New Financial Times and Economist owners ponder the future of digital media
While everyone and their dog was talking about Bloomberg or Axel Springer being the likely new owners (see graph), nobody mentioned Nikkei, despite it being one of the largest media companies in the world. FT journalists even published an article the day before, outlining their publication’s “talks with Springer are further advanced” than with Nikkei (which, by contrast, was only mentioned once in the original FT article).
Now Pearson has sold another big name: the Economist has gone this week for around $731m (£469m), and Exor will end the week as the largest single shareholder in the Economist Group.
The new owners of both the FT and the Economist have stated their intention to continue pushing hard with new digital initiatives. The Economist, with its daily-digest Espresso app and the FT, with its successful paywall, are already innovative when it comes to their digital offerings, so what could the future bring? I predict that it will involve even more highly personalised digital offerings that give readers the news that they are most interested in up front, as well as increasingly targeted advertising.
Mergers and acquisitions (M&As) are usually centered around diversification – either geographically or to a different industry – and, of course, they always aim to generate increased profits. The selling company may well have a good reputation, but they’re frequently distressed assets with a falling market value – think Microsoft’s purchase of the ailing Nokia in 2013.
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