Early next year should see the launch of TheStreet.com, the UK
version of the US financial news website. Against this background, there
have been persistent rumours that a couple of Financial Times
journalists are planning to break away and start a business news website
of their own - a possibility denied by the newspaper which, in the shape
of FT.com, already has its own well-established online site.
There is no doubt that this sector is highly competitive and becoming
ever more so. Most of the leading players in financial print and
broadcast media have extended their brands on to the internet for
several compelling reasons. First, the global nature of the net means it
offers them the chance to reach audiences who might not otherwise have
easy access to their products.
The second factor is more specific to what they are offering. Website
content can be updated throughout the day, giving investors prompt
access to business and financial information. This is clearly a very
attractive proposition for investors, as receiving news swiftly could be
the difference between them losing or making money.
It also appears an attractive option for media owners. The research
company, Forrester, has estimated that the market for web delivery of
business information will be worth dollars 11 billion by 2004.
In their efforts to cut themselves a piece of this action, however,
different media owners are offering different models. The Dow
Jones-owned Wall Street Journal Interactive Edition charges a
subscription while most of the content on FT.com is free.
’We don’t believe there’s any future for the subscription model for
content sites,’ FT.com’s marketing communications director, Paul
Waddington, says.
’More and more news content is being made available on the web and
there’s a finite market of people prepared to pay relatively small
amounts to access this. The two types of content people will pay for on
the web are very high quality market research and pornography.’
For these reasons, FT.com has been reducing the amount of content for
which it makes charges and has adopted a business model based on
advertising and sponsorship revenue. Due to its clearly defined and
affluent audience, it has been one of the big successes at attracting
advertisers among content sites. Advertising revenue for 1999 is on
course to reach pounds 6 million by the year-end.
However, the Wall Street Journal Interactive’s vice-president and
editor, Neil Budde, takes issue with Waddington’s assertion that there
is no future in the subscription model. ’Our view is that we’ve shown
people are willing to pay for it. If we deliver a site that has value
and depth of information, they’ll go for that. It’s up to us to make
sure we can get people to adopt a regular habit of usage,’ he says.
There is evidence to suggest that Wall Street Journal Interactive is on
the way to achieving that aim. Its most recent subscriber survey found
daily usage had increased from 40 per cent to 56 per cent.
Another finding from its research, and one of interest to advertisers,
was that among those users who researched products online, 88 per cent
made an online purchase. Clearly its subscribers are increasingly active
online buyers.
Intriguingly, Dow Jones has its own business information website,
dowjones.com, and is also involved with the website for the business
television network, CNBC. The former has more of a focus on providing
information that helps business people do their jobs, Budde says, while
the latter is designed in part to help promote the TV service.
’Just as on the newsstands there are plenty of publications covering
business, there is plenty of room on the web for sites covering
different aspects of business and finance,’ Budde adds.
It’s a good job because there is already a lot of competition out
there.
Magazines such as Fortune, Forbes and The Economist have all set up
content sites that draw heavily from the pages of their printed
publications.
Broadcasters have also entered the fray. Aside from CNBC, CNN and CBS
have both established websites, cnnfn.com and cbs.marketwatch.com, that
carry the latest financial news.
Finally, as one would expect, the traditional financial information
suppliers are also ensuring that they are not being left behind. Reuters
is investing heavily in the web as is Bloomberg, which last year also
launched a print magazine, Bloomberg Money. Bloomberg’s site is targeted
at the individual investor but is fed by information from the
professional services division of the company that specialises in dealer
and fund management information.
The site can be accessed by anyone but there is a subscription-only
element offering portfolio management tools. Advertisers include Mercury
Asset Management, Lexus, Barclays Stockbrokers, Bank of Ireland, France
Telecom and AMD Technology.
There was some concern among media owners that their activity on the web
might damage their print or broadcast products, but for the moment this
does not appear to be the case. Most claim that their web activity is
helping to attract a new audience.
The Economist’s executive editor, Anthony Gottlieb, says the magazine’s
website is stimulating 500 new print sales a month. So far, The
Economist has not gone for the regular online updating of financial
information that some of its rivals have done, but it is in talks with a
newswire provider and is planning to increase its investment in the
web.
’The internet will not abolish the need for weeklies because it does not
abolish the week,’ Gottlieb says. ’But we will offer more online-only
content and there is no reason why that should come out at the same time
as the printed paper.’
Looking across the board at the leading financial websites, one has to
say the quality is pretty good.
While they lack some of the whizzy gimmicks of consumer sites, layouts
are crisp, they are packed with useful information and navigation is
generally straightforward. This, one suspects, must be exactly what
time-pressed business users want.
