Mag Wholesaler Denies it Will Exit Business

Media Week has released an interesting follow up article to the story I posted earlier about issues in the magazine wholesaler business.

Source Interlink Cos. denied a news report that it is shutting down its magazine wholesaler business, while firing back at publishers that balked at wholesalers’ demands for higher fees.

Source and Anderson News Co., which handle an estimated 50 percent of the magazine industry’s U.S. single-copy sales, demanded in January that publishers fork over an extra 7 cents per copy to deliver magazines to the nation’s retailers. It’s estimated that the fees would cost the publishing industry more than $150 million annually.

Time Inc. and Bauer Publishing, parent of In Touch and Life & Style, moved to stop delivering product to those wholesalers rather than pay the fee. Comag Marketing Group, which delivers for Hearst Magazines, Condé Nast, Wenner Media and others, said it would keep working with Source and Anderson for now.

Source president Jim Gillis said that publishers that suspended their relationships with his company Anderson would see their newsstand sales suffer while they try to switch to competing wholesalers, presumably The News Group and Hudson News.

Stay tuned!