BtoB

B-to-b publishers look to global opportunities

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As business media companies look for growth on a global scale, they must decide whether to build an overseas unit from the ground up, buy an existing business, enter into a joint venture, license their brands and content, or syndicate. At last week's ABM/FIPP World Conference 2008 in New York, panelists shared some of their experiences with those various options, offering lessons they have learned from international relationships and transactions. The conference was a joint effort of American Business Media and the International Federation of the Periodical Press (FIPP). Looking back at the international transactions she has done over more than a dozen years, Wilma Jordan, founder and CEO of Jordan, Edmiston Group, observed, “M&A has become more homogenous as more and more companies have become multinational and global.” Charles Engros, managing partner at Morgan, Lewis & Bockius, agreed that experience with multinational deals has helped buyers and sellers become more familiar with the nuances, but, he added, “There are still cultural differences, and a process of education needs to happen on both sides.” Having people located on the ground where the deal is being done is important both for cultural and practical reasons, said Jeffrey Stevenson, managing director and co-CEO of Veronis Suhler Stevenson. “It's difficult to have people come back and forth from New York for the months it takes,” he said. “That's why we have had an office in London for many years.” In emerging markets, revenue growth is often very high, said Scott Mozarsky, exec VP-chief strategy and development officer for United Business Media's PR Newswire. “The top line is a great story, but the bottom line is never exactly what you think it's going to be,” he said. For example, the way some employees are paid in Latin America, which understates their total compensation, can inflate profit projections. While buying an overseas company is one way for a U.S.-based business media company to branch out internationally, it is not the only one, said Michael Alic, Advanstar Communications' VP-Electronic Media Group and previously VP-general manager of the company's license group. Licensing, joint ventures and syndication deals are also options, “but finding the right partner is critical” to their success, he said. There are many steps to choosing an international partner, said Pramath Raj Sinha, founder and managing director of India's 9.9 Mediaworx. “We have a team that does all the analysis, and we find that checking references is a great help,” he said. “In the end, though, it boils down to trust.” “You have to go out into the territories and meet the people,” agreed Ian Bedwell, director of Mediastraat, a Dutch media consultancy. “One face-to-face meeting is worth at least 50 e-mails.” David Hill, president-CEO of IDG's International Publishing Services, told of a visit he made to the owner of a non-U.S. media company: “I was talking to him for about an hour and I had a feeling something wasn't right,” he recalled. “Then it hit me. We were sitting in a newsroom and the phone didn't ring once. Needless to say, we didn't do a deal with him.” Melvyn Goh is CEO-group publisher of M Media Group, a media investment arm of Morningside Asia that is building some prestigious U.S. media brands in China, including Forbes China, Harvard Business Review China and Information Week China. “At the end of the day, we leverage content across platforms,” he said. “Forbes is a premier conference brand. Harvard Business Review, available online and mobile, is the most expensive subscription in China. Each brand presents different opportunities.” Sinha, whose company is a licensee, said he always makes sure to meet with the editorial team at a prospective licensor. “If they can help me crack the code on what the market wants, not just provide me with content, they can save me years in the market,” he said. M
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