New York Times Buys About.com for $410 Million

IAmTheDave writes "Reuters has the story that the New York Times Co. is set to purchase About.com for $410M from Primedia, Inc. The high purchase price is due to increased ad revenue, up 30% from last year." From the article: "Phillips pointed out that Internet companies have started trading again at significantly higher multiples, and said The Times Co. would be able to use ad revenue from About.com to make up for the flagging classified ad sales that have plagued the industry." Commentary also available at The Chicago Tribune, The Guardian, and CNN Money.

Comments

Oooooh ....

[Anonymous Coward]

NOw we'll need a free registration to read the junk on about.com??? No thanks!

Re:Oooooh ....

[elecngnr]

No doubt. I tried a link to that site one time doing a little research on something. It was 99% ads, 0.99% whitespace, and 0.01% information--and I use the term information liberally here. Some of the articles themselves are unabashed ads.

Re:Oooooh ....

[daeley]

bla bla bla bla bla bla

You misspelled ad.

About.com?!

[AyeRoxor!]

Wow. I bet they're partying like it's 1999! /fp

And strangely enough...

[Weaselmancer]

The story is posted on Reuters, and does not require a free registration to read it.

Re:And strangely enough...

[IAmTheDave]

It's on NYT too... but I just couldn't do that to everyone :)

News and Information

[BlueThunderArmy]

It sounds like NY Times is looking to make a website something similar to the BBC pages. There you can get a very basic history lesson, timelines and profiles, plus additional content like the Hitchhiker's Guide to the Galaxy.

Really, I would prefer to keep all of these things seperate, but it can be useful and there's certainly some appeal for the publisher to gain new audiences.

About Time

[mmerlin]

If it was a merger, they change their name to "About Time New York". It sounds better than AOL Time Warner

About.com changes

[EmagGeek]

Before Buyout:

Seals: An arctic mammal predominantly inhabiting lands covered in show and ice

After Buyout:

Seals: An endangered arctic mammal, frequenly accosted by the ever accelerating expansion of evil humans. Seals inhabit the endangered arctic ecosystems that are becoming more and more rare due to President Bush's oil cronies and their power and influence over corporate America. It should be noted that, while seals have been killed be the millions in the past, Republicans often like to go on Seal clubbing expeditions just to see small, defenseless, helpless animals suffer.

In Other News...

[WormholeFiend]

The Toronto Star buys Aboot.com

So how about slashdot?

[lottameez]

How much you think they can get for slashdot? $400 million? Or is a quarter, used movie stub, and some pocket lint closer to the mark?

Hopefully a good thing

[Momoru]

As long as it doesn't require free registration this could be good. About.com has alot of great content, on topics like cooking, pets, and cities (but not cooking pets in the city). But alot of it is outdated and flooded by popup ads. If NYT can improve the content then I say this is good news.

Digital vs. Paper

[boyfaceddog]

I know the NYT is into everything, but as a writer, it bothers me that one of the nations premiere papers are moving significantly away from their base operation. Printing news is not simply disseminating facts.

So the newspaper you prefer is....?

[Infonaut]

I'm dying to know what daily newspaper in the United States provides as much depth and breadth of coverage as the NYT without running afoul of your political orientation.

Re:So the newspaper you prefer is....?

[Momoru]

While some would say it has a left-wing bias too, I think the Washington Post provides much better coverage without the bias, and certainly without all the fake story scandals.

Re:So the newspaper you prefer is....?

[madro]

Old joke:

The people who run the world read The Wall Street Journal.

The people who think they run the world read The Washington Post.

The people who wish they ran the world read The New York Times.

(P.S. Both the Post and Journal have better reporting than the NYTimes now, which is sad. NY Times used to be the gold standard of journalism.)

at first i thought it was a coincidence

[museumpeace]

that i have used About.com more in the last year than all prior time added togehter. but then I realized that happens because about.com has increased the number of well placed google hits when I wanted to look up something. I think NYT better do their homework. I for one hate what an ad-fest about.com is and how random the value of their info is. Wikipedia, here I come. Were it not for their pushing themselves in my face via google, I would never have seen any of these ads that seem to have piqued NYT's interest.

Idiots

[pHatidic]

I want to go on record saying this is going to be a horrible move for the Times. Please mod this comment up so that five years from now if anyone sees this comment then I look like a genius for predicting the future.

Rearranging the deck chairs?

[Doc Ruby]

Competing with Wikipedia + the blogsphere, must the Grey Lady stoop to conquer? Or just find itself the first titanic newspaper to crash against a web iceberg?

All the news that's fit to purchase.

[Dylan Thomas]

Now, let me start with the disclaimer: there's nothing wrong with it. I'm a firm believer in good, old-fashioned capitalism and what any person or corporation wishes to risk his hard-earned capital on is entirely his decision. Al the best and I hope they make a bundle.

Having said that, is there still a line between news and marketing?

