Tag Archives: Dow Jones & Co.
Dennis Berman and Jeffrey McCracken of The Wall Street Journal report Wednesday that a deal is near for the paper’s parent company to sell its stock index business.
Berman and McCracken write, “The price was expected to be greater than $600 million, said one of these people, though an exact price couldn’t be determined.
“Discussions have been going on for weeks and it was still possible a deal could fall through. The latest indications, however, were that a transaction could be announced in the coming days.
“A spokesman for Dow Jones, a unit of News Corp. and publisher of The Wall Street Journal, declined to comment. A CME spokesman also declined comment.
“A move by Chicago-based CME Group would push the exchange operator deeper into the investment information business, packaging and calculating lists of stocks and other investments for use in futures, options, mutual funds, and other investment products.”
Read more here.
Here are some comments made late Tuesday during the News Corp. earnings conference call:
CEO Rupert Murdoch: “We have American’s number one newspaper in The Wall Street Journal. Number one in terms of circulation, influence and quality, while other prominent papers are still suffering year-on-year advertising and circulation declines, the opposite is true at the journal. WSJ.com remains the digital model for newspapers around the world, with a strong subscription base and still growing advertising revenue.”
CFO Dave DeVoe: “Shifting to our newspaper information service segment, our operating income in this year’s quarter in $259 million and this is up 30% from what we reported a year ago. This improvement is largely driven by higher advertising at the Wall Street Journal and lower operating expenses throughout all of our newspaper businesses.”
Read the entire transcript here.
Michael Calderone of Politico reports that former Wall Street Journal managing editor Marcus Brauchli, now the executive editor at the Washington Post, received $6.4 million when he left the business newspaper after it was acquired by News Corp.
Calderone writes, “Previous reports have simply put the number in the ‘millions.’ But in Sarah Ellison‘s forthcoming book on the sale of Dow Jones, the ex-Journal media reporter writes that Brauchli walked away with $6.4 million.
“Brauchli, she writes, ‘was due $3 million regardless of how he left Dow Jones’ given his severance deal as a company executive. In addition, Brauchli’s attorney — D.C. power-broker Bob Barnett — negotiated an additional $3.4 million from News Corp.
“He’s not the only one that walked away with millions after the deal. Dow Jones chief executive Rich Zannino, who was only at the company about a year-and-a-half, and advocated for the sale to Murdoch, left with $20 million after the deal closed.
“Ellison’s book, ‘War at the Wall Street Journal,’ will not be published until May, but some of the details were revealed by David Carr on the NYT’s Media Decoder blog. I received a review copy from the publisher.”
Read more here.
Eduardo Kaplan, a managing editor at Dow Jones Newswires, has written a moving tribute to colleague Jim Murphy, who wrote the “Mark to Market” column and died Monday at the age of 66.
Kaplan wrote, “Throughout the years, Jim’s ‘Mark To Market’ column lucidly dissected every major subject in the news as well as many overlooked developments that in his view deserved attention.
“At a time of rapidly changing views about journalism, Jim’s commitment to the grind of a twice-daily column was exemplary.
“In another recent piece, he described one of the pitfalls of the profession: ‘once you set down an opinion or belief, it is almost impossible to continue writing about the same subject without intensifying the emotion one brought to the issue the first time it was written about.’
“Perhaps a better-hidden element of Jim’s last years at the helm of the column was that he managed to keep it going despite dealing with an illness that left him almost blind.
“With the help of his wife, Ruthie, of over 37 years, a constant presence in the columns and a woman Jim called his ‘ambassador to the world,’ Jim continued to pen ‘Mark To Market’ without fail. Late Sunday evening, only hours before he died, Jim sent an email to his editor, Robert Flint, saying he would be taking a sick day Monday but planned to be back Tuesday.”
Read more here.
Jeffrey McCracken of The Wall Street Journal reports that Dow Jones & Co. — which owns the Journal — could be selling its index business that operates the Dow Jones Industrial Average to CME Group for $700 million.
McCracken writes, “The two sides had hoped to announce a deal in the past week. The latest haggling has made a transaction less certain, said these people.
