INTERNATIONAL BUSINESS MEDIA: BOUGHT THE TV STATION THEN THE MAGAZINE - As media conglomerates continually seek to broaden and strengthen their position within the global market for business media, Ashley Davies looks at how these groups hope to benefit f

The word on the street is that multimedia is the future for international business media. Media owners operating in this field are kicking each other’s tyres and investigating alliances, with the key objectives of widening and strengthening their footholds across more media and geographical markets.

The word on the street is that multimedia is the future for

international business media. Media owners operating in this field are

kicking each other’s tyres and investigating alliances, with the key

objectives of widening and strengthening their footholds across more

media and geographical markets.

It stems from the mantra that you should make the best of what you’ve

got or can get. Media owners are acting on the logic that resources

across television, radio, print and online services can be shared, and

their combined mass deepens their pockets for further investment. On the

advertising sales side, the media owners can then perform a

marketing-orientated function by selling across the whole portfolio,

offering multimedia solutions to clients in their mission to reach

business people.

In January, Dow Jones’s European Business News and Asia Business News

joined forces with NBC, creating the joint venture, CNBC. All three news

operations had been losing money and the deal was designed to fix that

by consolidating resources. Dow Jones’s overall portfolio also includes

products such as the Wall Street Journal, the Wall Street Journal radio

network, the Central European Economic Review, the Wall Street Journal’s

European quarterly magazine, Convergence, its weekly magazine, Barron’s

and the Wall Street Journal Interactive, which was the first newspaper

website to charge users for access.

Dow Jones makes a point of showing off the speed with which it can get

news on air, thanks to its various news centres. One example of this

shared news happened in May this year when Pakistan began conducting

secret nuclear tests. At 7.12pm in Hong Kong, the editor of Dow Jones’s

weekly, Far Eastern Economic Review, found out about the tests. He

immediately passed the story on to CNBC Asia, which interrupted its

Asian Wall Street Journal evening broadcast at 7.23pm to go live with

the exclusive report. Within minutes, CNBC was broadcasting the story


Bloomberg’s talks about taking over the European indicates that it wants

to own additional titles beyond its existing portfolio of TV, radio and

magazines. Having grown organically, the company’s different products

already share a significant level of resources. It runs ten TV channels

worldwide, a radio station in New York which is syndicated across the

US, and it supplies business reports to a handful of UK radio


In the next few months it aims to launch a radio news service for

European syndication.

Bloomberg also has its fingers in a number of print-based pies. The

company has two magazines in the US and Bloomberg Money, a joint venture

with City Financial Communications, in the UK. It is also about to

launch the same title in Italy. Michael Bloomberg, the founder and chief

executive of the operation, says: ’Business television will always

appeal to a niche market. Even as that market expands, its inherent

limitations make it difficult to make money out of a standalone channel.

The product needs the economies and cross-promotional opportunities

other media products can supply.’

Following its merger with Turner Broadcasting System in 1986, Time

Warner also has a sturdy stock of business media spanning CNN

International, CNN Airport Network, the Time and Fortune magazines plus

a mass of non-business media from Sports Illustrated to TNT and the

Cartoon Network.

And, like Bloomberg, Time Warner considered making a bid for the


So how do these media owners go about selling advertising across their

portfolios? And does the strength of their portfolios give them any

advantage over rivals for the advertising dollar? The systems vary but

two key views are shared by most: that volume discount is not the

desired outcome, and that presenting your company’s portfolio to clients

is a valuable marketing and relationship-building tool.

Martin Wright is the vice-president of the Turner Marketing Solutions

Group, which was set up three years ago as an asset-leveraging interface

between the company’s products and clients.

He says: ’The phrase ’cross-media deals’ is much used and abused, as it

implies bundling which leads to discounting. That’s a commodity market

which we have moved away from, a ground where others can fight. We’re in

the business of building long-term strategic marketing partnerships with

global advertisers.’

His boss, David Levy, the president of Turner Broadcasting’s

international advertising sales, backs up the argument that these sort

of marketing functions must take a long-term, strategic approach to

attracting advertisers.

’You must build up a relationship to show the opportunities which exist.

Maybe it won’t work with one client this year but that doesn’t mean they

won’t come back later. They may not have had the right resources

internally to exercise what you’re offering. If you can guide them

through all the opportunities, simplify it, that’s a huge asset for a


The company offers a mixture of advertising packages and ’insight-driven

marketing solutions’. Despite not wanting to look too keen on volume

discounts, it has just set up an incentive for its magazine advertisers:

those who buy four pages in Time International and Fortune International

get a free bonus page in Time’s Man of the Year issue and Fortune’s You

Inc issue.

