Dow Jones Wants More Digital Media Properties

Consolidation. Consolidation. Consolidation. Continuing what just might be the trend of ’07, Dow Jones just might be snapping up more digital media properties in the near future, according to today’s Q1 2007 earnings report. The company had a nice quarter for online ad sales, too. U.S. online ad revenue was up 30 percent and international revenue rose 9.6 percent. Paid subscriptions for WSJ.com and Barron’s Online each rose, making for a 22 percent total increase in subs.

Here’s a little more from the investor call (thanks to SeekingAlpha’s transcript). As noted by CEO Richard Zannino, “We are most focused in looking at acquisitions in the digital arena, as well as the B2B arena.” In terms of digital media properties, he added, “I think it would be more likely that you would see us play in this area with companies like eFN, where they have a strong component of online, but the multiple is much more reasonable and realistic.” Dow Jones just bought UK financial media company eFinancial News Holdings for about $51.6 million, announced Friday.

Company execs also discussed online ad yield, which was up 16 percent in Q1 for display ads, apparently driven in part by behavioral targeting, “which takes advantage of the added scale that we have across the entire network, MarketWatch, plus the online Journal, plus Barron’s Online,” said Gordon Crovitz, EVP, president, Consumer Media Group, and publisher of The Wall Street Journal. (Read more about the company’s behavioral targeting.)

Though Dow Jones apparently has added new remnant programs, including search and text ads, the company seems to be pushing to sell more of that inventory to display advertisers, and bt is facilitating that. Continuing on remnant inventory, Zannino said, “When we talk about remnant space, we’re basically selling space that heretofore went unsold. So even though it’s sold at a relatively low yield, it’s generating revenue dollars for us and we’re selling inventory that we haven’t been selling in the past. So…when you look at apples-to-apples comparisons of our display inventory, yield is up nicely there and then we’re generating additional revenue dollars by selling some of this other inventory on a remnant basis.”

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