“That could present an opening for market-index firm MSCI Inc., which has also been in discussions for months with Dow Jones and its owner, News Corp. Dow Jones is the publisher of The Wall Street Journal.
“Dow Jones has for months been negotiating to sell the unit, which manages the flagship Dow Jones Industrial Average. A purchase would be a new step for the CME, which operates the Chicago Mercantile Exchange, and has a strong position in commodities, futures and options trading.
“MSCI has in recent weeks shifted its attention to acquiring RiskMetrics Group Inc. the risk-analysis and investment-research firm, said these people. MSCI’s interest in RiskMetrics then prompted MSCI to hire an investment bank to weigh other offers. Various media groups and private-equity funds are pondering bids for RiskMetrics, said people familiar with the discussions.”
Read more here.
TALKING BIZ NEWS EXCLUSIVE
Here is the e-mail sent to the staff by Dow Jones Newswires managing editor Neal Lipschutz:
“It is with great sadness that I inform you of the death of Jim Murphy, our esteemed ‘Mark to Market’ columnist. His pointed and often humorous writing style, his broad range of knowledge and his love of the English language are just some of the attributes that made Jim a much-read columnist and treasured colleague.
“Our sympathies go out to Jim’s family, which includes his son and Newswires columnist, Max Murphy, and to Jim’s many friends at Dow Jones.
“Jim had an impressively long and varied career in business journalism. He joined Dow Jones in 1995. Among Jim’s achievements, he earned in 2003 a William R. Clabby Award for his outstanding work.
“Here’s a short quote from the 2003 nominating letter that does some justice to Jim’s writing. ‘His everyman voice strikes a chord with thousands of people around the world who follow his columns on Dow Jones Newswires, as attested by the feedback he receives from readers in Australia, Canada and throughout the U.S.’”
Dow Jones & Co. president Todd Larsen – who took over the spot at the beginning of the year — sent this memo Monday to the company’s employees, further outlining who reports to whom in the corporate restructuring where four executives are leaving the publisher of The Wall Street Journal.
Larsen writes, “Dear colleagues,
“I would like to share with you today the structure of the new Dow Jones organization and some of the principal leaders.Â Like most complex global media companies, we need a matrixed structure to operate efficiently while focusing on core products and customers, key functions and primary geographies.
“The new organization will have five business groups â€“ each will operate with a clear profit and loss (P&L) approach:
- The Wall Street Journal in print
- The Wall Street Journal Digital Network
- Dow Jones Financial Markets (includes Newswires and products geared to financial professionals)
- Dow Jones Corporate Markets (includes Factiva and products geared to corporate markets)
- Dow Jones Indexes
“These seven groups will provide functional support for those product teams:
- Enterprise sales and Client Solutions
- Advertising sales
- Operations, including production and distribution
- Strategy and development (including Dow Jones Ventures)
“And finally, we will have regional leaders in Europe and Asia.Â These people will continue to manage our consumer businesses there while providing strategic direction for the overall growth of Dow Jones in each region.
“These are the leaders for each of those groups, all of whom report to me:
“Kelly Leach becomes general manager of the Journal where she will be responsible for the business of the Journal in print.Â She will manage the P&L, set a shared vision for the business and marshal the efforts of Journal colleagues to protect and extend this flagship brand and maximize its opportunities. Kelly previously was vice president for business management at the Journal.
“Gordon McLeod continues as the president of The Wall Street Journal Digital Network. He is responsible for the Journalâ€™s online business as well as MarketWatch and other digital products.
“Joe Lanza becomes president of the Financial Markets group where he will oversee the core Newswires business as well as drive growth in vital areas such as investment banking, sales and trading, wealth management and private markets. He previously was vice president and managing director for sales and trading.
“Scott Schulman becomes president for the Corporate Markets group. He will oversee the core Factiva business as well as drive growth in key areas such as research and knowledge workers, public relations and corporate communications, risk and compliance, energy and commodities, information services and business relationship intelligence. Scott previously was president of Dow Jones Financial Information Services.
“Mike Petronella continues as president of Dow Jones Indexes where he has provided so much of the energy and imagination behind the success of our stock-index licensing business.
