Let me start off by saying that I firmly believe mygazines.com is a blatant copyright infringer and deserves whatever penalties it might eventually receive. I say "might" because it's an offshore operation which means it will be tough to hunt down and hold anyone accountable for the website's activities.
My concern isn't about whether mygazines is legal or not (it's not), but rather about how the magazine industry should respond to it. The music industry crushed Napster because the major labels couldn't come up with any other solutions. I tend to agree with most of the points made by both Ian Da Silva in this Wikinomics blog post as well as what The Motley Fool has to say in this article (although I certainly don't agree with the Fool's suggestion that this is "the end of publishing as we know it"!)
This is a golden opportunity for the magazine industry to see how a Napster-like platform for periodicals could and should work effectively. Mygazines is essentially doing e-content R&D for the entire magazine industry; I just hope the industry takes the time to study and understand the results before they look to kill the service.
I took a quick look at mygazines and immediately felt like it would be worth paying a subscription for, provided all the content was legal. I've been letting most of my magazine subscriptions lapse because I find more up-to-date info online and I can't justify the price. That's one more set of eyeballs each of those magazines just lost for their advertising income. So in addition to possibly getting mygazines shut down, why not figure out how this model could actually help rebuild readership and advertising income?
If a coalition of magazine publishers managed to intervene and kill mygazines, but take it over in the process, would that be a good thing? Possibly. Would I pay $5/month to have access like this to several magazines I'm not currently subscribing to? Absolutely. In fact, if they build in the right social networking capabilities it could easily become an extremely popular alternative for a lot of customers. I just hope the magazine industry takes the time to learn what it can from this before they focus on crushing it.
P.S. -- Speaking of magazines, I have a short update to the BusinessWeek subscription I let lapse earlier this summer. They stopped sending issues shortly after I posted that note back in June and I have to admit that I miss the service. I'm greatly disappointed that it's not offered on the Kindle but a renewal offer I received over the weekend has tempted me to return. The deal is $20 for a full year's worth of issues. I'm pretty sure I can't say no...
P.P.S -- Well, it turns out the slick folks at BusinessWeek were simply trying to pull a fast one on me. Upon closer inspection this new $20 deal is only for six months, not a full year. When I balked at $40 for a year some wisenheimer there apparently decided to toss a "$20 for six months" offer at me instead. Silly me...I almost fell for it!