CRASH - The Online Edition
- Issue 99 Contents|
Newsfield started as a partnership in June 1983 under ownership of Roger Kean, Oliver Frey and Franco Frey and operated initially as a software mail order house for the then burgeoning Sinclair Spectrum market. The mail order catalogues produced were so well received by the industry that it was decided to launch a monthly computer magazine dedicated solely to the Spectrum games and entertainment market. To this purpose the partners set up a limited company on 5 October 1983 with equal shareholding, which integrated the mail order activities with the future publishing activities. The monthly magazine CRASH was proposed to WH Smith, accepted and was duly launched on 13 January 1984 at a cover price of 75p. The magazine was immediately successful and built up to an ABC audited circulation in excess of 100,000 within two years.
Shortly after launch, Crash's news trade distributor Wells Gardner Darton went into receivership and the income from issue one and two never materialised. Comag was appointed as new distributor and partially salvaged issue two income from the wholesalers. Comag went on to do an excellent job in building up Newsfield's circulation and were retained for the whole period of trading.
From an initial bedroom operation Newsfield leased office premises in 1/2 King Street, in the centre of Ludlow, and took on staff to run the publishing and mail order operation, although the shareholder directors continued in a hands-on approach.
With an improved cash flow situation Newsfield was prepared to launch a sister title to Crash by the name of Zzap! to cover the booming Commodore C64 market and so a new Editor was employed, who formed a new editorial team and operated at arm's length from Yeovil. The first issue of the monthly Zzap! appeared on 13 March 1985 at a cover price of 95p. The magazine was immediately successful and went on to build up an ABC audited circulation in excess of 68,000 within 18 months. Disagreements over the direction of Zzap! led to the Editors' contract being terminated, with two of his team being moved back to Ludlow.
With two libel cases in progress, the shareholders decided under advice from the company's auditors to restructure the Newsfield operations under a group of companies in order to protect unaffected parts of the business from potential claims. Newsfield Publications Limited acted as the holding company, while Newsfield Limited and any other existing and future companies would become fully owned subsidiaries.
The regular editorial contact with software programmers led to the formation of Thalamus Limited, a subsidiary dedicated to the publication of entertainment software. The activities consisted of supervising the development work of freelance programmers, who produced games software under the royalty contracts, and the production and marketing of the end products. Due to the people employed to run this operation, Thalamus set up its headquarters in Aldermaston and continued to operate from there with minimal staff, but with major assistance from the Ludlow production and administration team.
Looking to expand further in the booming computer entertainment market Newsfield launched a further monthly title by the name of AMTIX, which provided coverage of the then new Amstrad CPC machines. A new Editor was taken on for this magazine. The first issue appeared in October of 1985 at a cover price of £1. Unfortunately, Amstrad never developed a huge following in the games market and Amtix never achieved successful circulation figures. After 18 issues Amtix was sold off to Database Publications.
In order to strengthen the management base two directors were appointed to the board. John Fellows joined as Financial Director and Roger Bennett as Group Advertisement Director.
In 1986 designs were made to expand into areas outside the computing world and with Newsfield's background knowledge of the teenage market the decision was taken to launch into the male teenage market area with a lifestyle magazine. LM was launched in December 1986 and was the largest project Newsfield had ever tackled. LM required a London Office and a total of seven editorial staff. A dummy issue was produced and coverbound onto Crash and Zzap! prior to the launch to create market awareness and a TV commercial produced and run in selected regional areas. While LM generated instant street cred and attracted a core of die-hard fans through the UK, initial circulation turned out to be disappointing but nonetheless with an upward trend. Advertisement income however did not match expectations and promises from some of the major national consumer advertisers and media agency account handlers, who felt that LM was not presenting the right image, certainly not the glossy and stylish look of its contemporary. With very little ad income and massive drainage of resources LM was not given the time to develop its [potential as] a cult magazine and the plug had to be pulled after issue 4.