With these three companies, advertisers can contact any sales point in

the portfolio to arrange cross-media deals. But does this give any added

value to the international media planners and buyers? Liz Workman, the

vice-president executive regional media director of Leo Burnett, says

that media owners’ ability to sell across their portfolios vary

according to how advanced they are in implementing this sort of sell.

’Sometimes it can be difficult because of the media owners’ profit

centres,’ she says. ’If you don’t have one single profit centre, it’s

difficult to get the deals done because everyone’s on a different

agenda. In practice it takes a lot of driving through.’

Pearson, for example, which owns the Financial Times and the Economist,

does not sell across its portfolio, although observers suspect it might

be investigating the notion. Pearson declined to comment on its

strategy, however, on the grounds of commercial sensitivity.

According to those who have set up marketing solutions groups to sell

across media, success depends on the commitment of those at the top of

the corporations. Levy says: ’The process involves introducing new

systems, thoughts, directions and changes. It really does stem from the

top down.

Ted Turner and the Time Warner chairman and chief executive, Gerald

Levin, certainly didn’t merge these two companies not to have this type

of synergy, and as long as they are pushing it down and their direction

is being pushed by their lieutenants, it can end up coming down very


Workman, like other planner buyers, says the advantages of cross-media

deals often lie beyond buying traditional advertising space. At Dow

Jones, for example, the heads of advertising sales across the different

products communicate regularly with each other in a bid to sell the best

of their resources to clients. Sheena Forster, the advertising director

of the Wall Street Journal Europe, says a big advantage is being able to

offer clients solutions which cross-refer their advertisements and

leverage the activity through tactical work.

’From a sales point of view, it makes it more exciting because it’s very

much a question of teamwork and we are helping each other all the way.

It means we have to be more creative and clients enjoy having that

opportunity,’ she says.

Many buyers are loath to get involved in cross-media deals simply for

the sake of it. David McMurtrie, the director of international media at

Mediacom, says: ’The proportion of money spent on these deals is


And there’s politics on the media owner side as well as on the client

side. At the end of the day there has to be some clear benefit to doing

these deals. They shouldn’t be done just because it’s possible. The

deals don’t greatly reduce the workload, and don’t let anyone tell you

that you do it for cost savings. It just doesn’t work like that.’

But while the owners of these glamorous portfolios boast of their

ability to reach business people across the world in the right

environment, there are threats coming from all directions. One senior

international planner buyer, who asked to remain anonymous, says he

often tries to avoid the business media when trying to reach business

audiences. ’I’d rather get them while they’re watching or reading about

sport and having a good time,’ he says.

And Workman adds that targeting these people can be difficult because

they are not enormous consumers of media and their consumption is

therefore based on need to know. ’For example, if the FT is their only

information source, they are not necessarily going to start looking at

offshoots. They are not particularly innovative or early adopters.’

But if business users are slow to change, that can be translated as


And if the brands are in tune enough with each other, there is a fair

chance that when they do experiment with different media, they might

just try yours first.

Ivor Kelly, the managing director of Dow Jones International, says: ’In

some ways we have a homogeneous audience around the world. Not every

business person has a one-stop medium. They access their information

from all media: some are more leisurely applications, others are a quick


Further threats come from online information, tailored to the readers’

interests. Hardly any of these services take advertising and are funded

by premium rate subscriptions. But, as we have been hearing throughout

the industry in recent years, the multimedia owners insist they are not

overly fearful of losing their readers or viewers to online sources

because the act of reading a daily newspaper, or watching international

news while staying in hotels on business trips, will always occur. Plus

they are putting their own investment into new media.

There is also an argument that the already small international

advertising cake is being nibbled by too many snackers, such as inflight

media and some of the smaller or newer news operations such as BBC World

and EuroNews.

The threat from the latter two is not considered serious right now, but

observers expect both to form further joint ventures within the next few

years. Then the scale of their combative abilities will be more


That’s not to suggest existing players are complacent. Further

consolidation is anticipated by all, not only to ensure a spread of

different media across the portfolios but to protect against regional


Levy says: ’In this competitive market, it’s harder to be a smaller

player. Costs are rising so, if you can offset your sales structures

with your marketing, you need to do more than just have one entity. You

can survive these troubled times if you have the overall infrastructure:

in some years the Asian economy can be hurt and Europe will do better

and vice-versa. A wide geographical spread can allow you to have the

swing years (when revenues fluctuate in different regions).’ He

anticipates we will see more marriages between distributors and

programmers across TV, cable and print.

McMurtrie reckons consolidation will be vital because the investment

required in exploiting digital TV and the internet will be massive. He

believes many of the specialist business-to-business publishers could

lead the way with internet applications, and eagerly anticipates the day

when even more targeted television systems are in place.

When asked where he sees digital opportunites leading, Wright bullishly

sums up: ’Global, regional, local, personal. Everything from ’our’ to

’me’ TV.’


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