Bad timing -- Demian and Aaron are both on vacation for the next two weeks, so we're a bit shorthanded at the moment. We're still working hard to promote the best community stories to the front page (and yes, our contest is still going on). But to help make up for the lower output from the staff side, we're going to rerun a few still-relevant articles from my old Sore Thumbs Blog, with updates where needed.

We know some of you have read these posts before, but since Bitmob has many more readers than Sore Thumbs ever did, this is probably still worth doing...especially because this is the easiest work we'll ever get to do -- this stuff writes itself! Because it's already written.

Up first: A behind-the-scenes look at the magazine business and why we had to say goodbye to a pub like EGM despite its popularity.

EGM closed up shop because Ziff Davis Media was too busy babysitting a massive debt to manage its magazines properly. As far as I can tell, that’s why other magazines can still survive in this economy but EGM couldn’t. But really, ZDM didn’t get any help whatsoever from the nature of the magazine business itself. Here are the other major contributors to EGM’s death....

Distribution

The magazine business is a horribly inefficient one. We’d have to overprint every issue by hundreds of thousands of copies in order to make a certain amount of sales at newsstands, because so many of them get lost in the distribution process.

A 40% sell-through may sound horribly wasteful to you (it is), but that’s considered a sales success to a publisher. 50%? Holy crap! Now...think of what our books looked like when 60%+ of the copies we paid to have printed (roughly 75 cents to $1 per issue) never get sold.

The printer prints the magazines, then they go to a variety of distributors, shippers, and wholesalers to get moved all around the country. I won’t get into details of this process, but let’s just say we might as well have used the Pony Express with crippled horses and no riders.

A lot of copies never make it to the stores -- they literally stay on the trucks somewhere because the entire distribution system is archaic. Every person you’ll ever talk to who deals with the circulation business will tell you how much they hate this setup, yet no one can do anything about it because it’s an established network that really has no reason to change (there’s no money in fixing it).

With the copies that do make it to the stores, some of them never make it to the actual shelves, because very few retailers care enough about magazines to stock them properly (they’re not high-income items). And if they are lucky enough to make it out of the back store room, there’s no consistent system to how they’re displayed on newsstands. That hot copy of EGM’s Street Fighter IV world-exclusive could be hidden behind Hot Women on Hot Rods Magazine or the latest Crazy-Ass Crosswords!...and no one would ever know.

How many times have you walked into a store and couldn’t find the newest issue of your favorite magazine, but a three-month-old copy is still sitting on the shelf? Again, it’s because no one cares about magazines. A lazy sales clerk may see “EGM” there and not know that particular issue’s expired and is supposed to be replaced. So then that outdated issue doesn’t sell, our newer issues don’t get a chance to sell, and we lose circulation and revenue.

Actually, some sales clerks do care about magazines...enough to keep them for themselves. I used to work at EB Games, so I know how this works. A new shipment of magazines would come in, and we’d rip them open to read for ourselves or to take home…before a customer can even see them.

Periodicals weren’t in the system as real inventory, so no one would ever know if they ever got sold or not. So for the employees there, magazine shipments were an all-you-can-take free buffet. Why not take a few?

So now here’s Ziff Davis Media...paid for 10 issues to be printed and shipped to my particular EB Game store, and maybe five of them will actually make it to the shelf after the employees raided the box. If three of them get bought, that’s 30% efficiency right there.

Advertising

Of course, a lot of advertising dollars are moving away from print and to the Internet -- that’s a pretty obvious way EGM got hit hard (you’ve seen how thin the issues have gotten over the past few years).

Magazine ads deliver vague, immeasurable impressions that no longer impress advertisers. Yes, you can offer circulation numbers, and third-party services study how many eyeballs hit each issue, but they’re not the same as a banner advertisement, where you can literally count every single impression accurately.

Traditional magazine ads just aren’t important these days when advertisers can grab your clicks with big-boobied chicks selling online games or weird, misleading clothing shops.

The Internet

And you also know how the Internet as a content source is making it difficult for magazines to thrive. We’ve heard it a billion times from our readers: Why pay for an issue or a subscription when the web has so much more stuff to read/watch/listen to...for free? That hurt EGM as well, despite our best efforts to evolve and stay relevant and different in this new information age.

By the way, all the websites that scanned EGM? That really hurt, bad. EGM depended on single-copy sales for a lot of its revenue. We'd always see a bump whenever we had a big exclusive on the cover, but then those bumps would become smaller and smaller over time because more and more people realized they could find scans online for free somewhere instead of paying $5-6 for an issue.

With the viral nature of the Internet, there was very little we could do about the distribution of those free scans, so all these little fan sites and forums really screwed EGM in the end.

Ourselves

ZDM’s own editorial policies didn’t help the bottom line. Editorial coverage wasn’t for sale. Covers weren’t for sale. Scores weren’t for sale. And if the editors somehow pissed off an advertiser, screw it...let them stay pissed.

Don’t read into that the wrong way: We enjoyed working in the environment that ZDM and my old bosses set up, happy that corporate usually had our backs and kept church mostly separate from state. Those policies served us well, and we’ll continue to abide by them here at Bitmob. Ultimately, however, that didn’t translate into extra profits for EGM.

But we wouldn’t have had it any other way.

Continued in Part 2.