Mumbai: The chairman and chief executive officer of the eponymous publishing company Forbes Media Llc, and editor-in-chief of Forbes, Steve Forbes, does not mince words. He was in Mumbai to launch the Indian edition of his popular business magazine, which hit the newsstands in collaboration with Network18 Media and Investments Ltd. Forbes spoke about what the magazine’s iconic list of the world’s richest tell us about economies, the inability of many media companies to embrace the Internet and how Prime Minister Manmohan Singh can teach a thing or two about good economics to US President Barack Obama. Edited excerpts.
The ‘Forbes’ rich list generates a lot of interest in India. But wealth these days is more transient if one goes by your lists.
‘Light years ahead’: Forbes says the long-standing tradition of the rule of law puts India well ahead of many other countries, and the fact that English is spoken here gives it an added advantage in global business. Ashesh Shah / Mint
The list will give very valuable insights not just on wealthy individuals, but also the changing nature of the national and global economy. You touched on the turnaround on the list. It is remarkable. We tend to think of wealth as physical things. But wealth is mostly metaphysical: It is based on perceptions. Technology can change circumstances.
Wealth can very rapidly increase or decrease. Just to give you one example. In the US, we did a first list in 1982—the 400 richest Americans. That list was full of Rockefellers and Duponts. Today, there is not one Dupont in our Forbes list. The only Rockefeller in the list is David Rockefeller, who is 90 years old. I think it’s a sign of a dynamic economy.
This year, our list of global billionaires was down. Indians took a hit as well, including (the subject of) our first cover story (L.N. Mittal of ArcelorMittal). But those things are temporary.
We believe the crisis will be over in a few months. The long-term trend expansion of global economies and the rise of global wealth and the rise of new entrepreneurs will continue. That’s the virtue of entrepreneurial capitalism.
That’s the reason for people from unlikely backgrounds to achieve great success. Whoever thought that 20 years ago that an Indian entrepreneur will create the world’s largest steel company? Just as in the US, Bill Gates dropped out of Harvard, Larry Ellison was an orphan, Steve Jobs was given up by his biological parents. These people rise up and achieve great things even as many people fail. The striving of people trying to create new things enables us to move forward.
What made you to bring the ‘Forbes’ brand to India?
The Indian economy has made enormous strides since 1991. We believed that India has a fantastic future, even before the recent elections.
One is the long-standing tradition of the rule of law. Which many other countries in the globe are just developing. You are light years ahead of them. The fact that English language is spoken here gives the added advantage, as English is the lingua franca of global business. And bind that with liberalization of 1991, presumably the new (Indian) government will push for some reforms so that the country can truly create economic zones to facilitate growth. So India is in a position that US was in the 19th century.
These are very trying times for the US media industry. Where do you see the road ahead for the media industry?
Well, the hurricane-like force of the Internet has been there for years. Craigslist very clearly is going to decimate a huge source of income for newspapers. But compounding those pressures has been the financial crisis, which has temporarily devastated the advertising market. So, you are hit on both sides, the cyclical downturn and a game changer from new technology.
Thankfully, Forbes from the beginning didn’t see the Web as a threat to the print media. We saw it as another way to reach our core constituency which is entrepreneurial business people, investors, and so we nurtured the website. It has some 20 million visitors per month.
Does the website make money?
It turned profitable in 2003.
Revenues on the Web are not what they are in the print side, but it’s a different dynamic and so it is more profitable. Now, we see the Web strong enough to integrate (print and online offerings). So, we are in the process of bringing together the editorial teams of both sides. In this modern day in journalism you have to be multiplatform. You have to have the skills for more than one platform.
That process is under way at Forbes.
How do you assess President Obama’s initial days in the White House?
They (Obama administrating) still needs a lot of educating on the importance of free trade. They came in with a very parochial attitude, that was to please their local constituents. President Obama signing the legislation banning trucks from Mexico is a flagrant violation of the international trade agreement with Mexico.
That was done to pay off the Teamsters union that supported Obama when he was running for the presidency. In recent days they have backed off some of their extreme protectionist rhetoric from the campaign days. But they have to grasp that they are in Washington and not in Chicago. It’s an educative process.
When the new government is formed in, I hope the Indian Prime Minister will visit President Obama and assist in his educating process.
Has India changed in your perception?
I was in Mumbai in 1995. I see some changes in terms of the city’s physical look. In a more profound way, I see a psychological change. There’s an energy in the air. Presumably, the new government will move more vigorously in investing in infrastructure (laughs).