“ Dennis Cahill is named senior vice president for technology and will lead the new combined technology organization. His task is to integrate the former EMG and CMG technology teams and to spur the creativity we will need to hold the attention of readers into the future. Ruby Walia, who has done a phenomenal job in his two years at Dow Jones, will report to Dennis and help him lead the combined team to success.
“Jennifer Jehn joins Dow Jones as senior vice president for marketing. She will be responsible for brand marketing, advertising, customer research and customer service.Â Jennifer previously was the senior vice president for marketing, online and human resources at the New York Post.
“Lee Wood becomes senior vice president for enterprise sales and client solutions.Â He will lead the sales teams serving all our enterprise customers for both the Financial Markets and the Corporate Markets groups as well as the Client Solutions business.
“Michael Rooney is chief revenue officer of The Wall Street Journal where he will continue to manage the advertising sales and marketing group.
“Lynne Brennen, senior vice president for circulation, is charged with maintaining growth in circulation at the Journal and other Dow Jones consumer publications.
“Joe Vincent, senior vice president for operations, leads the Journalâ€™s production and distribution effort, including the ongoing projects to increase color capacity and move the point of production closer to the customer.
“Ann Sarnoff is president of Dow Jones Ventures and also becomes senior vice president for strategy, adding to her portfolio by taking on strategy and business development responsibility in addition to her oversight of WSJ conferences and ventures.Â Simon Alterman, who has been a valuable strategic resource for EMG, will report to Ann and help her define our strategy.
“Andrew Langhoff remains publisher of The Wall Street Journal Europe and becomes managing director for EMEA for Dow Jones where he will add responsibility for the strategic growth of the company in that region.
“Christine Brendle remains publisher of The Wall Street Journal Asia and becomes managing director for Asia/Pacific for Dow Jones. She too will take on leadership for the strategic development of Dow Jones in her region. Bruce Macfarlane has decided to leave the company but will work closely with Christine on enterprise strategy and Lee Wood on sales to ease the transition through the coming months.
“Also leaving the company in this transition are three executives on whom we have relied significantly. Richard Hanks, Bill Voltmer and Alan Scott have made huge contributions to Dow Jones, and they depart with our admiration and thanks.
“As you can see, we maintain a clear focus on key customer groups.Â We remain committed to driving growth and improving our products for enterprise markets. And we continue to have a separate focus on developing our consumer businesses.Â Yet this integrated structure enables us to be more efficient and coordinated.Â Â With one technology organization, we can build things once and take advantage of that work in as many places as makes sense for customers.Â This will allow us to bring better products to the market sooner.
“I know some questions about the structure remain unanswered, but we will have everything resolved soon.Â Our objective in all this is to make sure Dow Jones remains a modern, agile company offering great products driven by great content.Â Our success will be defined by how well we harness the power of our products and the creativity inherent in our people.”
TALKING BIZ NEWS EXCLUSIVE
“As 2010 begins, I have decided to put in place a new organizational structure that aligns Dow Jones for the challenges and opportunities ahead.
“With immediate effect, we will cease operating as two groups and merge the enterprise and consumer divisions into a unified business. This will put us in the best position to pursue the single purpose of maintaining and strengthening our place as the world’s pre-eminent provider of news and business information.
“This reorganization will result in several changes:
“â€¢Todd Larsen becomes president of Dow Jones. He is now responsible for all commercial elements of the combined consumer and enterprise businesses.
“â€¢Stephen Daintith becomes chief operating officer of Dow Jones. In his new role, Stephen will work closely with Todd and me on our strategic development as well as the efficient structuring of a combined Dow Jones. Stephen will retain the job of chief financial officer with responsibility for finance, IT, and other administrative departments.
“â€¢Clare Hart has decided to leave the company. Clare has been a dedicated and much-valued executive in the two years since I joined Dow Jones. I have greatly valued Clare’s advice, support, and hard work, and wish her well in the future.
“Under the new structure Todd and Stephen will continue to report to me, as will Robert Thomson, Paul Gigot, Ed Finn, Mark Jackson, Greg Giangrande, and Ian Weston. The Local Media Group will also continue reporting to me.
