Dow Jones dilemma: plenty of demand, no ads
Jinfo Blog

11th February 2009

By Tim Buckley Owen

Item

‘Aggressive’ cost cutting has achieved claimed savings of over $100 million for Dow Jones in the year since its acquisition by News Corporation. Most of the reductions have been brought about by consolidating common services with News Corp, outsourcing certain functions and freezing salaries, the company says (http://digbig.com/4ygbt) – but there have also been ‘significant’ headcount reductions. In a memo to staff, leaked to the online journal paidContent.org (http://digbig.com/4ygbw), Wall Street Journal publisher Robert Thomson expressed succinctly the dilemma the newspaper side of the business faced: ‘an unprecedented increase in our readership, in print and online, but a precipitous decline in print advertising revenue’. However there are no lay-offs at present at DJ Newswires, and Dow Jones has in fact just launched enhanced web sites with expanded news teams for WSJ Europe, Asia and India (http://digbig.com/4ygbx), together with a new Mobile Reader to deliver content to Blackberries. Many media analysts believed that the $5 billion Rupert Murdoch’s News Corp paid for Dow Jones when it bought it in December 2007 (http://www.vivavip.com/go/e2621) was too high, and a rapidly deteriorating economy since then may have confirmed that. But as Thomson’s memo indicates, the demand for news is greater than ever, and the issue is how to continue satisfying that demand while containing costs. So what if anything should we read into the decision to send a citizen journalist to cover the Davos World Economic Summit (http://www.vivavip.com/go/e15916) for the social networking site MySpace – which is owned by News Corporation?

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