Forty years ago, David Gilmour left Canada when his blazing comet of a stereo company, called Clairtone, crashed to Earth. Along with partner Peter Munk, he was forever branded with the legacy of Clairtone, which stands for innovative design and youthful overreaching.
Since the collapse of Clairtone, Mr. Gilmour has travelled the world pursuing and building businesses, including South Pacific resorts and the Fiji Water beverage company.
Now 78, he is once again a trailblazer as the owner of Zinio LLC, a U.S. company that bills itself as the world's biggest digital newsstand. Mr. Gilmour claims it will revolutionize the way people will read and interact with magazines. “This is my ninth and last business, and the most exciting thing I've ever been involved in,” he said on the phone from Zinio's New York marketing offices, which complement its technological base in San Francisco.
And now that business is coming to his home country. This week, Zinio and trade association Magazines Canada unveil a bilingual newsstand (magazinescanada.zinio.com), through which consumers will be able to read, retrieve, search, and save Canadian magazines in digital format.
Initially, about 100 titles have signed up for the newsstand, a mini-version of Zinio.com, which distributes 2,000 magazines and whose various offerings, Mr. Gilmour says, have a paid subscription list of five million people.
Mr. Gilmour has lost none of his promotional zeal, predicting Zinio will grow to 20 million subscribers within a year, as it ramps up marketing and as electronics manufacturers roll out a new generation of wafer-thin digital readers.
So far, Zinio does not make money, but Mr. Gilmour insists that should change as volumes grow. With every transaction – for a single copy or a subscription – Zinio takes a cut of the price, with magazines charging varying discounts to physical newsstand rates.
The big advantage to publishers is that the format avoids paper, printing and postage which add up to 40 per cent of a magazine's cost, he says. “I don't know of any business in the world where you can cut 40 per cent [of costs] at one time.”
The benefit for the consumer is being able to do as Mr. Gilmour does – sit on his beach in Fiji and receive his favourite magazine on his 11-inch Sony Vaio's screen the moment it is published. What's more, he says Zinio can work with publishers to achieve high interactivity, allowing readers, for example, to make purchases right off a magazine's or catalogue's digital ad pages.
Zinio is the latest turn in the road since Mr. Gilmour, a patrician-looking Winnipegger, teamed up with an energetic Hungarian immigrant, Mr. Munk, to found Clairtone in the late 1950s.
The company was lauded for its cutting-edge design, including its distinctive globe-shaped speakers. But it lost its way as public subsidies lured it to Nova Scotia from Toronto and it burned through a lot of cash. The founders lost control and the company was dissolved, leaving angry investors.
Mr. Munk and Mr. Gilmour remain close friends, but their careers have taken different routes. Mr. Munk created empires – in property and, most spectacularly, precious metals as the builder of Barrick Gold Corp., the massive gold producer.
While he was an early investor in Barrick, Mr. Gilmour has bought and sold smaller companies, including Fiji Water, the bottled-water purveyor he sold to U.S. pomegranate queen Lynda Resnick and her husband, Stewart, in 2004.
“I'm not interested in being the world's biggest water boy,” he said, adding that the excitement for him lay in building businesses, not commanding large organizations.
He began working on the idea of a magazine aimed at women over 30, who he says make 80 per cent of the spending decisions in the economy. At the last moment, he decided to publish the magazine, called Viv Mag, in digital format. That brought him to a software company, Zinio, that was building digital publishing platforms. He concluded it was on to a good thing and he bought the entire company in 2007.
He says he offered Mr. Munk the chance to buy in, but his friend turned it down. “Being the world's largest gold miner is not my way of life and my way of life is not his,” Mr. Gilmour says. But, “we both got our PhDs at the same school of hard knocks.”
That school was, of course, Clairtone. He claims he derived two big lessons from his famous failure: Don't rely on government for your funding, and stay away from excessive debt. Thus, he says, Zinio is entirely debt-free.
Mark Jamison, CEO of Magazines Canada, says a committee of his association looked at a half-dozen possible digital providers but Zinio was the best option in user-friendly applications. Magazines as varied as Cottage Life and Chatelaine have signed up, offering single issues and subscriptions.
Asked whether Zinio represents the future of magazines, Mr. Jamison says “it is one of the futures of magazines.” He insists print is not going away any time soon, but publishers have decided to move their content to multiple platforms.
Zinio is an effective medium, he says, “because it maintains a lot of the integrity of the things we know and love in print.”
