The European Interactive Publishing Scene

By: Steve Outing

This will be the last of my reports from Zurich and the Interactive Publishing conference, held last week. Let me remind you that Editor & Publisher will be providing "the next best thing to being there" by posting audio files of the conference presentations. Look on the E&P Interactive home page to find the files and links to download the RealAudio player that you'll need.

Interactive Publishing attracted about 200 people this year, and while Europeans of course dominated, I met a number of new media people from Asia and South America as well. As you would expect, a good number of Americans were in attendance and on the speaker list. In fact, in my previous columns, I reported on some of the presentations by U.S. speakers like Esther Dyson and Peter Winter. Let me focus today on what's going on in the European electronic publishing world.

While everyone from Europe that I met in the last few days was enthusiastic about interactive ventures and many are engaged in cutting-edge stuff, the quantity of interactive publishing activity in Europe still lags well behind that of U.S. publishers. (My own figures back that up: There are about 400 newspapers operating on the Web in the U.S., versus around 100 in Europe.)

European online publishing ventures are proliferating, but they are hindered largely by high telecommunications costs. Frans de Bruine, director of information industry and market and language processing for the European Commission (EC), said Europe "lags about 2 years behind the U.S." in development of the interactive industry, and online as a business is underdeveloped in Europe. Internet users throughout Europe typically have to pay local-access charges for phone calls, which adds to the cost of subscribing to an online service and is slowing adoption by the public of online technologies.

The EC is slowly working to remedy this situation by introducing legislation that would help privatize some countries' telecommunications industries and encouraging competition to lower prices. "It's happening," de Bruine said, though perhaps not fast enough to satisfy the interactive publishing industry in Europe. "We don't want this to become a 'Wild West' situation," he said.

Content for online services is quite different from in the U.S. as well. De Bruine pointed out that about 60% of online content in Europe is from government sources and 40% from private industry; the reverse is true in the U.S.

Software development in Europe also lags behind the U.S., several speakers and audience members suggested, and software development costs are high, which is hindering the growth of the software business. However, some excellent products are being produced by Europeans, including a nifty Quark Xpress extension demonstrated at the conference called HexWeb XT by a German software developer. HexWeb seamlessly converts Quark Xpress documents into HTML Web files with a few mouse clicks. (It's available only for the Macintosh platform. For information, send email to info@hexmac.de)

Luc Sala, a publisher in the Netherlands who has tried a number of interactive publishing and CD-ROM ventures and lost money at some of them, sounded a word of warning to publishers who are getting caught up in the hype over interactive publishing. As perhaps the sole contrarian to speak at this conference, Sala emphasized, "The Internet will not become a mass market model for many years to come. ... We're in the deep hype phase right now." It is a great business-to-business marketplace, and where money can be made by publishers is in providing local content that "affects people's lives" and that they will be willing to pay for.

Jan Lamers, managing director of Uitgeversbedrift Tijd N.V. in Belgium, a newspaper publisher, cited the shift from mass market media to the one-to-one marketing made possible on the Internet. Technology and markets are changing -- so quickly that it's nearly impossible for humans to keep pace -- so there is a vital need for management to understand the implications of interactive technology and redefine their businesses. In contrast to Sala's comments, Lamers suggested that all content is driving quickly toward being on the Internet -- or what the Internet is evolving to become. "There will be no other information superhighway" than the Internet, although the Internet of today is only the beginning, Lamers said.

An online services panel at the conference was dominated by America companies, with the exception of Europe Online and AOL Bertelsmann Online, the 2 upstart European online services due to launch in 1996. Moderator Robin Hunt of the Guardian newspaper in London did a fine job of grilling each online service representative about why publishers and other content providers should ally with them as opposed to publishing on their own online.

AOL/Bertelsmann's Jonathan Bulkeley, who is an import from the executive ranks of America Online in the U.S., chided Internet publishers for not making money online -- while AOL has, in buckets. The AOL model has proven itself in the U.S., he said, and the online services model can make money for European content providers as well. AOL's partnership with Bertelsmann, the third largest media company worldwide with annual revenues of $12 billion, will roll out in late 1995 or first quarter 1996 with a European version of AOL. However, Bulkeley emphasized, the intention is not to simply copy the U.S. model but to tailor it to the different nature of the European marketplace. The content partner deal sounded very similar to the U.S. model, however.

Bulkeley flexed some muscle in responding to a question about AOL's operations in the U.S. and how it might compete in Europe. "People who don't work with us (as content providers/partners), we compete with," he said, referring to new ventures such as Digital City on AOL, a localized news service that is going head-to-head with the Washington Post's Digital Ink online service. He noted that AOL does not, nor does it intend to, compete with the New York Times, which has a service on AOL.

Europe Online (not to be confused with America Online; they're separate companies) is taking a Euro-centric approach, said Rui T. Guerra, director for new market development. The service will be launched next month in the U.K. and Germany and other countries next year, providing the first multi-lingual online service. Content for geographic (and language-specific) regions will be aggregated within Europe Online in this model. Content providers (publishers) are viewed very much as partners rather than content providers. (Europe Online has been having trouble with its content partners, however. The German publisher Axel Springer AG recently pulled out of the service. That was preceded by the defection of France's Matra Hachette and a partial bailout by Pearson PLC, a founding partner and owner of The Financial Times.)

Guerra said the company has now opted to publish on the open Web platform using the Netscape browser, but also will continue to work with AT&T Interchange and use the Interchange technology for specialized applications where restricting access is appropriate and where the more advanced technology of Interchange can be put into use. (A publisher might, for example, choose to publish most of its content to be accessible on the Web, but use Interchange technology for premium content that only those with Interchange client software would be able to access.)

Guerra said that the approach to differences between the European and U.S. markets are what make Europe Online different from its competitors. There can be little doubt that European interactive publishing professionals cannot look solely to the U.S. and expect models that work there to succeed in Europe. Europe is a totally different environment that offers many opportunities, but also additional challenges not found on the other side of the Atlantic.

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This column is written by Steve Outing and underwritten by Editor & Publisher magazine. Tips, letters and feedback can be sent to Steve at steve@planetarynews.com