Matthew Flamm of Crain’s New York Business writes about how Bloomberg‘s pursuit of BusinessWeek magazine signifies the company’s aggressive growth strategy of its media business.
Flamm writes, “The pursuit of BusinessWeek is part of what’s known as Plan B—a strategy announced by Bloomberg in July 2008 to grow company revenue to $10 billion by 2013, partly by adding a focus on consumer media. The privately held company had sales of about $6.1 billion last year, says Douglas Taylor of Burton-Taylor International Consulting. He expects revenue to be up slightly in 2009, driven by growth in emerging markets.
“In addition to Mr. Pearlstine, Bloomberg also brought in former NBC News chief Andy Lack last October. His task is to revamp Bloomberg TV—an also-ran in television business news—as well as its radio and Web operations.
“The company’s core business remains its terminals, ubiquitous in trading rooms around the world. Today Bloomberg has around 275,000 subscribers, down about 4% from last year, according to Mr. Taylor.
“Rented for $1,590 to $1,900 per month, the terminals provide cutting-edge software and analytics, as well as an endless bounty of news drawn from the Web and from the company’s 2,300-strong news and multimedia staff.
“Thanks to the terminals business, the company is pretty much the only major news organization in the country that is hiring rather than firing. Still, some insiders are leery of Bloomberg’s decision to devote more energy to its consumer media offerings. They fear that the shift could cannibalize some of the terminals business while adding little revenue. Their concerns extend to the potential acquisition of BusinessWeek. The 80-year-old title lost $43 million in 2008.”
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