The write-off of the LM project investment affected the year's financial results, but with both Crash and Zzap! showing strong profitability, Newsfield recovered enough to launch a further computer title, THE GAMES MACHINE to capture the wave of new machines such as the Amiga, Atari ST and the Japanese consoles Sega and Nintendo. The first issue of TGM appeared in September of 1987 with a cover price of £1.25 and while it contributed to the general overheads, it did not achieve market leading status, partly because of the stiff competition, partly because it was a multi-format magazine and the market was favouring machine-specific titles. The company now employed in excess of 50 staff and had spilled out of King Street into separate offices in 47 Gravel Hill by mid-1986. Further office space was required in 1987 and this was found in 58 Broad Street. Computer editorial and magazine production remained in King Street, general admin and mail order in Gravel Hill, while the advertisement department occupied Broad Street. The physical separation of departments had a detrimental effect on the flow of information and created inter-company factions and divisions which at one point in time culminated in a complete breakdown of activities within the company. Unfortunately no large office premises were to be found in the vicinity of Ludlow.
The financial situation however improved further and to such an extent that by mid 1988 a new project could be tackled. With the boom gradually fading in the lower end of the computer entertainment market, a second attempt was made to expand outside this volatile area and a new promising consumer market was sought.
One opportunity arose with the approach of John Gilbert and his proposal of a fanzine covering the horror and science fiction genre. This was a low-cost project and Newsfield agreed to publish FEAR under contract with John Gilbert. FEAR was launched in June of 1988 with a cover price of £2.50. As expected, the magazine achieved only limited circulation figures and with a very low advertisement income, continued with only marginal results up to the end of Newsfield's trading period.
The second opportunity showed more promise. The video industry was shedding its tacky blue-movie image and was at the verge of building up the sell-through market in parallel to its already strong rental business here in the UK. With lower sell-through prices (£9.99-14.99) major sales were expected with households building up libraries of their favourite movies. Newsfield decided to launch a magazine which reflected the new upmarket video image and concentrated on the software, not the hardware. MOVIE THE VIDEO MAGAZINE was launched in September of 1988 with a cover price of £1.90. Similar to LM, it required a London editorial office due to the London bias of the business. MOVIE succeeded in attracting the very reticent video distributors to advertise in a non-trade magazine, and was instantly accepted by the trade. Unfortunately expectations had been set too high as regards the regular monthly marketing budgets of the industry and also circulation pickup was very poor, so much so, that with issue 7 the title had to be dropped. Emap's publication EMPIRE, launched within the same time span, but ostensibly aimed more at the cinema release market, enjoyed the support of its publisher's deeper pockets and has developed since into a market leader embracing video release product.
With the second major launch failure Newsfield found itself in a serious financial situation, and it required the sacrificing of its two major profit makers to recover. Both Crash and Zzap! were put on firm sale to maximise profitability in the short term, but with major effect long term by stilting their circulation through natural reduction of news trade orders. Despite these measures profitability was dropping as by now the 8-bit computer market, ie. the Spectrum and Commodore C64 machines, was suffering badly from the influx of new, more powerful 16-bit machines such as the Amiga and Atari ST. Adding to the problems, Comag specifically, and the news trade as a whole, was operating with increasing inefficiency, which meant that news trade order levels on firm sale titles were allowed to drop at an alarming rate and sales of Sale-Or-Return titles were not maximised with poor box out figures and poor sales representations. The news trade distributors reverted back to wholesale support only, expecting the publishers themselves to do their own marketing and repping at wholesale and multiple levels, which created insoluble problems for small publishers without their own distribution force. Advertisement income dropped alarmingly at the beginning of 1990 and then again in 1991 to such an extent that comparisons of the October issues of Zzap! showed the 1991 figures to be only 25% of those of 1990.
The Apple Macintosh was developing specifically in the professional publishing area and with the in-house experience of applying this latest technology of electronic page make-up it was decided to branch out into the professional subscription-led magazine market. PREPRESS WITH THE MACINTOSH was launched in September of 1989 and catered for companies in the publishing market. The initial marketing drive at exhibitions and through carefully targeted mailshots provided poor paid subscription yields, although the magazine came to be highly regarded by the trade. As PREPRESS was not paying its way by a long margin, it was necessary to change course and to concentrate on advertisement income whilst expanding the circulation to include targeted complimentary distribution to provide the necessary advertising yield. This change was effected successfully and with the repositioning of the title to include PC material advertisement income started to increase to a level which allowed PREPRESS to break even and with further projected increases even to contribute to the companies profits. In the meantime however the project had eaten up valuable resources without having fulfilled its promises yet, resources vital for the other company's activities.
