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Dow Jones family warms to sale idea

Associated Press The Spokesman-Review

NEW YORK — The family that controls Dow Jones & Co. says it is warming to the idea of selling the company to Rupert Murdoch or someone else, citing the “evolving competitive environment” in which the publisher of The Wall Street Journal operates.

To get an idea of just how fast that world is evolving, look no further than a blockbuster deal to combine two major financial news providers, Thomson Corp. and Reuters Group PLC, which first leaked out just two days after the Bancroft family’s initial dismissal of Murdoch’s bid in early May.

That deal, currently worth $17.8 billion, will create the world’s largest provider of real-time financial news and information, putting Dow Jones in an even tougher spot as it tries to expand its presence in electronic media.

Dow Jones has been diversifying beyond printed newspapers for years, building up its paid subscription Web site, consolidating its ownership of the news database Factiva and acquiring an online financial news site called MarketWatch.

But with a behemoth like Thomson-Reuters about to be created, its very profitable business-focused electronic media could come under even more pressure.

While the Journal remains Dow Jones’ best-known property, it’s also the least profitable. Dow Jones took in more than two-thirds of its profit last year — but just 23 percent of revenues — from products aimed at business customers such as Dow Jones Newswires, Factiva and licensing services.

The consumer media segment, meanwhile, consisting largely of the Journal, made up about 63 percent of Dow Jones’ revenues last year but was the least profitable of its three divisions, making up less than a quarter of total operating income.

Murdoch says he can change all that, giving the Journal more resources to expand its coverage in Washington and overseas, while also spending more to grow the Journal’s business online. He also sees opportunities to use Dow Jones’ pristine brand name and deep talent pool to launch a business-focused cable news network later this year.