Tag Archives: BusinessWeek
Here’s one of them:
“Bloombergâ€™s thousands of terminals are rented monthly around the world, mainly by financial traders. The subscriber base for BusinessWeek is a different category — the men and women who make up American industry.
“Bloomberg hopes to be able to market their products to them. And by putting its content in front of this audience, they hope to turn them into sources.
“That gets at a conundrum I hear all the time:Â international wire services cannot get access to the top executives and sources in industries that tend to be niche, and communal. That is why a niche publication like TheWrap — though much smaller, and nominally less powerful — can get to news that Reuters or AP or Bloomberg could not possibly. Same for BusinessWeek.
“Business people want to speak to the news organizations that they and their peers read by themselves. And no one who’s not in finance reads Bloomberg.”
Read more here.
New York mayor Michael Bloomberg approves of the proposed acquisition of BusinessWeek by Bloomberg LP, the company he founded and still owns majority control, although he’s no longer involved in the decision-making, writes David Chen of the New York Times.
Chen writes, “‘They told me that they wanted to look at it,’ Mr. Bloomberg said during an appearance in Manhattan on an unrelated matter. ‘I certainly didnâ€™t have any objections to it. I think itâ€™s a great magazine.’
“Mr. Bloomberg went on to give his own take on the problems plaguing the publishing industry, suggesting that magazines and newspapers that were failing were simply not giving the people what they wanted.
“‘The magazine business â€” my personal opinion is â€” has fallen on hard times because of the economy, and the economy will come back,’ Mr. Bloomberg said. ‘I am very optimistic, as you know, about New York Cityâ€™s economy, and one would hope that that magazine would benefit going forward.’
“He continued: ‘Iâ€™ve never believed that print is dead. Iâ€™ve always believed that there are two problems with print journalism today. One is lack of advertising, some parts of which will come back, and two, when nobody is buying your magazine or your newspaper, itâ€™s because youâ€™re not writing what people want to read.’”
Read more here.
Ledbetter writes, “No, I think the real motivation behind the buy is Businessweek.com. Yes, Bloomberg will probably keep the weekly magazine, using the ugly name Bloomberg BusinessWeek. It will slash the staff, and probably try to find a way to repurpose Bloomberg material in its pages.
“But with Businessweek.com, Bloomberg is getting a Web site with lots of readers and lots of upside potential. According to compete.com, Businessweek.com hasÂ more thanÂ 5 million unique visitors a month, about as many as Bloomberg.com. And those figures are probably low because of Competeâ€™s tendency to undercount; I imagine the real number is closer to 8 million uniques.
“That in and of itself is a viable business, and at $15 million is a major bargain. Consider that last year, Guardian Media bought PaidContent for $30 million, and that site has a monthly audience of maybe 250,000. Yeah, OK, PaidContent has other businesses, and Guardian clearly overpaid, but Iâ€™d say Norm Pearlstine and Bloomberg have just snatched up a major player in the online business journalism world for a song, and hardly anyone has noticed.”
Read more here.
Marketwatch.com media columnist Jon Friedman, a former writer at both BusinessWeek and Bloomberg, writes that the deal to acquire the business weekly magazine by the terminal and data company doesn’t make much sense to him.
Friedman writes, “So far, Bloomberg has yet to dominate any of the consumer-oriented businesses that it rolled out in support of its flagship enterprise, the highly respected Bloomberg Terminal. It is a staple for Wall Street traders and bankers because of the blizzard of data and news that it offers.
“Further, why is Bloomberg eager to acquire an 80-year-old weekly business magazine, which is likely to lose money? It has dim prospects for the near future because of the media’s uncertain prospects for advertising revenue in newspapers and magazines.
“You’d hate to conclude that privately owned Bloomberg is doing this deal because of a desire to satisfy an executive’s ego. Still, it seems likely that whoever is driving this proposed acquisition will get a great deal of criticism.”
Read more here.
Ives writes, “To energize and improve BusinessWeek’s editorial product, then, the new owners plan to increase the number of editorial pages in every issue, tapping Bloomberg’s 2,200 existing journalists.
“‘We think that given the global reach and assets available to us at Bloomberg, combined with BusinessWeek, we can just put out a great magazine,’ Mr. Pearlstine said in an interview Tuesday night. ‘If we do that, we will be rewarded with consumer demand and advertising will follow.’
“It’s not just advertising, though, in Bloomberg’s crosshairs. It’s also eyeing better circulation economics, a priority that too many magazine publishers have thrown overboard in the desperate hunt for ad dollars. ‘Right now the subscription price is $35 annually,’ Mr. Doctoroff said. ‘The Economist is $106. We’ve got to improve the product and make BusinessWeek a must-have.’
