Why Breakingviews.com is worth the same as BusinessWeek

Matthew Wurtzel and Gerald Magpily of The Deal.com write Thursday about why two business news transactions — Reuters deal for Breakingviews.com and Bloomberg LP‘s deal for BusinessWeek — this week have essentially the same price.

Wurtzel and Magpily write, “These are two very different targets. BusinessWeek is a known quantity, recognizable to the masses who see it on newsstands and at doctors’ offices, but a troubled one that is having difficulty building a strong online presence. Additionally, it carries with it the baggage of high overhead affiliated with publishing a weekly print magazine.

“Meanwhile, BreakingViews is not widely known outside of the world of finance and economics, but it is highly regarded by its audience, who are willing to pay for the thoughtful commentary. It is primarily available online but syndicates its content to print partners such as the New York Times Co., who bear the overhead of printing. In other words, it has less overhead associated with its daily production. However, unlike the BusinessWeek model, the Breakingviews model relies more on the personalities of its writers such as Dixon and Robert Cox making them the assets of value. Should they leave, the value of the brand is diminished.

“So which is the future model for the media to follow? The explosion in the blog model with its low overhead certainly seems like a better value proposition for acquisitive media companies. The Breakingviews offer likely represents the beginning of a wave of deals of large traditional business media outlets acquiring niche sites that provide more than just news but analytical commentary.”

Read more here.