Peter Kann, the former CEO of Dow Jones & Co., the parent of The Wall Street Journal and Barron’s, talked with Lee Hudson Teslik from the Council on Foreign Relations about how media properties still remain valuable businesses.
Here is an excerpt:
The counterpoint to the situation faced by U.S. newspapers is some of the success that has been seen abroad. The developing world has done relatively well. Is there more that can be done by U.S. papers to capitalize on that growth market?
Yes and no. There are parts of the world where print publishing is probably healthier at this point than in the United States, although it’s always a little difficult to compare the profit margin of a newspaper in China, where who knows what it really is, to the profit margin of the New York Times or the Wall Street Journal. For U.S. publishers there are really two ways to go abroad and conduct business abroad. One is to buy into national newspapers in other countries. There has been a modest degree of that, but it’s not a course that most U.S. publishers have taken. There’s a certain risk to that in many parts of the world, in part because there are regulations prohibiting foreign publishers from owning national publications. India is an example of that. In China you might be able to own a minority interest in a Chinese publication but you cannot assure that publication is going to produce honest news of the sort that you would expect it to produce in the United States or Europe.
Another way to go abroad is to take your brand and produce variants of your U.S. publication in other parts of the world. That’s what the Wall Street Journal has done with its overseas publications; it’s what the New York Times does in a sense with the International Herald Tribune. It’s what Time, Newsweek, BusinessWeek, and many of the magazines have done for years with the international editions. Those have certain benefits. You do produce an international news flow for your U.S. edition or U.S. publication, and that’s important, but it’s probably hard to think of any U.S. publisher, or any publisher anywhere, that is actually making any significant amount of money producing editions outside its own market. The one exception, I think, would be the Economist, because the Economist almost has no home market anymore. It has become a genuinely international publication. It doesn’t really fit the category that everyone else is in.
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