Last week, we mentioned the consolidation taking place in Financial Media

It seems a deal was reached over the weekend:  Dow Jones snagged CBS Marketwatch for $18/share or $ 519 million dollars.

This effectively triples DJ’s reach. Dow Jones’ WSJ.com (paid subscription access only) averaged 2.8 million "unique visitors" every month. MarketWatch, which is a free site, had 7.6 million visitors.

The purchase will give Dow Jones a "dual" model:  a high end subscription site, including Barrons and WSJ, and a higher traffic, free site. One would expect  economies of scale and creative advertising packaging (different sites with different demographics)  to make this work on an ongoing basis.

I haven’t drilled down thru the numbers to see if they are overpaying, but it seems rich at first glance.

Next up: What do the suitors who failed to snag Marketwatch — NYT, Reuters, Yahoo!, etc. — do instead?  They look at whether The Street.com offers a viable alternative to Marketwatch help bulk up traffic.

Disclosure: I publish at TheStreet.com, but hold no equity interest or stock in TSCM.

Category: Media

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

2 Responses to “Marketwatch to Dow Jones”

  1. ANON says:

    GOOD FOR MKTW. THEY HELD AN AUCTION PROCESS AND GOT THE BEST BID. YOUR COMPARISON OR ASSUMPTION THAT TSCM IS AN ALTERNATIVE TO OTHERS WHO MISSED ON THE BIDDING ACTION IS OFF BASE. MKTW IS A NEWS REPORTING SERVICE, WITH A BIT OF COMMENTARY THROWN IN BY SOME QUALIFIED WALL STREET/JOURNALIST TYPES. ALL FOR FREE. MKTW HAS HAD A NICE RAMP IN REVENUES FROM ADVERTISING AND PAID SERVICES. TSCM HAS A DIFFERENT BUSINESS MODEL, CONCENTRATING ON BUY AND SELL SIDE ANALYSTS SHARING THEIR THOUGHTS ON A PAID BASIS. THAT IS WHY THEIR INCOME STATEMENT AND REVENUE GROWTH SUFFERS(REALMONEY). THESTREET.COM AS A REPORTING SERVICE LACKS SEVERELY IN CONTENT AND VERSATILITY. MKTW AND DJ TOGETHER MAKE SENSE, SINCE THEIR WOULD BE EDITORIAL OVERLAP SOLVED BY COST CUTTING AND A SENSE OF FUTURE PROFITABLITY. TSCM AND ANY OTHER SITE WOULD OFFER NO SUCH SYNERGY, AND WOULD REPRESENT JUST AN ACQUISITION. SINCE TSCM HAS YET TO TURN A PROFIT, AN ACQUISITION BY A SUITOR WOULD MAKE LITTLE SENSE, UNLESS TSCM CUTS ITS PAYMENT TO CONTRIBUTORS. IN THAT CASE, WHY WOULD A WALL STREET PRO EVEN WANT TO CONTRIBUTE, GIVEN THE DISCLOSURE RISKS IN THE BUSINESS. TSCM SHOULD REMAIN ON ITS OWN, A VIABLE SITE FOR THE PROFESSIONAL TRADER.

  2. David Bennett says:

    One “meme” which is “propogating” on the net and even mainstream media is the opposite of consolidation. People are waking up to the fact that various web based media are going after the same “eyeballs” and doing it better.

    I keep half track of this on seekingalpha.com

    Though so far his discussion is focused primarily on blogs (not really mentioning the potentials of other formats such as wiki and magazine like layouts) as potentially more efficient than the private research within funds, the arguments apply to the expensive private newsletter and to some degree to the more mainstream publications you mention.

    While the truism is that consolidation limits diversity, I’m less convinced that it is so. In a sort of media industry I think Barnes and Noble provided readers with a lot more choice than the mom and pop operations they hit. Good and specialized bookstores tended to survive and then as is happening with business information there was the net. Abe.com let the good used booksellers significantly expand their customer base. I find it has greater selection than Amazons used books, often at a better price.

    So now we have all these mom and pop business, investment and technology web pages and blogs. They are to some extent being joined into a larger publication by links and I think to the extent that they think of themselves as small enterprises (and a seriously run small business expects to go for a year or more without profits and here the potential wait time is greater since the motivations are different) then they are going to be figuring out ways to create symbiosis and also models of ways to generate cash.

    One thing I like about seeking alpha is that he is experimenting with Amazon and Google advertising, providing a first hand look at this source of revenue.

    While the big mainstrean guys do some major reporting, a lot more of this is possible on the net than people think. Somewhwere someplace are people from some company you want to learn about, or someone developing a technology. As the awareness factor builds some bloggers and other web publishers are going to get “tips” in the same way drudge does. And there are a lot of private investors that do some extensive research.

    Part of the problem is creating centralized edited places to gather it, but even now moderate amounts of sifting can get some good stuff. For example the discussions that yahoo links to it’s finance seervices is mostly garbage. But with a lot of stocks if you go through the hundreds of messages you can get lots of good pieces that save time, eg things like the average p/e or dividend in the industry, informed comments on a technology a company is pushing. I suspect that in *some* cases a few hours of drudge work would provide basic facts as good as that in many private research reports and in many cases you get good counter arguments.

    And this is in discussion groups that seem designed to attract the biggest idiots and discourage intelligent commentary.

    My own guess is that investment is going to be one of the first media areas really redefined by the possibilities of the new technology. This is because it has a relatively well educated audience, willing to invest a lot of time in finding out what’s important and used to paying money, sometimes significant amounts.

    Thus ideas like “Shareware” send some money to Barry to keep him in business, add things that can increase the value of his blog and advertise it by mentioning as I just mentioned seekingalpha will make sense.

    My observation that there is almost a taboo in people about doing these things, to really explore the consequence that through the United States government the people of the world have been handed the most powerful printing press in the history of the world where in theory every participant can reach hundreds of millions with the only cost being time, were collaborative efforts are simplified so that we have organizational capacities that once required huge bureaucracies etc.

    It’s as though these things have been developed unconsciously, people hesitating to examine the defacto power placed in their hands because they fear the responsibility, the reality that blaming the “other” is less valid.

    However it is possible that net publishers with an entrepenurial prejudice and readers with some sense of what’s required to build business may start figuring out ways to combine things to cut out the fat in existing organizations while creating a more perfect market system where all information (reasonably organized) is availble to all participants.

    Of course this is a huge threat to the investment powers that be.