Retail News July /August 2014 (news)

4|Retail News|July/August 2014|www.retailnews.ie

News

Irish Publishers Charged Fee for Airport Listing IRISH publishers have described as is unaffordable. “outrageous” a plan to charge them “We are a small independent £500 [€630] per title, per annum, to publisher and don’t get involved in the stock magazines in WH Smith airport politics of magazine publishing,” said stores in Ireland.

Nick Maxwell, who owns Wordwell Retail News has been given access Publishing. “We have three titles: to an email, sent last month, which History Ireland, Archaeology Ireland stated “as and from 21st July 2014 your and Books Ireland. They are looking for title will be delisted - unless [you] come £500 per title. That’s a total of £1500 to an agreement with WHS to get your [€1890] every year. We simply can’t title ranged for your next issue.” afford it.”

According to the letter from WH According to the letter, publishers Smith, “The promotional fee for being cannot distribute to WH Smith listed in the airports is £500, which Stores “unless you have a commercial ensures a listing for a 12-month agreement and obtained an period. This is by ‘authorisation code’ week commencing from WHS, in advance”.

21st July any Maxwell contacted titles that do not Lucid Direct, the UK have a commercial company that supplies agreement with WH Smith’s airport WHS will be delisted planograms but received (sic).” “no offer of agreement”.

The apparently He continued: “We are compulsory effectively delisted. I “promotional fee” have written to them pertains to seven complaining about this.

WH Smith stores Lucid got back with an in Dublin airports offer to meet, but after and one in Shannon. the deadline of July 21, For some Irish and so there is no offer Nick Maxwell, owner, Wordwell publishers, the cost Publishing. on the fee issue. So we

are still delisted.”

Easons originally held the contract for shops at Dublin Airport before WH Smith took over a year ago. However, this is the first time publishers have been charged “promotional fees” for listings. According to Vincent Jennings, CEO of the Convenient Stores and Newsagents Association, the Competition and Consumer Protection Bill, which will pave the way for a grocery watchdog, does not provide for newspaper or magazine distribution.

Jennings said: “Sinn Fein Deputy Peadar Tóibín, at our request, sought to have an amendment to the Competition and Consumer Bill, providing for an extension of products sold within grocery shops, such as electrical materials, potted plants, newspapers, magazines, telephones, etc. It’s a misnomer to suggest a grocery store only stocks grocery products. We got no satisfaction from the Minister, who has limited it only to grocery products.”

Most publishers Retail News spoke to wished to remain anonymous. Some publishers have agreed to pay the fee; others have not. The Competition Authority confirmed they had been notified about the letter, but declined to comment.

Retail News|July/August 2014|www.retailnews.ie|5

News

Magazines Ireland described the issue as “an ominous and unwarranted development” and have written to WH Smith and to Lucid Direct to express their concerns. Magazines Ireland has described it as an “anti-competitive development” and notes that “while individual publishers may feel pressurised to pay these fees, they do so under protest”.

“Irish publishers are concerned that retailers might wish to make these fees standard in the Irish magazine industry,” noted a Magazines Ireland spokesperson. “This would be seriously damaging to the profitability of Irish magazines, which are already competing with the might of large-scale British publishing, for which these fees are a small matter.”

“There isn’t a fair or free market if people make determinations based on UK considerations,” said Vincent

Vincent Jennings, CEO of the Convenient Stores and Newsagents Association.

Jennings.

There may also be repercussions for the newspaper industry.

“National Newspapers Ireland (NNI) are disappointed to see this ‘promotional charge’ for Irish magazine publications in WH Smith stores in Irish airports,” an NNI representative told us. “We would be gravely concerned if a similar approach was adopted for NNI members.

We would see this as an infringement on the public’s right to be informed.

Newspapers perform a very important role in society, contributing to media pluralism where different voices can be heard. Limiting the number of publications to those prepared to pay the ‘promotional charge’ will create a barrier for citizens’ access to professional and trusted news content.”

Nick Maxwell added: “There is a cultural impact from this fee. I have written to the new Minister of the Arts, Heritage and Gaeltacht to point that out.”

Vincent Jennings called for a competitive environment for Irish magazines. “If they become weaker and less able to compete with larger publications, then they wither away on the vine.

There are some wellknown and successful Irish publications. There are also niche publications within

those publishers. If they don’t get the oxygen of being put up on the shelf, if they can’t get a free and fair basis, then they will die out.”

Retail News contacted WH Smith, where a spokesperson noted how “as a matter of policy, we are unable to comment on specific commercial arrangements with any particular supplier.”

However, WH Smith noted how they make a limited and fixed margin from magazines, which does not cover the costs of their operation in prime travel sites such as airports, in view of the premium rental charges at these locations: “In order to maintain a wide range of publications for customers in such key locations, we therefore work with our supply partners who provide support towards certain of the promotional and marketing costs.”

The board of Magazines Ireland is concerned that this levy is in breach of certain sections of the Code of Practice for the Press Industry (COPPI) which publishers, wholesalers and retailers have all signed up to through their representative bodies.

The Code was agreed after a lengthy period of consultation across 10 industry associations, including CSNA, RGDATA and NFRN. The Code is designed to prevent restrictive practices; to bring greater consistency to the industry, particularly in relation to the supply chain; and reinforces the highest possible standards of customer service, ensuring that all customers have optimum access to newspapers and magazines.

“Magazines Ireland regards this as an abuse of dominant position in the airport and anticompetitive,” noted a spokesperson. “Additionally, these charges are contrary to Government policy and recently transcribed EU directives calling for increased competition in the sector.”