Tag Archives: Financial Times


Head of FT group to step down


Rona Fairhead, chief executive of Pearson’s Financial Times Group and a member of the board of directors of the London-based media conglomerate, will step down in April, reports Amy Chozick of the New York Times.

Chozick writes, “The departures of two executives who had championed the company’s print publishing assets, including The Financial Times newspaper, have fueled increased speculation that Pearson will seek to sell the rose-colored business daily, known as the FT, so that it can focus on its fast-growing education business.

“In October, Pearson reached an agreement with Bertelsmann, the German media company, to combine its Penguin publishing house with Random House. Under the agreement, which is still subject to approval from regulators, Bertelsmann would control 53 percent of the combined Penguin-Random House division.

“Among the companies that analysts have said could make a bid to acquire the FT are Thomson Reuters, which has an editorial staff of thousands, but no print publication. Bloomberg LP could also explore a purchase of the FT to help its journalism gain more exposure outside the financial terminal business. The company also owns Bloomberg BusinessWeek magazine. Spokesmen for Reuters and Bloomberg declined to comment when previously asked about a potential bid for the publication.

“A Pearson spokesman, Charles Goldsmith, said Ms. Fairhead’s decision to leave Pearson was ‘completely unrelated to ownership of the FT.’”

Read more here.


FT Deutschland to close next month


The FT Deutschland business newspaper in Germany is slated to close on Dec. 7, Reuters reports.

Reuters writes, “The paper, published in the salmon pink color of its British namesake, is pulling the plug after accumulating what German media said were 250 million euros ($322.1 million) in losses since 2000.

“The FTD, which has faced tough competition from a plethora of established national newspapers since its launch in 2000, has a circulation of about 100,000 but never made a profit.

“Some 330 employees will lose their jobs, sources familiar with the publisher’s decisions said.

“The FTD was seen as a breath of fresh air in Germany with a modern design, international perspective and audacious journalism style.

“It was alone, for instance, in criticizing a long-standing German practice of allowing interviewees to ‘authorize’ – or check – interview transcripts.

“Industry analysts have been predicting the FTD’s demise for years due to its lack of profitability. Losses in the last year were some 10 million euros, German media reports said.”

Read more here.


FT Deutschland could close


Harro Ten Wolde and Peter Maushagen of Reuters report that the Financial Times edition in Germany could be closed.

Ten Wolde and Maushagen write, “Publisher Gruner + Jahr (G+J), controlled by German media conglomerate Bertelsmann, is expected to decide the fate of the FTD at a board meeting on Wednesday but few at the paper doubt what the decision will be.

“‘There is not a single person in the newsroom who believes the newspaper will continue,’ a journalist who has been at the paper since its launch told Reuters.

“Another employee likened the mood to a ‘house of mourning.’

“A G+J spokesman declined to comment.

“The FTD, salmon-pink like its British namesake, has a daily circulation of about 102,000. It was founded as a joint venture with Pearson, but the publisher of the Financial Times sold its 50 percent stake to its German partner in 2008.

“The paper shook up the German print landscape in 2000 with its modern design, international perspective and free-wheeling journalism style.”

Read more here.

FT.com logo

The FT and mobile trends in media


The Financial Times and Muck Rack hosted Thursday a  discussion on mobile trends in media.

Rob Grimshaw, managing director of FT.com, answered questions moderated by Greg Galant, CEO of Sawhorse Media.

Here is an excerpt from the FT’s report on the session:

Creating a digital culture and driving innovation internally were hot topics of discussion and Grimshaw had this to say: “The hardest challenge isn’t tech, but getting companies to adapt to a new way of thinking”.

The audience was keen to understand more about how the FT is trying to reach a younger demographic, to which Grimshaw replied “ Financial Times mobile readers are frequently in their late 20’s/early 30’s”.

This drove the discussion on regionalisation and Grimshaw talked about how the US leads the way in terms of FT content consumption on mobile and how it takes six months for the rest of the world to catch up.

In terms of future plans, social login, Flipboard and an API on FT.com were all mentioned by Grimshaw, as well as the need to collaborate more closely across the business to compete for readers’ attention in a crowded marketplace.

Read more here.


Pearson CFO won’t rule out sale of Financial Times


Pearson Plc said Wednesday  it wouldn’t rule out a sale of the Financial Times as Chief Financial Officer Robin Freestone told investors that the company may eventually re-examine its ownership of the newspaper.

Amy Thomson and Kristen Schweizer of Bloomberg News report, “‘We look at the ownership of that and say, ‘Are we the best owners for it?’’ Freestone said at a conference in Barcelona organized by Morgan Stanley. ‘So far the answer is yes. That could change.’

“Pearson is emphasizing its education business as new Chief Executive Officer John Fallon prepares to take the reins from Marjorie Scardino, who retires in January. The company has decided to consider offers for the iconic pink financial newspaper this year, people with knowledge of the situation told Bloomberg News this month. Pearson had denied that the FT is for sale.

“Pearson may also ultimately re-evaluate its minority holding in a venture being set up with Bertelsmann SE to combine the German media company’s Random House with London-based Pearson’s Penguin publisher, Freestone said.”

Read more here.


FT accused of jacking up cover price


Louise Armitstead of The Telegraph in London writes that an analyst that follows Pearson Plc, the parent of The Financial Times, has written a scathing report accusing it of unnecessarily increasing the cover price of the paper and that the FT is not worth as much as what has been reported.

Armitstead writes, “The analyst said that Pearson was likely to sell FT Group to focus on its education business but claimed the newspaper is worth just £150m. With its 50pc stake in The Economist magazine, FT Group could fetch £600m to £700m, even with the so-called ‘trophy asset’, Mr Braley said.

