How the Harper Government & Motorcycle Industry are Crushing Online Publishers

on


I finally believe the press that the Canadian Motorcycle Industry is swirling down the drain of an economic downturn. The symptoms of an ailing industry have increasingly affected Canadian online media as motorcycle companies close regional offices, as press fleets dwindle and as tension over perceived damage to test bikes increases. For those of us publishing on the web exclusively, the situation has worsened, as Rob Harris of CMGOnline.com, points out in his editorial CMG Call to Arms, which reveals the massive cash injection of Canadian print publications are receiving from the Harper Government to assist their move from print to the web.

The $70M 2010/11 Aid to Publishers fund is available from the Federal Government exclusively to print publications, and allows those receiving this tax-payer treasure trove to apply the money to a number of eligible activities, most notably, “Web site development and enhancement”.

To quote Harris’ piece, “Canadian motorcycle magazines got a substantial chunk of cash this year; Canadian Biker: $58,894, Cycle Canada: $111,741, Inside Motorcycles: $51,365, Moto Journal: $63,548, Motorcycle Mojo: $19,835. There was a total of $305,383 being handed out to my print-only competition and any or all of it now eligible to be used to develop their web presence.”

Now, you would expect a Conservative government that is big on small business, would step up and keep the capitalist playing field level, but there truly is no equivalent grants or funding for online only publications.

So now magazines that were content to rest on their laurels rather than innovate themselves into the next generation of publishing are reaping vast rewards for their laziness and unwillingness to compete with online media. Those rewards are not simply monetary.

Over the 15-year run of CMGOnline.com and the 9-year run of OneWheelDrive.Net our respective teams have been forced to repeatedly attempt to educate the Canadian Motorcycle Industry of the pros and cons of Internet versus Print advertising. And, trust me the repeated compare and contrast would be a truly exhausting battle if it didn’t feature such sadly humorous gems as,
“We’re trying to reach a younger more urban audience.”
“So you’re going to advertise on the web and create a social media initiative?”
“No, we’ll stick with print advertising.”

While it’s more mature and robust sibling, the auto industry, has moved on to embrace the cost effective nature of social media and web advertising the motorcycle industry has stayed put in the print realm nearly refusing to adapt. Not even the argument of economics has motivated the embrace of the new media when it’s pointed out that the cost of an online ad for a 6 month run is less than a full page run for a month in any major publication. Leave alone that online advertisements are truly audit-able, unlike print’s questionable estimates and assumptions of secondary readers.

There are of course notable exceptions to these statements. I’d like to thank Ducati and Honda for seeing value in our online efforts, and providing support beyond the supply of test product, where so many others fail to.

That is the crux of the issue, is that the Harper Government’s assault on internet publishers could be survived, if the motorcycle industry saw value in the reach online media outlets offer.

Most manufacturers greedily take advantage of the “free” coverage online media provide to their products be it in tests or advertisements masquerading as press releases. This is done without acknowledging the uncomfortable truism of print or online publishing; editorial coverage does not exist without advertising support. At least, that would be the case in a free-market economy where the government doesn’t stamp on the throat of one media to favour another.

Advertising, for better or worse, indicates the value placed on coverage by the manufacturer, regardless of the actual effectiveness of the advertisements. Face it, no one ever bought a bike because they saw a shiny ad glittering with marketing claims. In the end without that advertiser support, media exposure, which is an integral part of reaching consumers disappears – along with the sales that coverage generates.

This is where the motorcycle industry does itself a disservice, because most manufacturers have missed the chance to groom motorcycle media. A pro-active approach would see manufacturers actively working with media outlets that are sympathetic to their product, niche or simply motorcycling as a whole. The overall impression most online journalist have in Canada is that manufacturers regard them as an irritant and barely necessary evil.

Part of this attitude comes from our’s being an enthusiast industry. The manufacturers trust that their media are motorcycle enthusiast, and if a few test products are thrown our way, we’ll be excited and write about them. It is a good, safe, and abusive bet. One that sees the industry use up its media advocates and supporters.

The really sad part of this equation is that the innovation, which has consistently been the hallmark of online media, will disappear also. Web video will strive for corporate mediocrity, iPhone Apps won’t be published until the market is utterly proven and safe, Kindle will be ignored for similar reasons, the government supported print-dinosaurs will lumber on thinking a forum is the peak of social media, and motorcycling will not reach its full online potential. Until a new wave of naive onlines try to make a go of it only to be used up and spat out.

The overall result though is a perfect storm. Small web publishers with limited support are facing large magazines who are now flush enough to buy up first run freelance articles, hire up staff “groomed” by online magazines and can stamp their feet enough that onlines aren’t invited to critical (or any) press launches, all of which is happening in conjunction with a hard economy for online publishers.

