THE deep difficulties faced by IT publisher Penton Media have highlighted the severe downturn in advertising across the technology media sector.

Published in The Australian, December 19 2002

These have been tough times for technology publishers. The dotcom boom of the late 1990s saw existing magazine circulations rise and the launch of half-a-dozen new titles, while newspapers added daily coverage of the technology scene to their business sections. Once the tech market crashed, most of the expanded coverage disappeared and the employment options for IT journalists become more limited.

However, there are signs of a turnaround. The most notable is a series of poaching raids by national newspapers on specialist IT publishers. Indeed, after a recent series of hires by The Australian and The Australian Financial Review, one specialist publisher, Penton Media, has been left with just two journalists. Two years ago, Penton employed about a dozen writers.

The Australian has recently revamped and expanded its Tuesday IT section and added a new page of IT business coverage on Thursdays, managed by ex-Penton editor and the newspaper's telecommunications writer, Michael Sainsbury. The AFR has also expanded its coverage after the return of former section editor David Crowe from a stint in small business.

"The Penton team were considered the most aggressive and confrontational news team in the industry," says Philip Sim, managing director of IT media consultancy MediaConnect.

Sim argues that smaller titles provide better training grounds: "Few publishers place enough importance on mentoring young staff." Stuart Kennedy, who shifts from Penton to take over as editor of The Australian's IT section in January, agrees that working in a smaller environment can help develop technology writing skills.

Whatever the motives, moving from Penton might well be seen as a timely exit. The company has cut back on its range of titles in the past year, and recently reduced the size of the controlled circulation on its remaining titles Computer Reseller News, Information Week and Windows For Professionals. As Media went to press, negotiations were being finalised to sell the local Penton operation to rival technology publisher AJB.

Penton's former owner David Richards, who sold his publishing company to Penton for $US2.4 million in 2000, has openly declared that a sale will void his non-compete clause with Penton and that he will immediately launch new titles. However, Richards wants to concentrate on online distribution and news content rather than product-oriented print titles.

The reasons for Penton's demise may lie beyond the loss of key staff. Insiders say the Penton deal to buy Richard's DWR Media was botched. The US company brought in former managing director of failed broadband portal Chello, Philip Alexander, on a salary of $250,000, a big whack for a small company. But the aggressive and entrepreneurial Richards stayed on, creating an environment former staff said was tense and almost unworkable.

All this activity should lead to an increasingly competitive IT publishing scene. "There's definitely a turf war happening between the newspapers over who has the premier technology section," says Sim.

But will there be advertising to match? Market watcher IDC is predicting that PC sales won't pick up until the second half of 2003, so publishers aspiring to catch the next technology boom will need deep pockets.

"Everyone's taking a bit of a bet that the technology advertising market is going to pick up," says Sim.