Publishers and retailers to unite against OFT ruling

By Alyson Fixter

A long-running feud between publishers and retailers could come to
an end thanks to an industry-wide stand against the Office of Fair
Trading’s controversial proposals to open up the distribution network
for magazines and newspapers to greater competition.

The National Federation of Retail Newsagents (NFRN) is said to be in
“extremely sensitive” talks with publishers and wholesalers over the
OFT’s plans to cancel special arrangements that ensure all parts of
Britain get access to a full range of titles.

Industry bodies
such as the Periodical Publishers Association (PPA) have always been
vehmently opposed to the proposals, but in the past the NFRN has
insisted current laws must change because they give newsagents a raw
deal.

But now, following the OFT’s most recent announcement on
the issue, the NFRN has pledged to seek out a crossindustry answer to
the problem, saying the OFT is failing to address “fundamental” flaws in the supply chain.

In
a statement, it said: “While the NFRN is broadly in support of the
OFT’s draft decisions, we have considerable concern over the analytical
and legal arguments put forward by the OFT in support of its
conclusions, as well as the complete absence of any call for legal
undertakings to remedy a range of other faults in the news industry
supply chain.

“Despite having presented the OFT with the most
detailed submission to aid its understanding of the news industry, it
is apparent that the OFT has only been able to act on the very narrow
brief it was originally given, and therefore makes no proposals and
seeks no undertakings to address inefficiencies, restrictive practices
or retailer complaints that the NFRN had pointed out in its submission
of December 2004.”

The OFT would not achieve a solution to the
problem in its current “narrowly focused” review, it added. The PPA
said it welcomed the NFRN’s move, and is due to comment on the OFT
announcement by 17 July.

An industry-wide stand against the OFT’s
plans would be likely to have more influence with the industry watchdog
than the current protests, which publishers claim have been ignored.

Current
laws force newsagents to buy all their titles from specific wholesalers
in return for the guarantee of getting access to all titles, however
niche-market they are.

The OFT says this is anti-competitive and
wants to open the market up to allow newsagents to pick and choose
their wholesalers to negotiate better deals. It has said it would make
a special exemption for newspapers because of their time sensitivity,
but would not allow magazines to have the same privilege.

The PPA has warned that thousands of small newsagents and independent titles could close if the ruling goes ahead.

Comments
No comments to display

Leave a Reply

Your email address will not be published. Required fields are marked *

sixteen − 11 =

CLOSE
CLOSE