Filed in the category of “Thank You for Small Favours”, at least this unfair sluicing of tax dollars into the print media pig-trough will lend some validity to the web in the eyes of a groaningly slow to adapt Motorcycle industry. The question is, will any of the innovators survive that long, or will the Motorcycle Industry and Harper Government continue to support mediocrity rather than risk the brave new world of the internet. The sad thing about that last thought; it was as valid in 2001 as it is a decade later.

Advertisements

12 Comments Add yours

  1. es says:

    No amount of subsidies can get readers (eg me) to buy magazines they don’t want to read. Conventional print magazines are going the way of the dodo. Check the corner stores, where have all the magazines gone?. Why spend 6 bux to get old news, generic road tests of bikes I don’t want to have, and product reviews of stuff I will never buy? Hang in there web publishers, pretty soon you will own it all.

    Like

  2. Steve G. says:

    I hear and understand your frustration. Your anger should not be directed at just the Harper government, but in equal amounts at the former Liberal government which initiated and entrenched this “pig trough” many years ago, with financial subsidies to most all Canadian print media. It was because of this that many years ago I stopped my long time subscriptions to Cycle Canada, and Canadian Biker.
    I for one disagree with ALL government subsidies to private concerns. If a company cannot ‘hack it’ in the real world, then let it die! Your article here simply points out to me the sad view that Canadian society as a whole now has a hand out for government help for anything, the true nanny state is fully entrenched, it’s sickening!

    Like

    1. Steve,
      We’re not asking for a had out, we are asking for a level playing field. Government subsidies do have their place in incubating economic growth for the betterment of the country as a whole, scientific research would be a prime example, but in this case the “Harper Government” has perpetuated a preexisting situation that is crushing small businesses. Remember, while our case pertains to the motorcycle industry, it really is applicable across all small onlines. This subsidy should not exist, to encourage the evolution and growth of media.
      I was very careful in my choosing to call this a “Harper Government” issue, as they have decided to rebrand the Government of Canada with their own label. That means that this minority government by their own design has to take credit for the decisions that have hurt as well as helped Canada, and the policies they perpetuated.

      Like

  3. Rob Harris says:

    I’d like to add that it was the Harper Government that changed the subsidy rules to allow print magazines to use that money to develop their online presence. Before that it was for printing, mailing and some editorial costs.

    Still not fair as it had an editorial component that online media had too, but at least it left online with one hand free with which to fight.

    Good piece Neil, and thanks for helping get the word out.

    Rob Harris, CMG Online

    Like

  4. RR says:

    I see your point about how print media is getting more help than online media. From a purely economic perspective, print media requires more resources (read more jobs rely on print media) therefore a dollar spent on print media will have a bigger impact due to the multiplier effect. Promoting print media also benefits the lumber industry therefore I think it is a good idea to allocate tax dollars to promote these industries as there is more benefit accruing to the country as a whole. Online media has lower operating costs and creates fewer jobs so I don’t think that tax dollars should be allocated there.

    Don’t get me wrong, I am an avid fan of one wheel drive and CMG and I think the quality of the articles are better than in a magazine. Have you thought of a subscription type business model similar to hell for leather?

    Like

    1. RR,
      Sound logic, but we’re not talking about print media being print media. The grants are for the development of their web sites, so unless the print magazines are being disingenuous and simply putting the funding they receive into general revenue, they aren’t actually promoting the existing print industry.
      We are considering a pay structure, though not as widespread as HFL. It would primarily be micro-payments for the feature articles. I hate the thought of putting our work behind a pay wall, it runs counter the “free” nature of information on the web, but an ad free OneWheelDrive.Net may be worth it.
      Neil

      Like

  5. doug says:

    Hiya Neil

    I don’t know if my response counts for much because I am over here in the U.S. I am a die hard print magazine fan(there is nothing like sitting back in an easy chair with a magazine), but over the years most of the U.S. motorcycle magazines have turned to junk. The problem with magazines today as I see it is that they push to much towards smaller attention spans with articles that are general outlines rather than a full fledge story.They lack the enjoyment and comraderie that used to be the mark of a good magazine. Specifications and statisics and adds seem to fill all the pages. Some online magazines such as One Wheel Drive write much better storys without forgetting to have fun even while working hard with little return. Unfortunately I really don’t like reading magazines on the computer. I think along with the rise in online magazines we could use something better in the portable reader market. The Ipad is probably a good start but something with a full page 8 1/2 X 11 inches would be nice with a no glare matte colour screen.
    I think the Canadian Government would be smart to remember folks such as One wheel Drive and other Online motorcycle magazine pioneers when handing out the cash unless they want to be stuck with the same old boring Motorcycle mags. That probably would apply to a lot of other magazines too.
    Thanks for the great magazine, Neil. I would love to see it in print, but alas, That would ruin it.