“That’s not to say Bloomberg will ignore the chance to sell ads across its newly combined products facing consumers. ‘The other opportunity exists online, where between the two sites, Bloomberg.com and BusinessWeek.com, we’ll have roughly 8 million uniques, which are more than any other non-portal business and financial site,’ Mr. Doctoroff said. ‘Interestingly they have virtually no overlap in terms of advertisers and relatively little overlap in terms of viewers. That is a big opportunity.’”
Read more here.
TALKING BIZ NEWS EXCLUSIVE
Here is the text of an e-mail sent to the BusinessWeek staff from president Keith Fox, obtained by Talking Biz News:
“Moments ago, McGraw-Hill announced that Bloomberg L.P. has agreed to acquire BusinessWeek. This is exciting news on many levels. Joining forces with another of the worldâ€™s leading news organizations enhances BusinessWeekâ€™s ability to further serve our global audience and our valued customers. And Bloomberg will gain a powerful brand with a history of editorial excellence and strong reach among business professionals.
“While the ink is barely dry and the long-term plans are being worked out, we do know that Bloomberg is committed to and values our brand, our editorial integrity, and our ability to drive advertising, circulation, and new digital revenue.
“BusinessWeek will strengthen Bloombergâ€™s online, television and mobile products and creates an opportunity for Bloomberg News to reach decision makers in the c-suite. Online, BusinessWeek.com and Bloomberg.com will have more unique visitors than any non-portal business and financial site. In addition, Bloomberg expects to build television content around the powerful BusinessWeek brand and our world-class journalists.
“I am tremendously proud of the work all of you have done in the past few months. Despite the uncertainty, we have continued to produce first-class products for our readers and advertisers, and I want to thank you deeply for your efforts. I also want to thank Steve Adler, Jessica Sibley, Tania Secor, Roger Neal, and Linda Brennan, for their extraordinary ability to personify the best of BusinessWeek during the deal process while leading their respective organizations.
“I know that while this announcement answers some of the questions youâ€™ve been asking over the past few months, it raises others. The sale is expected to close by the end of the year and we will be working on transition plans in the coming weeks. I can tell you that all BusinessWeek staffers will remain employees of The McGraw-Hill Companies until the transaction closes, and that it will be business as usual — producing the magazine and the website, and serving our advertisers –through the close. We will give you more details when we can.
“Weâ€™ll be holding a town hall meeting later today at 5:45 EST, after which a Q&A will be provided to all employees; you will receive more details shortly. A call for the Asia teams will be scheduled shortly.
“Again, I want to thank you all for your professionalism and dedication during a challenging time. I look forward to working with you on the promising next chapter in BusinessWeekâ€™s history.”
Lowry writes, “But knowledgeable sources say that Bloombergâ€™s cash offer is in the $2 million to $5 million range and that it has agreed to assume liabilities, including potential severance payments. It remains to be seen how much of the magazineâ€™s 400-plus staff Bloomberg plans to cut, but reports of a planned scorched earth campaign are overblown, say sources.
“If the deal closes as anticipated by Dec. 1, it will be unprecedented for both buyer and seller. For Bloomberg, buying BusinessWeek will be its first major acquisition ever and a significant departure for a 28-year-old company nurtured on a ‘build, donâ€™t buy’ culture.”
Lowry later adds, “BusinessWeek, whose logo will eventually incorporate the Bloomberg name in some still-undetermined way, will continue to publish weekly in print and around the clock online. The goal will be to substantially boost the magazineâ€™s editorial pages. It still hasnâ€™t been decided whether Bloomberg and BusinessWeek will maintain separate Web sites or be morphed together as one. The sites combined attract more than 20 million unique visitors monthly and log roughly 100 million page views. Combined revenues of the sites alone are $60 million.”
Later, he notes, “BusinessWeek staff will be moved across town and into Bloombergâ€™s Manhattan headquarters by May 1. Officials from Bloomberg will begin meeting with the BusinessWeek staff in the coming weeks.”
Read more here.
Bloomberg L.P., the leading provider of news and information for financial professionals, has agreed to purchase BusinessWeek, publisher of the worldâ€™s mostread business weekly, from The McGraw-Hill Companies, Inc. Terms of the agreement were not disclosed.
“The BusinessWeek acquisition will yield huge benefits for users of the Bloomberg terminal, and for our television, online and mobile properties,” said Daniel L. Doctoroff, president of Bloomberg L.P. “We couldnâ€™t be more excited.”
“Although Bloomberg has built one of the worldâ€™s largest news organizations with more than 2,200 journalists, our primary audience has been our 300,000 BLOOMBERG PROFESSIONAL service subscribers. They rely on us for high-value, market-moving news and insightful analysis.