Without increasing overheads and with existing staff, effort was made to increase turnover and improve profitability with the launch of a quarterly buyers' guide, THE COMPLETE COMPUTER ENTERTAINMENT GUIDE, or CCEG in short. The first issue appeared in November 1989, with a cover price of £1.95 and two further issues were produced, one a year later in November 1990 and the other in March 1991.
In mid 1989 Newsfield was offered the opportunity to take a five year leasehold of a mill building, which was to be modernised and customised to suit its requirements and which would enable it to integrate all company activities under one roof. Newsfield agreed and in March 1990 the renovation and extension work was completed and the move finally made.
In mid 1990 Croftward Publishing ceased trading and Newsfield was approached by the editorial team of GM, a monthly magazine for fantasy and role playing addicts, to take over the publication. With the knowledge of its former circulation and advertisement income history, Newsfield decided to launch GAMES MASTER INTERNATIONAL on a low-budget and the first issue hit the news stand in July 1990. Unfortunately the gaming market was in deep recession and both circulation and advertisement income targets were never achieved.
Meanwhile, with the new Japanese games consoles rapidly gaining substantial market shares in the computer entertainment market, it was decided to revamp THE GAMES MACHINE to improve coverage of these particular machines and the magazine was replaced with a new title, RAZE. A new editorial team was required and former contributing editor Richard Monteiro, having formed the company Words Works Limited, set up office in Trowbridge with his own editorial team and produced RAZE editorial under subcontract.
The first issue of RAZE appeared in October 1990 with a cover price of £1.95. With both mediocre advertisement income, insignificant circulation figures and expensive out-of-house editorial RAZE was a marginal product.
In order to improve dwindling turnover, a spin-off from FEAR was launched in June 1991. The monthly magazine was called FRIGHTENERS and had a cover price of £1.50. It consisted of selected short stories from famous and unknown authors, who were keen to find an outlet for their publishing efforts. Unfortunately, a Menzies customer found offence in a Graham Masterton short story and the news trade pulled issue one out of circulation, which meant that Newsfield had to virtually write the first issue off. Subsequent issues were distributed under counsel's clearance.
With the limited effort of RAZE and a meteoric boom of both Sega and Nintendo video games, Newsfield decided to replace RAZE with two system-specific magazines. Both SEGA FORCE and NINTENDO FORCE were to be launched in October 1991. New staff were taken on, while at the same time Words Works was given notice that its contract would not be renewed after issue 13 of RAZE, the final issue. Work commenced on the new titles.
Despite major cuts in spending both in overheads and direct costs, Newsfield was not operating at a profit during the lean summer period. In March of 1991 Jonathan Rignall was internally promoted from production manager to managing director and proceeded to set up a business plan with a clear goal to reduce costs even further and plan a product strategy for survival. While the pessimistic projections in May 1991 for the year to March 1992 indicated worthwhile profits in the more lucrative winter period, both feedback of advertisement income and circulation figures for the more profitable September and October issues indicated substantial shortfalls on the projected figures. The company auditors, who were called in to prepare the annual results, confirmed the poor yearly results and advised the board of directors that due to the balance sheet showing an insolvent position and on the basis of unrealisable projections up to March 1992, the only course of action available to the board was to put the company into voluntary liquidation. On 17 September Mr Ian Clark from Kidsons Impey & Partners was called in and the resolution to wind-up the insolvent company was duly signed and the staff laid off.
Newsfield established itself during the initial computer boom period with two very strong titles, Crash and Zzap!, but failed to follow up its initial success with further profitable titles to consolidate its position. It was clear that the company needed to find lucrative replacement products before the particular market areas, the Sinclair and Commodore C64 markets, would decline and gradually fade away. Unfortunately none of the efforts within and outside of the computer market area proved to be successful and left the company in a very vulnerable position.
All the five Directors were responsible for the day to day running of the company and were in receipt of total salary of £98,280. However, the Directors Salaries were paid by Newsfield Publications Limited.