The newspaper industry in the U.S. continues to lose ground to the instant satisfaction offered by internet news, but magazines and books are still a decent business for many publishers. When Wal-Mart Stores, Inc. (NYSE: WMT) announces that it will stop carrying about 1,000 magazine titles on its store shelves, though, one has to wonder about the future of the publishing industry.The world's largest retailer has announced the discontinuation of mostly smaller magazine titles; the real question is what took it so long. Shelf space at Wal-Mart is absolutely critical, and dedicating a 20-foot section of the store to quite a few slow-moving titles is probably no longer a sound business decision. Small titles like Celebrity Living, Elle Girl, Teen People, Suede and others have been given the boot, and almost every major magazine publisher was hit when Wal-Mart announced the change.
It's believed that Wal-Mart generates about 20% of all retail magazine sales in the U.S. -- so dropping a thousand titles is a major problem for the publishing industry. The big question is this: will Wal-Mart dedicate more display space for fast-moving magazines in an effort to turn more inventory, or will magazine sections in Wal-Mart stores be downsized to make room for more lucrative, higher-margin products? The answer will be coming soon to a Wal-Mart near you.
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