“BusinessWeek helps better serve our customers by reaching into the corporate suite and corridors of power in government, where news that affects markets and business is made by CEOs, CFOs, deal lawyers, bankers and government officials who typically are not terminal customers,” Doctoroff noted.
Bloomberg L.P. Chairman Peter T. Grauer said, “The acquisition of BusinessWeek will strengthen Bloombergâ€™s online, television and mobile products. Together, the BusinessWeek.com and the BLOOMBERG.COMWeb sites will have more unique visitors than any non-portal business and financial site. We also expect to build BLOOMBERG TELEVISION content around the powerful BusinessWeek brand and its world-class journalists.
“Bloombergâ€™s universe of market makers and BusinessWeekâ€™s readership of decision makers create a powerful audience and a unique value proposition for advertisers. The reporting and analytical resources of Bloomberg and BusinessWeek are unparalleled in their ability to deliver timely, distinctive and credible content to an influential and highly sought-after audience,” Grauer added.
Matthew Winkler, Editor-in-Chief of Bloomberg News said, “BusinessWeek, with its extraordinary context and perspective on the economy and companies, presents a giant opportunity for the BLOOMBERG NEWS service to reach decision makers in the most important industries. We are thrilled to have such experienced journalists as our colleagues.”
To facilitate integration of the two news organizations, Norman Pearlstine will become Chairman of BusinessWeek. Pearlstine, Bloombergâ€™s Chief Content Officer, joined Bloomberg last year, building on a distinguished career as Managing Editor of The Wall Street Journal and Editor in Chief of Time Inc. “Normâ€™s role will ensure that we fully capitalize on the combined strengths of Bloomberg and BusinessWeek,” Winkler said.
“Bloomberg looks forward to becoming steward of the great BusinessWeek franchise that McGraw-Hill has built over the past 80 years,â€ said Pearlstine. “We are uniquely positioned to preserve and build the market presence of BusinessWeek. Our shared values and complementary resources give us the editorial and technological expertise, data, analysis and depth of reporting to create a new model for the business weekly.”Â
BusinessWeek magazine, founded in 1929, is the market leader among business periodicals with more than 4.8 million readers each week in 140 countries, local language editions in Chinese, Thai and Bahasa Indonesian and licensees in 15 countries. Bloomberg is the number one source of essential breaking news stories, market coverage, investigative and enterprise reporting on global financial markets and the businesses, governments and individuals that rely on them.
In addition to BusinessWeek magazine, the BusinessWeek brand encompasses the BusinessWeek.com Web site, the Business Exchange online news and information service, SmallBiz magazine and BusinessWeek Events.
Doug McIntyre, the editor of 24/7 Wall Street, writes that BusinessWeek bidder Zelnick Media’s track record of involvement with some companies it has invested in has not been good.
McIntyre writes, “Whatever the track record of Zelnick Media may be with private transactions, Zelnick has been part of the management and/or boards at two public companies which has become disasters for shareholders.
“In May of 2005,Â Strauss Zelnick was part of the dream team of directors that Carl Icahn helped put on the BlockbusterÂ board of directors. Icahn joined the board himself. The other member of the group was Edward Bleier, a former Warner Bros. EntertainmentÂ executive. Since the three joined the board, Blockbusterâ€™s shares have dropped from $10 to $1. From 2005 to 2008 Blockbuster has had net losses of over $1 billion. Zelnick made $77,671 serving on the companyâ€™s board last year, according to its proxy.
“The situation at Take-Two Interactive, where Strauss Zelnick is the chairman, is even worse. Zelnick Media took over effective day-to-day control of Take-Two under a management contract in March 2007. The share price of the video game company was $23 then. The stock trades just above $11 now. The stock rose as high as high as $27 in mid-2008 when Electronic ArtsÂ made a bid to buy Take-Two. The board turned the offer down. Over its last four fiscal quarters ending July 31, Take-Two has had a net loss of $130 million, and revenue has declined each quarter over that period.”
Read more here, where McIntyre goes through the SEC filings that detail the large management feeds that Zelnick charges.
Ovide writes, “A sale remains under negotiation and still could fall apart, according to the people, who said a deal could be struck within days. The situation remains fluid, and it is possible another buyer will surge ahead of Bloomberg, the financial-information company founded by New York Mayor Michael Bloomberg.
“A spokesman for BusinessWeek referred a request for comment to McGraw-Hill. McGraw-Hill said it was ‘very pleased that the process continues to go well.’ A spokeswoman for Bloomberg declined to comment.
“At least one other bidder, private-equity firm ZelnickMedia, remains in the running, according to the people.
“Relatively little money is expected to change hands in any sale. The people said final-stage negotiations have focused less on the purchase price than on whether McGraw-Hill or the new owner would be responsible for paying severance to the BusinessWeek staffers expected to lose their jobs after a sale.”
Read more here.