Pick up a Penguin

October 28, 2012

Pearson, which owns Penguin and the Financial Times, has been holding talks with Bertelsmann, the owner of Random House. But will Rupert Murdoch come to the party?

The new this week, [October 25th 2012] of talks between Penguin and Bertelsmann, could lead to a reshaping of book publishing, if it came about.

This one is a biggie

The industry sector is undergoing a revolution as e-publishing gathers pace. Mergers are likely. This one is a biggie. Splitting out the publishing figures shows that Penguin currently has annual sales of almost £1bn, and Random House £1.4bn. The merged company would become a top-six player in book publishing.

Enter stage right

But as the news broke, fresh stories from The Australian that Rupert Murdoch is interested in bidding for Penguin.

And that would make the tale even more interesting.

The merger between Pearson and Random House was rapidly confirmed. By Monday [October 29th 2012]

According to sharecast:

Under the terms of the agreement, Penguin and Random House will combine their businesses in a newly-created joint venture named Penguin Random House.

However, it will not be a merger of equals, with Random House’s parent firm, Bertelsmann, to own 53% of the joint venture and Pearson taking 47%.

Bertelsmann will nominate five directors to the board of the new company and Pearson will nominate four.

Marjorie Scardino, Chief Executive of Pearson, said the combination would “greatly enhance” Penguin’s fortunes and its opportunities.

To be continued


Pearson invests in an IT growth strategy

February 28, 2012

Marjorie Scardino

Pearson group led by Dame Marjorie Scardino has been investing in innovation to secure its future, and that of its flagship product The Financial Times

LWD has followed the successes of the grande dame of organizational leaders since one of our earliest posts [2007].

More recently we grumbled at the FT policy of restricting extractions from its e-content which we saw as part of the new emerging models for IT businesses, and not unlike Rupert Murdoch’s efforts to reinvent his own business model [2009], now threatened by the legal morass News International finds itself in. So it is somewhat more pleasing to report positively on this week’s news [28th Feb 2012] of Pearson’s efforts to reinvest its profits in innovation.

Dame Marjorie Scardino, the head of Pearson, has again scotched stories that the Financial Times could be sold as she earmarked another £1bn for acquisitions to drive the education group’s international expansion. Pearson, which also owns the books publisher Penguin and Edexcel, Britain’s main exams-testing body, spent £900m last year as it began to recycle proceeds from the sale of its stakes in the data provider IDC and the FTSE indices business. The money went on testing, technology and work-training firms in China, the US and Britain.END
According to the Thisismoney website

The publisher’s chief executive Dame Marjorie Scardino said the proportion of sales derived from digital output and services – such as teacher training – was more than 50 per cent. She fleshed out a rosy future in which the Pink’Un – as the Financial Times is affectionately known – would no longer be published in print format in some regions.

‘In places where our print run is very small, they’ll become digital places,’ she said, citing parts of Australia and west coast USA. Pearson reported rising sales in all divisions except North American education, where lower school funding has hit sales.

She added that she was ‘a bit sad’ that FT staff threatening strike action had refused to accept an offer including a 3.5 per cent pay rise and no compulsory redundancies. Pearson (down 47p to 1204p) has £1bn firepower for acquisitions. Directors have agreed not to take a 2 per cent pay rise this year, said Scardino, who earned a pay and bonus package worth £2.5million last year.

For a contemporary knowledge-based company, Pearson has a powerful statement of intent: Always Learning.

To go more deeply

See the thisismoney website post


Message from and to the Financial Times

January 16, 2012

The Financial Times now supplies information about its web articles with the request “Please don’t cut articles from FT.com and redistribute by email or post”. Point noted. The battle for pay to view continues

Rupert Murdoch was among the earliest figures to recognise the importance of developing new business models for successful management of news in the era of electronic information media.

The Financial Times, (FT) is also wrestling with these issues.

The FT is part of the Pearson group, the largest book publisher globally. Pearson, led by Dame Marjorie Scardino, has risen to the challenges of the electronic age. Its recent innovations include the search engine newsift

Creating value

On this issue I suggest that the FT may be misreading the way to create value from its information generating capacity. Increasingly the protectionist route is being eroded (music being the obvious example). News media are increasingly relying on social media inputs for the first signals of breaking news stories.

I remain a personal supporter (and reader) of the FT. However, as things stand at present, LWD will chose alternative sources from which to to extract information, and to critique and cite the source. What LWD does is of little importance to the FT. If a similar decision is reached by millions of web-savvy individuals around the world, it’s a different matter.