Wednesday, October 22, 2008

British magazine distribution could do with some competition, report says

British magazine publishers and retailers may soon see greater competition in distribution of titles, after a ruling by the Office of Fair Trading (OTF). According to a story in the Guardian, it means that

Newspaper distribution will continue to be protected by an opt-out from competition law under guidance handed down today by the Office of Fair Trading.

However, the regulator said magazine distribution could work better if there were greater competition among wholesalers.

UK wholesalers now enjoy "absolute territorial protection" - ATP - giving them exclusive access to specific areas of the country, and retailers stocking newspapers and magazines cannot choose between different wholesalers. This has been justified because of the time pressures on daily newspapers and the same system has applied to magazines. (Compare this with Canada where magazine retailers have a choice -- albeit a limited one -- of distributors and wholesalers. Territorial exclusivity was essentially done away with several years ago.)

The OTF said in a report that magazine sales were not subject to this same pressure as newspapers and that there was "greater scope" for competition between wholesalers.It is now leaving it to publishers, distributors and wholesalers to decide whether the current regime is compliant with competition law. Spokemen for the magazine industry said that many weekly magazines are under the same time pressure as newspapers and should retain similar protection.

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