Reed Elsevier, the world's largest publisher with over $9 billion in annual revenue is in the process of cutting its exposure to the print and advertising segments of the market and intends to concentrate on higher growth online and subscription activities.
The company recently sold Harcourt Education for approximately $4.9 and has put Reed Business Information division for sale. RBI's magazines range from Variety in the U.S. to Farmers Weekly in the UK. Its magazine portfolio makes up 30% of its online and 56% of ad revenues and could raise over $2 billion according to investment analysts. The company also cautioned that due to the difficult credit markets a de-merger or break-up of the magazine portfolio is a possibility.
Reed Elsevier had a 6% revenue growth in 2007, but these moves are another indication that major industry players do not see future growth potential for printed products. Image producers should recognize that even if the printed products are replaced with an equal number of digital ones, the fees paid for digital image uses are likely to remain substantially lower than those paid for print uses.