London: Pearson Plc., the owner of The Financial Times, said it was talking to several potential partners about new ways to display the newspaper’s journalism as it weighed the effects of Rupert Murdoch’s bid for Dow Jones & Co., owner of The Wall Street Journal.
“We’re talking to all sorts of people about different distribution channels,” Pearson Plc. chief executive Marjorie Scardino said in London. Potential partners include CNBC, the business news television channel owned by NBC Universal, she said.
Pearson and General Electric Co., the parent of NBC Universal, recently decided against making a joint approach to Dow Jones, after exploring the possibility of combining CNBC, Dow Jones and The Financial Times Group in a separate entity. Those talks, which Scardino characterized as “kicking the tires”, were prompted by News Corp.’s bid for Dow Jones.
Scardino, speaking as Pearson announced its financial results for the first half of the year, said combining The Financial Times, the leading international business daily, with The Wall Street Journal, the US’ top-selling business newspaper, would have offered “a lot of cost synergies”. But any combination would have been complicated by different strategies at the papers.
The Financial Times, with a circulation of about 450,000, aims to serve a “niche” market of global business leaders and politicians, she said. As part of its strategy, the paper recently raised its cover price—to $2 (Rs81) from $1.50 in the US, for example. She described The Wall Street Journal, with a circulation of more than two million, as pursuing a “high-volume consumer audience.”
Mint has an exclusive content relationship with The Wall Street Journal for India. The Financial Times is also an equity holder in Business Standard.
Scardino explained Pearson’s recent decision to enter into exclusive talks with LVMH Moët Hennessy Louis Vuitton, the luxury goods company, on a sale of Les Echos, a business newspaper in France, as a move to focus Pearson’s journalism strategy on global brands like The Financial Times. The circulation of The Financial Times rose 1% in the first half of the year from a year earlier, while subscribers to its website increased 12%, to 97,000, Pearson said. Advertising revenue rose 5%. After a difficult few years, the newspaper returned to profitability in 2005, and earnings from it rose in the first half to £10 million (Rs55.4 crore), from £5 million a year earlier. Overall, Pearson said its pretax profit rose to £40 million in the first half from £14 million a year earlier.
Some analysts have speculated Pearson might be worth more if it exited the cyclical newspaper business by selling The Financial Times and, potentially, drawing a trophy price for the paper. But Paul Richards, an analyst at Numis Securities in London, said Scardino’s comments on Monday suggested she might relish a battle with Murdoch.
“Certainly the way Marjorie was talking about the FT brand today, it doesn’t look like a breakup of the group is imminent,” Richards said.
Scardino declined to discuss plans for competition with a Journal owned by News Corp.