Investment banker reports mild optimism among publishers.

The Jordan, Edmiston Group, "Investment Bankers to the Publishing, Information, Communications and Exhibition Industries," had this to say in its latest Client Briefing newsletter:

"Due to several factors, including the recent spurt of the major stock indexes and a general flattening of the unemployment rate, many economic forecasters and senior executives of large corporations are optimistic about the economic outlook, especially for 2004."

JEGI interviewed a number of publishing executives, and the response of Tom Hogan, president of Information Today Inc., summarized the challenges and thoughts of many of them::

"We are fortunate to still have paid circulation revenue as part of our business model. We are even considering converting one of our controlled circulation magazines to paid, simply because we feel so vulnerable to advertising slumps.

"One thing that concerns us is that some advertisers have cut their print ad budgets in favor of online advertising. That is fine, since we have both media to offer, but the price points that advertisers expect in the online world are considerably lower than for print. This means we have to find more advertising opportunities for the same advertiser in order to keep our revenue base, and we find ourselves running out of meaningful inventory. The migration from print to online is going to be one of the biggest challenges B2B publishers face over the next several years.

"All in all, we are optimistic about revenue improving sometime in mid-2004. It will be a pleasure to focus on revenue opportunities for a change. Cost cutting is not a sustainable business model. It is also not a lot of fun."

Asked what keeps them up at nights, respondents said:

* "What keeps me awake at night is the continued lack of broad economic growth in the B2B environment. We continue to hear economic forecasts of an improving economy, but have seen little postive effect in B2B."

--Cameron Bishop, president and CEO, Ascent Media Inc.

* "Here is what keeps me up at night: long-term top-line growth--there is always pressure to uncover the next big idea. Oh, and one other thing ... lawyers."

--David Lipson, president, MetroCorp.

* "What keeps me awake at night is trying to set strategy for the future while fighting all the fires of today."

--Andrew Weber, chairman & CEO, Farm Journal Media.

M & A activity

JEGI also reported that merger and acquisition deals in the Newsletter Publishing category (one of ten) for January to September, 2003, numbered 10, at a value of $82 million. That represents a 11.9 percent rise from the nine deals for the same period 2002, and a whopping 176.6 percent rise from the previous year's $30 million in value.

The number of Newsletter Publishing deals and their value also compares favorably with most of the other categories, second only to Educational & Professional Publishing's astronomical 579.8 percent rise in value--and way ahead of Business-to-Business Magazine's 91.8 percent rise in value.

Four of the other categories saw big drops in the value of their M & A deals.

JEGI, 150 E. 52nd St., 18th Fl., New York, NY 10022, 212-754-0710, fax [phone], www.jegi.com