MEDIA PORTOLIOS ARE NOT BAD

What´s wrong with media portolio diversification?

Gerald Magpily in Dealscape writes about The New York Times Company looking for more than news to print:


The Gray Lady is undergoing a slow well-known makeover by purchasing outside the newspaper business.

Over the last couple of years, the New York Times Co. has purchased a minority stake in a baseball team, bought a small televison station and invested in a cable channel.

Its biggest investment was the acquisition of a Web portal for $410 million.

Now, the New York media company, known for its venerable daily, acquired Monday a subscription-based film and television database and research service, Baseline StudioSystems, for $35 million in cash from Hollywood Media Corp.

The new purchase offers access to more than 1.5 million records of information on the entertainment industry. The Times says that it expects Santa Monica, Calif.-based Baseline to generate about $6 million in revenue in 2006.

Although not a big deal in terms of numbers, the move still follows the Times' strategy of diversifying its media holdings.

The Times has seen some moderate success, so far, with its purchase of About.com, which boosted its online advertising revenue 34.4% to $6.2 million in July (see chart of other purchases). So what's next for the Times?

Probably, much of the same — a continuation of buying assets outside of the newspaper business — to satisfy its shareholders who are looking for growth.—

Well, it looks fine to me.

All these new business can fit very well with a brand like The New York Times.

I will be alarmed if they were investing in mining or gas stations.

Newspaper companies are not in the printing business.

They are in the information business.

Newspapers that stay as mono-media companies are going to die.

Period.

And if not read the last issue of The Economist.