“‘To get to a valuation of £1bn seems to rely on that kind of buyer who might also be in the market for football teams, art, pigs with mystical healing powers and trips into space,’ he said.

“‘That does not seem to us to form any reasonable part of an investment thesis.’

“He added: ‘The issue is simply that the FT isn’t a very profitable business, prospective strategic buyers are limited.’”

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FT says it will be primarily digital experience by next Olympics


The Financial Times expects to be primarily a digital mobile experience by the time of the next Olympics, according to FT.com’s leader, Rob Grimshaw.

Arif Durrani of MediaWeek writes, “Mobile already accounts for 25% of FT.com’s traffic and is said to be driving between 15%-20% of all new subscriptions, where iPad users lead the charge. Grimshaw suggests there is potential to grow this over the next year, when the brand will be celebrating an incredible 125 year milestone.

“He says: ‘I don’t think we have fully optimised the experience yet. It still involves putting in credit card details and addresses and such. Someone buying a sub on a mobile device is not a trivial thing, so we’ve been surprised to see so much coming through so quickly.

“‘But we also see it on the usage side of things as well, so if you look at subscribers as a core audience, 30% of their pages views now are coming on mobile devices which is huge. Even if you look at the [user] base as a whole [including non subscribers], it’s over 20% now.’

“The FT’s success in attracting paying digital subscribers made industry headlines this summer, after digital surpassed the 299,000 print subscribers for the first time. Two weeks ago, in the publisher’s latest update, digital subscribers had reached 313,000 in September, up 26% year on year, cementing the brand’s position as a digitally driven operation. It helped lift FT Group sales by 7% for the first nine months of 2012, despite the challenging ad market.”

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Analyzing the FT as an acquisition target


Reuters blogger Felix Salmon takes a look at the operations of The Financial Times in the wake of reports that it is for sale.

Salmon writes, “Pearson loves to repeat that ‘the FT is a valued and valuable part’ of the company, but there’s a good reason why public, listed companies tend not to own things like sports teams or works of art. For that matter, Pearson is one of very, very few public companies which own newspapers and which don’t have a dual-class share structure giving control of the company to some mogul or family. The buyers might not be doing DCF math, but the sellers do it all the time, and the value of $1 billion to Pearson is vastly greater than the present value of the FT’s future cashflows would ever be.

“The new owner, of course, will want to get $1 billion of value out of his investment, but he won’t be trying to get there by using the FT’s current playbook of constantly raising subscription rates. That, along with its paywall paranoia — the determination with which it attempts to prevent non-subscribers from reading all but the tiniest amount of FT content — means that it is actively repelling the population which is its best chance at future growth and relevance.

“The FT loves to tell advertisers that it reaches lots of very rich and important high-level executives, which is true. Newspapers sell readers to advertisers, and those executives are where the money is right now. But they’re not where the money will be, in say a decade’s time. When Rupert Murdoch bought the WSJ, I expected him to turn it into a formidable global brand, especially in China; instead, he invested millions in a new section devoted to New York City. It turns out that Murdoch’s desire to compete with and beat the NYT is greater than his desire to invest in an ultra-long-term project which would probably only pay off after he was dead.

“But there are two huge global news companies which are desperate to make inroads in China and other fast-growing countries: they have an enormous strategic interest in reaching the next generation of global technocrats, and they know they can’t do that with terminals alone. They need something which can travel more easily, something with a first-rate reputation: a foot in the door, if you will. To Bloomberg and Thomson Reuters, the value of the FT is not in its profitability, but rather in its reach and its reputation. It’s one of the very few possible ways of reaching the people who will be running the world in 10 or 20 or 30 years’ time — no matter what country they currently live in.”

Read more here.


Pearson denies it want to sell FT


Agence France-Presse reports that Pearson is denying a Bloomberg report that it plans to sell the Financial Times.

AFP reports, “Media wire Bloomberg reported that British media group Pearson was sounding out a private sale and that the company ‘has decided to consider offers for the newspaper this year.’

“Pearson released a statement within an hour, saying it was ‘not in the habit of responding to rumours, speculation or reports about our portfolio.’ It added: ‘However, this particular Bloomberg story is wrong.’ According to reports, Pearson is looking to offload the £1 billion (S$1.95 billion) valued company within months in order to focus on its fast-growing education division.

“Chief Executive Majorie Scardino has said the paper would only be sold ‘over my dead body’ but analysts have been predicting a sale since she announced her retirement on Oct 3.”

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Pearson seeks sale of Financial Times


Pearson Plc is planning to explore a sale of the Financial Times newspaper, as the company focuses on its faster-growing education business, people with knowledge of the situation said.

Matthew Campbell, Edmund Lee and Serena Saittoof Bloomberg News write, “The company has decided to consider offers for the newspaper this year, said the people, who declined to be identified because the process is private. Pearson may initiate sale preparations ahead of the departure of Marjorie Scardino, the chief executive officer, who is stepping down in January, said one person. Pearson has not hired an investment bank to advise on the sale, the people said.

“During her 16-year tenure, Scardino defended her company’s ownership of the Financial Times, Britain’s flagship financial daily, for which Pearson may seek as much as 1 billion pounds ($1.6 billion), a person familiar with the matter said. The paper is worth at least $1 billion, two other people said. FT Group accounts for about 8 percent of Pearson’s revenue and 12 percent of profit.

“Potential bidders may include wealthy individuals from Russia, the Middle East or Asia, as well as Bloomberg LP, one of the people said. Bloomberg LP, the parent of Bloomberg News, has made an offer for the newspaper before and been turned down, another person said.”

Read more here.