Source Interlink, Time reach distribution agreement

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Source Interlink Cos., the magazine distribution and fulfillment company that recently brought lawsuits against many of the nation's largest publishers, has settled its dispute with Time Inc.

The suit, filed just over a week ago, accused Time Inc. and others of conspiring to drive Source out of business. It was filed after Source and the now-defunct Anderson attempted to raise rates by seven cents per issue. The proposed rate hike raised publishers' ire, but no cash for the distributors, as many magazine companies simply started searching for a new distributor. Source later cancelled the rate hike, but had little success convincing publishers to come back.

When the suit was filed, Time Inc. took a hard line. “We believe the lawsuit is without merit, and we will defend ourselves vigorously,” Time Inc. spokesperson Dawn Bridges said of the case.

Now, however, Source and time have signed a new, multi-year distribution agreement – with no per-copy fee. Why the change of heart?

Representatives from Time Inc. declined to comment aside from the official company statement, which read, “Time Inc. has reached an agreement with Source Interlink to distribute Time Inc. magazines. The multi-year agreement provides benefits to both parties. Time Inc. is pleased with the new terms, which include no per-copy fee, and believes the agreement provides the foundation for a strong ongoing business relationship with Source.”

Representatives from Source had not returned calls as of press time.

There is also no word on whether settlements have been reached with others named in the suit, such as Bauer Publishing Co., Hachette Filipacchi Media and Curtis Circulation Co.

The fear, when the trouble between Source and publishers started, was that magazine flow to newsstands would be interrupted, decimating magazines' already flagging single copy sales numbers. Newsstand sales for US consumer magazines were down more than 11% between 2007 and 2008, but the short-lived standoff seems to not have lowered these numbers any more.

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