“Reporting to Todd will be his current team plus Clare’s direct reports. In addition, Michael Rooney and the advertising team, Joe Vincent and the production and operations group, and Ann Sarnoff with her colleagues from Ventures will report to Todd. Neal Lipschutz of Newswires, until now reporting to Robert and Clare, will report solely to Robert.
“Todd, Stephen, Greg, and I will meet soon with colleagues across the company to provide more detail about our plans, but I want briefly today to explain why this change is right for us.
“To answer one obvious question, this change emphatically is not driven by a need or desire to reduce costs. It is happening because of a belief that by pooling our collective energy and creativity, Dow Jones will find new and better ways to develop the products that distinguish us in the market. A unified organization also will create more opportunity for our best and brightest people to flourish.
“To be successful, we need a structure and focus that makes us faster and better than our rivals in identifying and meeting our customers’ needs. We need a structure that supports our ambition to serve customers irrespective of platform or distribution channel.
“World-class content remains the bedrock of everything we do, and under Robert Thomsonâ€™s leadership we have already made great progress merging our news operations.
“Now we need the rest of the company to follow this lead.
“1. We have outstanding technological expertise across the company but need to combine our product development efforts. In a world of rapidly evolving technology, this is vital. To support the peerless quality of our journalism, we must provide state-of-the-art applications. This is essential to meet the demands of diverse enterprises eager for the right information to drive their solutions and their business.
“2. We must also work together in marketing what we do, providing a unified voice to customers. Whether our products are created and offered by the old ‘enterprise’ or ‘consumer’ groups, we must remember that the end user is often the same person and make sure our appeal contemplates all our possibilities.
“To make sure we create an organization best shaped for the future, we will take a few weeks to set the final structure under Todd. We ask for your patience, input, and focus during this transition.
“We have just completed a year when we found ways to improve our business despite one of the worst periods for media companies in decades. The Wall Street Journal became Americaâ€™s top-selling newspaper. At the same time, we have grown our print and online circulation revenue by double digits, grown online ad revenue, and, we believe, taken share across all our major advertising efforts. We have launched regional Newswires and Web sites in Europe and Asia and launched a Japanese-language Web site. In India, we are about to launch a major new mobile offering. For enterprise customers, we debuted numerous new products to tap specific markets within the business community.
“None of these achievements avoids the truth that we need discipline and diligence on the road ahead. But we are at the start of an era of ambitious global growth and now have the organization to channel all the energy and outstanding innovation of Dow Jones.”
TALKING BIZ NEWS EXCLUSIVE
The first decade of the 21st century began with business journalists facing criticism for their boosterish coverage of companies during the tech bubble and ended with many of the same reporters facing more criticism for failing to warn consumers about the current economic crisis.
In between, the world of business journalism underwent dramatic changes that make the field only vaguely similar to what it looked like back on Jan. 1, 2000.
Talking Biz News believes the following 10 events — ranked in order of importance — were the most important to business journalism during the past decade. If you’d like to nominate another event, please post a comment.
1. The demise of the daily business section: At the beginning of the decade, standalone business sections in metro newspapers across the country were the primary source of news for those seeking information about business, the markets and the economy. As 2009 closes, they’re now an afterthought. Many of these papers have only themselves to blame — the cutting of printed stock listings and the downsizing of business news staffs have cut the quality and quantity of business news they provide.
2. The biz magazine shakeout: Goodbye Business 2.0, one of the hippest business magazines ever printed. Hello, and goodbye, to Conde Nast Portfolio. So long, Fortune Small Business and BusinessWeek SmallBiz. In addition, Inc., Fast Company and BusinessWeek were sold to new owners, Fortune cut its printed issues by 33 percent and Forbes sold a minority stake of itself. None have been able to find a new formula for success.
3. The rise of Bloomberg News: At the beginning of the decade, Bloomberg was simply another wire service that competed against the AP, Reuters, Dow Jones Newswires and the now-defunct Bridge News. Now, it has the largest staff of business journalists anywhere. It owns BusinessWeek magazine, and it’s overhauling its TV operations to compete with CNBC and Fox Business Network. The contest for business news dominance now appears to be a two-horse race between Bloomberg and Dow Jones.
