Monthly Archives: August 2015

The sale of the Financial Times

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On 23 July it was announced that Pearson had sold the Financial Times to one of Japan’s biggest media groups Nikkei for £844m. Since this announcement Pearson has also sold its 50% stake in the Economist Group, publisher of the Economist, to existing shareholders for £469m in cash.

The famous pink paper has an editorial team of 580 journalists across more than 50 locations worldwide. The first issue was published in 1888 at only 4 pages, and was bought by Pearson in 1957.

The Financial Times had itself reported that it was in advanced negotiations with German media house Axel Springer, following a year of talks. In comparison, the deal with Nikkei was struck in only 5 weeks. Nikkei’s existing portfolio includes Japan’s biggest selling newspaper The Nikkei, which has 3.12m subscribers.

Pearson had owned the FT for 58 years but over recent years has been focussing on becoming the world’s largest education company, and had already sold many of its media assets such as The French media group Les Echos.

The £844m price tag represents around 43 times the operating income of the Financial Times. The sale includes the paper, FT.com and other titles such as The Banker and Investors Chronicle. It does not include the headquarters in Southwark, which the FT will remain in for another year.

The sale of the FT and the Economist comes at a time of significant upheaval in the media world, with traditional newspapers seeing print circulations steadily decline and increased investment in digital offerings. Paid circulation of the FT currently stands at 737,000, with less than 75,000 being in the UK. Digital users make up nearly 75% of subscribers, compared to 24% in 2010.

Under the ownership of Pearson the FT infamously did not consult with their owners about its editorial content, and as a result the content of the paper remained entirely editorially independent. Since the sale questions have been raised about the FT protecting its editorial independence, and in a statement from three former editors it was noted ‘there is nothing at present in the governance of the publication to guarantee the continued independence of the editor’.

Tsuneo Kita, chairman and CEO of Nikkei, said: ‘I am extremely proud of teaming up with the Financial Times, one of the most prestigious news organizations in the world. Our motto of providing high – quality reporting on economic and other news, while maintaining fairness and impartiality, is very close to that of the FT. We share the same journalistic values. Together, we will strive to contribute to the development of the global economy.’

Google’s Q2 results: what do they mean?

Google

Google recently announced $17.7 billion revenue in the first quarter of this year, $15.5 billion of which came from advertising revenue.

Ruth Porat, who took over the company’s CFO position, said: “Our strong Q2 results reflect continued growth across the breadth of our products, most notably core search, where mobile stood out, as well as YouTube and programmatic advertising…We are focused every day on developing big new opportunities across a wide range of businesses. We will do so with great care regarding resource allocation.”

Interestingly, Google’s decision to adjust its search algorithm in order to catalyse mobile development has apparently paid off, as rising user experience rates drove up the value and price of mobile ads. Google’s owned and operated apps also saw huge growth, Google Hangouts and Google Chrome each crossed 1 billion downloads in recent weeks, the company’s 11th and 12th products to reach that milestone.

Chief Business Officer Omid Kordestani said securing more high-end ad budgets for YouTube would be a priority moving forward as “brand dollars follow the migration from TV to digital.” Pre-roll

YouTube adverts have helped increase the number of advertisers on YouTube by 40%. The average spend on YouTube is up by an enormous 60%.

What do Google’s Q2 results mean for advertisers?

Continue to invest in mobile advertising as the channel continues to grow, particularly YouTube. Make the most out of your collateral by posting and promoting your videos across multiple channels as well as YouTube including Facebook and Instagram.

Look to other channels too. Bing has grown by nearly 20% in the UK over the past 12 months and one in 5 US-based desktop searches were made using Bing, according to comScore’s March data. Bing also offers great value for money, last year the average CPC was $0.15 cheaper than Google’s CPC in 7 out of 8 cases. Bing is also a good channel to use when targeting users in an older target market, Bing users are traditionally aged between 55-64 years old.