Reed batting out RBI


Reed Business Information, the US business mag division of English-Dutch Reed Elsevier, is on the block. It includes choice communications titles such as Variety, Broadcasting and Cable, Multichannel News and Publishers Weekly. RE’s CEO Sir Crispin Davis said the group is well-run, but that its ad-based income MO is inconsistent with the strategy used by the rest of the company.

"…today we have announced a further major step with the planned divestment of Reed Business Information (RBI)," said Davis. "RBI is a well-managed high quality business as evidenced by the success of its online growth and the control of costs. Its advertising revenue model and the inherent cyclicality fit less well however with the subscription-based information and workflow solutions focus of Reed Elsevier’s strategy."

RE made this announcement in conjunction with another detailing its plans to acquire data service US ChiocePoint for 4.1B. A tool used by insurance companies, it is considered to be a good fit with the firm’s LexisNexis service.

RBR/TVBR observation: obody is more aware of the situation in the trade mag business than we are. Of course Davis is going to praise RBI — he wants to sell it for as much as possible. But you don’t take a prospective buyer into the showroom and talk about what good mileage your magazine division gets; the client wants to hear how fast it goes from zero to sixty. Hey, these assets know how to control costs — could that be because they’re having trouble generating income?

We at RBR/TVBR have learned the hard way – you can not have it both ways, either you are subscription based or advertising based and internet driven. We will be watching the RE sales pitch on this group with extreme interest. RBR/TVBR personal note, we wish the best of luck in particular to our friends at B&C. One of our editors was working there back when Reed bought it in the first place, which is directly tied to why this editor is now working here. Not that very many of the people he knew back in the day are still there.

P.S. We called this sort of thing back in October, regarding paper, print and postage (10/29/07 RBR #211)