    Like

  6. madjak30 says:

    I know you don’t want to have a “pay wall” to access the stories/adventures, but what about a subscription to access being able to comment on the stories…it may have a bit of an effect on the participation and forum quality of the comments, but if it was $10-$15 per year…it would be more helpful to you, getting the donation directly, than waiting for the government to “clue in”…I like having the Canadian perspective on the stories…and One Wheel Drive is the only Western Canadian magazine I know of, so I would definatly support your magazine…I have to get my PayPal account set up, since I made a similar statement to Rob on his story…

    All talk, no action… ;-|

    Later.

    Like

  7. dave says:

    I read most of the motorcycle stuff online now. Reviews of product , I ll look online. I read mags but cheap butt person I am don’t buy them. Most of my chooses are from websites and not some paper mag. there isn’t even a scooter mag that covers anything but vespas. Paper mags think 10 grand for a bike is cheap and that was the headline out of one of them 10 cheap bikes under 10 grand.

    Like

  8. mxs says:

    There should be zero subsidies on something like print publications, regardless of their flavor. You cannot make the business model work, well I guess the market cannot bare its existence.

    I find it hilarious and sad that the government would be handing incentives out to companies to switch from print to web (digital, whatever …). Why??? You don’t see where the market is going you don’t deserve any money, forget tax payers money ….

    This Harper government is something else, and I thought Liberals were bad ….. I guess they are all guilty as charged.

    Like

  9. David says:

    A quick note for those who feel government subsidies to Canadian publications (or websites) should stop:

    Would you like a landscape devoid of Canadian media? Where all of our information comes from south of the border? That is exactly what you are asking for. It has nothing to do with “business models” or being “unable to compete.” It has to do with the overwhelming deluge of US publications that would drown their Canadian counterparts overnight if it weren’t for Government funding. Niche publications like Canadian Biker, Cycle Canada and Motorcycle Mojo are LUCKY to get 30,000 circulation, whereas Cycle World has more than 300,000 subscribers. Canadian niche publications beg US manufacturers to buy $3,000 (or less) full-page ads, where US publications get $30,000, $50,000 or more for the same piece of paper – and the same ad!

    Further – US publishers bully newsstand distributors into carrying their titles by “bundling” their magazines… that is, if a newsstand wants People Magazine, it also has to carry the rest of Time Warner’s magazines, whether they sell or not… leaving little, if any, room for a Canadian publisher to sell his book.

    Virtually every industry in Canada receives either tax breaks or funding from the government of some kind – provided they keep their business IN Canada. If Canadian mags stopped getting funding, they would all move their printing to China and have no incentive to hire Canadian writers and photographers. No one, I’m sure, wants that. Remember – tax money is OUR money.

    As far as funding for websites goes – this is an interesting debate and one that will evolve over time I’m sure. Questions to be asked include: how many visitors per month must a site have before it can be considered legitimate? What is this funding to be used for… for example, in the print industry, it covers printing, mailing and distribution. In the digital world, it would presumably go into publishers’/contributors’ pockets, as the “hard costs” of running a website each year are a pittance compared to the hard costs of printing and mailing a magazine.

    Good article. Good debate.

    Like

  10. David Andrews says:

    Neil, you’re hitting the bullseye. The good idea/intentioned ferries that flit about in Ottawa are blissfully unaware of what effect their good deeds do, typical. What is intolerable is that these well paid well educated people refuse to listen and refuse to address the short falls of their programs. in essence they are in capable of learning from their mistakes or choose to remain ignorant of this as it would be embarrassing. It’s one thing to do good things but you have to do them well and that means being aware. I used to work for ACOA (Atlantic Canada Opportunities Agency) in another life and I recall that there was a process of vetting applicants that included a competitive impact analysis. The thought process being that there is no net economic benefit to put one business in while taking another out. What happen to this process or did they (the gooberment) just google research without going to the actual player (aka you)?

    Perhaps you can get a reciprocal grant to publish your guide..?

    All the same I remain a fan of OWD.net

    Just bought a GSA and am currently riding it back from Calgary to NS. This April weather is brutal and I’m in the middle of my own X Canada adventure, which is all well and good when I am sitting in a warm hotel typing notes while I wait for the weather to improve or at least warm up a bit.

    Cheers,
    David
    CanadianX on AdvRider

    Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s