Encouragingly, quality looks like it will improve further still as media
owners continue to invest heavily in new media. The following are four
on-line highlights of news sites for international business people.
FT.com
The strategy for FT.com is for it to be ’open so as to attract as many
people as possible’. This appears to be working: in August, it achieved
650,000 unique visits and 13 million page impressions.
As it is charging for little of the information contained on the site,
the majority of its revenue is generated by advertising. This is on
course to hit the pounds 6 million mark for 1999. Key advertisers
include IBM, Charles Schwab, Intel, Ericsson, Bank of New York, Nokia
and State Street Bank.
The site is targeted at world business users who need information and
business resources of a ’genuinely global, non US-centric’ nature.
According to the company: ’The typical FT.com user works as a senior
manager for a large international technology company. Aged 36, he’s
globally mobile, travels frequently on business between London, New York
and Santa Clara. Working as part of a globally dispersed team, he
communicates with colleagues in different time zones via e-mail, as well
as relying on the web to find everything from general business news and
stock prices to toys for his nieces and nephews and books and CDs for
himself.’
The Financial Times also has a personal finance website under
development.
The Wall Street Journal Interactive
Launched in April 1996, the Wall Street Journal Interactive Edition had
(at May 1999) 306,000 paid subscribers - making it, say its owners, the
largest commercial content site on the web. Its audience fits a younger
demographic than the print edition as nearly two-thirds of the online
version’s subscribers do not subscribe to the print version.
It is positioned as appealing to those who need or want business or
financial news from around the world at real-time speed. It also offers
fast access to relevant in-depth background information. About 90 per
cent of subscribers are based in the US, but the Interactive Edition is
stepping up its expansion in Europe.
The subscription price is dollars 59 per annum, reduced to dollars 29
for subscribers to The Wall Street Journal.
Revenue is split almost 50:50 between subscription fees and
advertising.
Dow Jones is predicting that the venture will become profitable next
year.
It has more than 60 dedicated reporters and editors, on top of which it
can draw on material generated by the print edition and from Dow Jones
newswire reporters.
Research among subscribers found 70 per cent noticed the banner
advertising on the site and that 17 per cent made a purchase after
seeing a banner ad.
Front pages are tailored to reflect local news. Access to the global
front page is at http://www.wsj.com in the US, http://www.wsje.com in
Europe, http://www.awsj.com in Asia, and http://www.interactivo.wsj.com
in Latin America.
CNNfn
An accompaniment to the US financial news TV channel of the same name
founded by the broadcaster four years ago, the website at cnnfn.com can
also be accessed easily through cnn.com, the main CNN news website. Most
of the website audience is US-based but it is increasing its
international reach.
It serves up more than a billion page impressions a year and attracts
two million unique users a month, as well as a slew of financial and
technology advertisers. Advertising accounts for the majority of the
site’s revenue.
There are 50 staff, two-thirds of whom are editorial. But the site can
also rely on news fed through from its sister TV network and elsewhere
in CNN.
’Everything we offer is free,’ CNNfn’s general manager and
editor-in-chief, Scott Woelfel, says. ’We haven’t ruled out doing
something that’s subscription-based in the future but as yet we haven’t
worked out anything that’s compelling enough to make charges for.’
Intriguingly, Woelfel points out that, when there is a bull stock
market, viewing figures for the CNNfn TV network rise. But in a bear
market, TV station ratings fall and website traffic rises. It is not yet
clear whether this is just a coincidence.
CNBC
The business TV brand, CNBC, has three websites serving different parts
of the world: cnbc.com for the US, cnbceurope.
com for Europe and cnbcasia.com for Asia. Advertisers include Saab,
Philips, DHL, Sun Microsystems, Motorola, Airbus Industries, Singapore
Tourism Board and United Airlines.
The websites are positioned as an online extension of the CNBC business
news and information network. They are promoted on air to inform viewers
of new features and to increase traffic numbers to the benefit of CNBC’s
advertisers and promotional partners.
A lot of web advertising is integrated with on-air advertising.
Research has found that 89 per cent of CNBC Europe’s viewers are
connected to the internet. According to CNBC Europe’s marketing
director, Jane Gash, ’a more interactive and personalised’ version of
the site is being developed for launch in the first quarter of next
year.
Key site features include live news and weather updates, programming
information and schedules, distribution and reception details, a listing
of hotels across Europe that receive CNBC (and a booking facility for
those hotels direct from the site), and a guide to the CNBC financial
information ticker.
Gash says: ’Through our dot-com and regional television networks, which
are leaders in business television news, CNBC has the ability to offer
both regional and global marketing solutions through sponsorship and
advertising.’