4. Dow Jones sale to News Corp.: Rupert Murdoch added the parent company of The Wall Street Journal, Barron’s, Marketwatch.com and Dow Jones Newswires in 2007 to his far-flung media operations. Along with the Fox Business Network, News Corp. now has a presence in delivering business news in every major platform. The Journal has continued to grow its subscription base and has led the pack in requesting consumers pay for business news online.
5. Cable biz news wars: After CNNfn went off the air in 2004, CNBC had the cable business news market to itself for the next three years, until 2007 when the Fox Business Network was launched. Amid criticism that it was too bullish at the beginning of the decade and too defensive of Wall Street at the end of the decade, CNBC continued to dominate business news on TV.
6. Lessons learned: Yes, business journalism was asleep at the wheel in failing to provide adequate coverage of tech, Internet and telecom companies in the first part of the decade. But many biz reporters learned their lesson, and the coverage in the latter part of the decade about the housing bubble and Wall Street problems was much better. And I don’t buy the argument that financial journalism should have warned consumers what was coming; we are not fortune tellers.
7. KHOU-TV’s coverage of bad tires: This was the 2000 coverage of the Firestone problems on Ford Explorers that led to dozens of deaths, and it was a stark reminder that the best business journalism is investigative and questions companies, searching for answers when a company stonewalls. It led to an overall more adversarial approach to business journalism for the rest of the decade.
8. Jon Stewart’s takedown of Jim Cramer: Forget the back and forth between the two combatants here. Simply put, “The Daily Show” hosts montage of bad calls by Cramer put into focus what every serious business journalist knows: You don’t ever predict something, particularly involving investments or money, in print or on the air. Sadly, Cramer’s not the only one who does this.
9. Pulitzer winners abound: From the 2002 win by Gretchen Morgenson of the New York Times for her coverage of Wall Street to the 2008 win by Washington Post business columnist Steve Pearlstein and the 2009 win by Alexandra Berzon of the Las Vegas Sun, the Pulitzer committee recognized that business journalism was prescient and performed its watchdog role.
10. New delivery systems: iPhones and Blackberries now act as a transmitter of The Wall Street Journal and other major business media outlets. Twitter sends headlines of breaking news. Kindles and Sony Readers can do all and more. The newspaper is not dead as a medium of business news, but it now has more competition from a variety of options.
GQ magazine has compiled an incredible oral history of the acquisition of The Wall Street Journal by Rupert Murdoch and News Corp. and what the reporters, editors and others involved were thinking at the time.
Here is an excerpt:
Former editor, WSJ
I’ll never forget it. On May 1st of 2007, I was standing in the Page One newsroom, and we were looking at the wires on their computer. We saw the bid and we all started screaming and laughing, because it was so high. Then somebody said, “You know what this means?” And there was absolute silence in the room. We were at the Journalâ€”we knew what happened when companies were taken over.
Former editor, WSJ
The notion that Murdoch would come through here one day was a constant refrain. I think sometimes it was said in jest and sometimes it was said in less jest. Particularly in periods when the stock price was in the toilet you’d hear it. So the announcement of the offer wasn’t an enormous shock. You’ve seen Fletch, right? Chevy Chase is a reporter and he’s trying to get information and he takes on all these disguises and identities. He’s with a doctor and he says about one of the doctor’s patients whose name he’s just spotted on the chart, “How is Harry?” And the doctor says, “Well, he’s dead.” And Fletch says, “Oh, I know. It was such a surprise.” And the doctor says, “Well, he was terminally ill for six years.” And Fletch says, “Well, yeah, but the end, the very end, that was a surprise.” It was a little bit like that.
Former senior special writer, WSJ
As time went on it was clear that Dow Jones was not successful in broadening its business beyond the Journal, that every acquisition it had made did not work out well. There was increasing speculation that somebody would come in and take it over, and that, God forbid, Murdoch was the most logical candidate.
Former reporter, WSJ
The stock was dead money for over 20 years. If you went back to 1983 and ran it through to before the Murdoch deal was announced, you didn’t make money. So the company was struggling, and there was always that gallows humor: What would be the worst-case scenario? And it’d be either Gannett or Rupert Murdoch.
Read it all here.