustainable development, called Vision durable, or “Sustainable Vision.” What is interesting is the great response we had from environmental groups who understand how their cause benefits from the prestige of a print magazine. Obviously, the magazine is printed on 100% recycled paper and is accompanied by a very lively and interactive Website.

In short, the magazine industry is evolving and we have to adapt to new realities, which positions us well for success now, and in the future.

SECOND POINT: I firmly believe in the future of the print magazine.

Every day, all over the world, magazines are born and magazines die. Every year, there are many new titles out there, both from major publishers and small independent operations. In the first quarter of this year, 105 magazine launches were announced in North America alone. And I can state with confidence that Transcontinental will continue introducing new titles in niches with high growth potential.

Launching a new magazine is an act of faith, or perhaps more precisely, an act of “deep pockets” because it usually takes about five years before it becomes profitable.

As has always been the case, some will do well from day one and others never will. The Canadian version of More magazine, for instance, which we launched in March, has been as big a success as Meredith Corporation’s U.S. version. We figured we’d get about 40,000 subscribers for the first issue. Instead, we doubled that number. More is aimed at women in their forties, an underserved niche in the Canadian market.

Also, in partnership with Yellow Pages Group, we have launched an innovative series of niche-specific guides that leverage the power of attraction and credibility of our existing brands, such as Canadian Living, Bel Âge, Home Improvement, Décormag and Style at Home, along with YPG’s expertise in selling local classified ads.

Other publishers have also been innovative in the magazines they’ve launched. I’m thinking, for instance, of Reader’s Digest’s introduction of the magazine Oh Canada, the content of which is generated by its users.

Why do I believe in the future of the print magazine?

On a personal level — and I’m surely not alone in this — I think of the unique experience of holding a magazine in my hands, touching it, flipping through it from beginning to end and admiring the play of colours and graphic design, then returning to certain pages to read articles in depth. I can do that wherever I am: on the beach, in my living room, in my garden, the office, in bed or on a plane…no Internet connection required! Magazines are the original portable entertainment device.

On a more general level, I see the magazine as providing a unique aesthetic context for the editorial and advertising content. This is particularly true for lifestyle-type magazines. The readers of such magazines definitely take in the ads. I can’t tell you how many times I’ve heard people say “Wow, the ads are great!” The only time I hear that for television is when the Super Bowl is on!

In addition, the Web doesn’t allow for Calvin Klein scent strips!

Historically, magazines were the first print publications to become national and international products. Newspapers were originally local products. In this period of profound change in the media industry in general, the magazine occupies a special niche. Its aesthetic qualities and specialized content make it very different from the daily information conveyed by newspapers and conventional radio and TV.

Furthermore, the fragmentation of markets provides opportunities for targeted print content. Two pressures are at play here. First, the so-called generation “Y” is much more independent and autonomous than previous ones. These young people are more focused on their own needs and make their choices accordingly. Second, new technologies make it possible to respond to these needs and trends very efficiently. Websites, for instance, can be developed around highly specific content.

In the world of print media, it is the magazine that is best able to meet this trend. Unlike mass dailies, for instance, the magazine serves communities of interest. That being said, to meet these needs, we have to know our readers much better than we do now.

That’s why we believe that the magazine in its paper format will continue to be a unique medium by adapting to new realities.

That’s also what readers and advertisers believe.

The statistics about declining circulations for dailies and magazines are misleading. For instance, if you combine the readership for paid dailies and free dailies in markets where both are present, readership actually increases. For magazines, when you combine the total print and Internet audience, the number of readers interested in this content also increases.

In terms of advertisers, results recently issued in the United States by TNS Media Intelligence and the Publishers Information Bureau show that advertising revenue for consumer magazines grew in 2006 compared to 2005, though at a slower pace than the previous year. For the first three months of 2007, advertising revenue for U.S. magazines rose by almost 7% over the first quarter of 2006, which is almost the same rate as two years ago.

Furthermore, a study by Price Waterhouse concluded that for the period from 2005 to 2010, the magazine share of the advertising pie in North America will remain stable at 10%. So there’s no danger to the industry here either. It’s interesting to note that this same study also says that the advertising pie will increase during that period.

And that brings us to the heart of the matter for our industry in the coming years.

In a period where advertising is becoming more and more targeted, being a niche player imparts an enormous advantage. Advertisers want to better target their consumers so they get a better return on their advertising dollar. This is an irreversible trend.

So advertising space is now purchased based on targeted audiences instead of total number of listeners or readers. This trend is very clear in TV and radio, where specialty channels and stations are giving general networks a hard time. But in the magazine world, that’s exactly where we’ve built our business: around communities of interest.

At Transcontinental, for example, most of our titles are specialized: we publish magazines aimed specifically at women or men, in the areas of fashion and beauty, home and garden, sports and recreation, and financial and business information, as well as trade publications. Every month, more than 11 million readers in Canada are interested in one or more of these niches. For them, our publications are credible and familiar points of reference in a market where the offering is fragmented.

But it is not enough in today’s world to be specialized, which takes me to my third point.

THIRD POINT: We must now offer multiple platforms to readers and advertisers, and as magazine publishers, we’re in a good position to do so.

Transcontinental’s strategy has been clear from the start: offer our readers and advertisers multiple platforms in order to attract and retain everyone interested in that niche. The prestige and credibility of our brands, built up over the years, is a powerful tool which we can leverage in other mediums.

We decided, first, to intensify the development of various digital platforms around the special interest groups that we serve. Here I’m thinking of cyberbranding, or the extension of brands to Websites, portals and Webcasting. This means changing how we think and how we define ourselves. We are no longer a simple publisher, but more and more a media company that produces content that will be deployed via multiple channels.

For example, we launched the Canadian version of the world’s top male lifestyle site, AskMen.com, which we co-publish. It’s a natural complement to our other men’s magazine titles, such as The Hockey News and Outdoor Canada, and already attracts more than 800,000 unique visitors a month.

Business and financial information is also one of our niches, with magazines like Commerce, PME and Affaires Plus, as well as our highly regarded weekly publication, Les Affaires. We have become a Canadian leader in Webcasting, a new media platform. In fact, Les Affaires is Canada’s first print publication to bypass the television and cable platforms and go directly to incorporating video Webcasting into its online version: we’re now doing daily newscasts on the LesAffaires.com site from our Webcasting studio.

In some cases it even makes more sense to turn a publication into an online version only, as we did last November with TV Guide. Other publishers have done the same, usually with titles for a young audience, such as Child Magazine by Meredith, Teen People by Life, and Premiere and Elle Girl by Hachette Filipacchi. There’s no need for me to point out that in another ten years this young generation will be in the 25-to-35 age group.

TO CONCLUDE

To wrap up, I’d say that too often the difficulties in our industry have been blamed on the Internet. Rather, I see the Web as a complement to print products. The Internet is the world of the instantaneous, of the blog and of interactivity, while print is more suited to in-depth analyses. The two will continue to co-exist.

For example, last year we acquired the cooking site Recettes.qc.ca and Trucsmaison.com, a site with great household tips. Both are natural complements to our women’s magazines, not a threat.

Magazines will remain a priority area of growth at Transcontinental going forward. We will continue our market consolidation strategy, which means that we’ll strengthen our niche markets through acquisition, while we continue to launch new products and services, and deploy our content on multiple channels. These initiatives will be supported through our program of special strategic investments in the digital area.

Again, it’s all about evolution.

I hope I’ve added something useful to the discussion about the future of our industry.

Thank you for your attention.