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If you believe the rhetoric of consumer magazine publishers, the industry is now heading towards its deepest crisis in living memory. It's all to do with distribution - an unsexy mechanism that everyone took for granted but which is about to be turned on its head thanks to an Office of Fair Trading investigation.

Under current arrangements, distribution companies are allocated geographical territories where they are allowed to operate a monopoly - in return for which they must supply all relevant retailers with the titles they want on a more or less equal footing. The OFT now seems committed to abolishing that "exclusive territory system" for magazines (although it will allow the system to continue for newspapers).

The knock-on effects are easy to plot. The existing big players will consolidate; and among the players gaining power will be the major retailers, notably Tesco. The bigger players will inevitably cherry-pick the best territories and neglect others. Small newsagents will be forced to carry a reduced range of titles and many local corner shops will just stop selling magazines.

In this vision of the future, smaller niche titles will inevitably go to the wall. The industry had been lobbying the OFT, confident that once the scales had fallen from its eyes, it would change tack. In March, a group of editors, including Vogue's Alexandra Shulman and GQ's Dylan Jones, wrote to Tony Blair arguing that the magazine business would face a pernicious form of censorship if the OFT gets its way.

However, the OFT has indicated in a "provisional written opinion" that it remains unswayed. Ian Locks, the chief executive of the Periodical Publishers Association, says the campaign will continue. "Magazine publishers look forward to discussing their concerns with the OFT and we are still optimistic that, before issuing any final opinion, the OFT will accept that unravelling the current supply chain would benefit only the giant supermarkets," he says.

We shall see. But should any of this worry the ad industry? After all, advertisers are only really interested in the large-circulation mainstream titles from the major publishers, aren't they?

Nonsense, Alison Brolls, the global marketing and media manager of Nokia, says. She states: "Publishers are right. Potentially, the biggest losers are smaller specialist titles. And what happens to the plethora of small-circulating lifestyle titles? The celebrity, home interest, style and fashion sectors are not only crowded with choice but are chock-full of niche-within-a-niche titles. Cut off their supply and they may well have to say goodbye."

Brolls argues that these sorts of magazines help keep the whole medium on its toes. And she adds: "On an advertising level, they provide finely targeted routes while delivering good cut-through with minimal wastage.

Many advertisers with niche-targeted products rely on such channels, especially given the congested nature of today's mainstream media landscape."

Marc Mendoza, the chief executive of Media Planning Group, is responsible for press issues on the IPA's media policy group. He agrees that there could be a "much, much greater concentration of power" into the hands of supermarkets. He explains: "Tesco already has a significant amount of power and there have been worries in the past about the sort of influence it has tried to exert. The danger for Tesco, the company that everybody loves, is that it turns itself into the supermarket everyone hates."

Mendoza argues that the small newsagent is as much a part of British tradition as warm beer and cricket. "Once supermarkets start telling publishers what to do, you will very quickly begin to lose diversity and variety in the magazine market. We all know how important it is for some products to target early-adopters - and early-adopters often read slightly anoraky titles."

Caroline Jones, the group head press buyer at Starcom Mediavest, admits that many buyers are bracing themselves for upheaval in the medium. She concludes: "The very existence of (specialist and small-circulation) titles proves there is a market for them and it's in our interest that they survive - and it's probably true that the advertising industry could do more to put pressure on the OFT. Maybe some people console themselves with the thought that the whole thing may take a long time to go through - but I think it's also true that many now believe there will be a significant change in the magazine market."

YES - Ian Locks, chief executive, PPA

"We are disappointed that the OFT has not yet recognised in its provisional statement the immense damage we believe would be caused to magazines through increased costs, reduced sales and loss of choice for the consumer."

YES - Alison Brolls, global marketing and media manager, Nokia

"This is worrying. Often, it is smaller titles that keep the market refreshed and rejuvenated. For example, a magazine such as Golf Punk could hardly ever come from a large publishing consortium."

YES - Marc Mendoza, chief executive, MPG

"Often, we're talking about the sorts of titles that are mocked on Have I Got News For You. But if each niche title loses 20 per cent of its circulation, we are talking about huge change when you consider the magazine market in the round."

YES - Caroline Jones, group head press buyer, Starcom Mediavest

"The big publishers will get the best places on the supermarket shelves. Smaller publishers are likely to suffer in the long run. Most media specialists have a range of clients who view these titles as important."

- Got a view? E-mail us at campaign@haynet.com.