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Murdoch Gets Dow Jones, Now What?

Posted on Tuesday, Jul 31st 2007

As expected, Rupert Murdoch has successfully negotiated for himself a position in the Business and Finance vertical with a crown jewel brand, The Wall Street Journal.

Here’s my previous analysis on why this deal is a good one.

I really like News Corp’s verticalization strategy.

James Altucher asked Jim Cramer, “What’s the one thing the WSJ should do going forward?” They agreed that WSJ should not only have news, but also Opinions that can move stocks. Here’s my take on how that can be accomplished in a very Web 2.0 way.

Jim & James: The best way for the WSJ to introduce “dialogs” and “opinion” is by pulling together a blog network powered by a technology like Adify. There are hundreds of great business and finance writers out there with strong opinions, interesting insights. James, your Daily Blogwatch column links to many of them. These writers need to be woven into the Journal’s more News oriented coverage.

Now watch this.

Let’s say, the WSJ assembles 50 such cream-of-the-crop small publishers with good opinion and analysis content that can be nicely “networked” into the Journal’s anchor content. Over time, each of these publishers would be doing 4 Million Page Views a Month. The Journal’s Ad Sales force would be responsible for selling ads on these sites, and let’s say, they command a robust $150 CPM, given that it is a premium audience.

The revenue split could be as follows, to position effectively against Google’s AdSense, which pays publishers diddly nothing:

* Publisher gets 70%
* WSJ gets 20%
* Adify gets 10%

With that, each publisher would make $5 Million a year, and the Journal would make over $70 Million a year of insanely profitable revenue. If the network can expand to 100 such publishers, the revenue doubles, obviously. The beauty is, there already are hundreds of such publishers. It is the Networks that are not ready yet. Once the twain shall meet, magic awaits!

I would be devastated if Murdoch doesn’t comprehend the magnitude of this opportunity.

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i like your blog

shaikh aasim naeem Wednesday, August 1, 2007 at 3:41 AM PT

Next thing — Fox/Sky or Start network will do anything the growing power of Google — conventional information providers are not intimidated by old rivals — it is Google , which has completed demolished tried and tested business model.

market research report Wednesday, August 1, 2007 at 4:55 AM PT

Sramana – good analysis – i think Fox/Sky or Start network will do anything to stop the growing power of Google —
the logic is the conventional information providers are not intimidated by old rivals — it is Google , which has completly demolished tried and tested business model and forced Murdoch to buy MySpace, Dow Jones, Setup box company in the UK — they have no clue what to do next!

market research report Wednesday, August 1, 2007 at 5:09 AM PT

For all the crap that Jim Cramer gets, he’s probably revelling in his win here. He said the deal would go through, as his record shows here

John Singer Wednesday, August 1, 2007 at 10:07 AM PT

Thanks again for the mention Sramana – and you’re absolutely right. No other media property in the country, perhaps, is better positioned to leverage its name in order to build out a business and finance community and ad network under its brand. The WSJ is nearly synonymous with the word “business” around the world and its hard to imagine bloggers and small publishers – and advertisers – not falling over each other at the Journal’s doorstep to be associated with it. This is the new model for publishers and, you’re right, it would be a shame if News Corp. didn’t take advantage.

Joelle Kaufman Wednesday, August 1, 2007 at 11:36 PM PT

[…] answer is no. My quick back-of-the-envelope analysis of a possible vertical business blog network with ad revenue sharing in partnership with 50 strong […]

WSJ’s Subscription Business Can Go - Sramana Mitra on Strategy Wednesday, August 22, 2007 at 8:12 AM PT