I remember, during the eighties, when a whole bunch of so-called "news magazine" programs, from Entertainment Tonight to First Edition and other similar shows came under fire because while pretending to be news programs, they were largely just marketing venues for the networks. However, the public adapted, and most people know how to distinguish between real news and slick-and-glossy "infotainment" (another word that came out of the eighties).

Nonetheless, going all the way back to Dateline NBC's exploding trucks (and I've spoken extensively to one of the producers about this issue, so let me also disclaim that no one who worked on that story still works for the show), I wonder if news and sales haven't become, well, the same process.

Sure, the bottom line is the bottom line. Newspapers exist to sell newspapers. That they report news is merely the product; the goal is to show a profit. If reporting news ceases to be a profitable product, newspapers will begin to... sell vacations on the Internet, perhaps?

My same favorite, Dateline NBC, ran a "two hour special" last year on Donald Trump. That special happened to coincide with his program The Apprentice. Were they reporting news, or hyping a television show? A producer told me, "Donald Trump is news. That he's affiliating himself with a television program is newsworthy. And interdepartamental hype is just part of the business."

So, what's the synergy? NYT runs a story on disaster recovery efforts in Asia. A sidebar on how some lovely small-town tourist attraction has already got back on its feet, and is open for visitors. Find out more at about.com, where several tourist agency links are ready to take your order. This, I suppose, is less tacky than the NYT simply running the agency ads alongside the article.

Where exactly is that line between news and marketing?

Re:All the news that's fit to purchase.

[Lord_Dweomer]

What people need to realize about print ads is that a media planners job is to make sure placement is relevant. So while there are OBVIOUSLY some clear cut cases of advertorials, you shouldn't get so upset about relevant ads placed next to stories unless it seems the story was blatantly written for the sole purpose of increasing the value of the ad.

Think of it like Google's sponsored links.

However, as someone in advertising/marketing, I'd also like to point out that many times we will try to work with a writer to get some free PR. This may be done by presenting them with an expert on the topic they are writing about, or suggesting an interesting article for them to write, which of course would have you mentioned in it.

I'm not saying there isn't scummy stuff out there, but it really is a fine grey line between what is relevant placement, and what is scummy.

Re:All the news that's fit to purchase.

[Combuchan]

A producer told me, "Donald Trump is news. ..."

I didn't hear anything about Donald Trump aside from a random bankruptcy and his distant plans about building here until The Apprentice came out. But since that program came out, he appears to be everywhere.

The distinction, of course, is whether Dateline is promoting a product (he is in this case a product) or reacting to a product that's already been promoted. But Dateline is a "news magazine show"--determining what exactly this is will be an exercise left to the reader because I sure as hell can't--and I don't think it falls in the same class of journalistic integrity one might expect, from the New York Times, the BBC, or The Economist. But then again, we make excuses for the media a lot--I'm sure your city has that blatant left/right wing daily, the never-awe-inspiring local news program, the weekly independent rag, etc. I'd like to have a source of news I don't have to make excuses for and remove filters to have an idea of what's really happening.

Altho this is digressing rather off topic, there's a reason they call it the boob-tube. The way television broadcasts news is almost like bottle feeding a baby. And if your exposure to a journal article or government report is from it flying on screen with one or two sentences zoomed and highlighted, or your idea of public perception is what the "man on the street" says, or you gauge a corporation's conduct by what their paid spokesdrone says, you're on that bottle. And most people who are don't even realise it. That needs to change more than anything.

I'd just like to say:

[temojen]

It's Americans who say about wrong. It's about, not Abaaawt.

This move makes sense...

[William_Lee]

Did they overpay? Yeah, probably in the short term, but let's look at the situation...

While the deal was certainly rich by price to cashflow and cash to revenue metrics, there are a limited number of these internet spaces for sale. CBSmarketwatch.com just went for over $500 million as a comparison.

The NY Times currently has a market cap of around $5.4 billion. They expect this deal to be accretive to earnings two years out. It doesn't represent an enormous purchase, just a pricey one by many measures.

The ad market for printed newspapers has been flat. Growth is expected to be anemic this year.

Newspaper circulations in general are down.

They picked up approximately 22 million unique eyeballs a month to target ads to via this deal, and a high traffic established internet site. The internet advertising market is growing.

Digitial media / advertising is a growth industry compared to the lackluster printed newspaper market that is unlikely to get better any time soon.

Traditional media outlets like the NYT need to continue to build internet presences to avoid obsolesence.

The deal while a bit expensive makes a whole lot of sense to stay competitive as media evolves and changes.

the future of media...

[L1nux_L0ser83]

i saw this on the net a while ago and i dont remember if this was on slashdot...but its scary .. its happening! http://www.broom.org/epic/ols-master.html

Re:How much did Primedia pay...

[William_Lee]

If you're going to try to correct someone, how about posting a link and doing it courteously instead of coming off like a smug prick.

According to cbsmarketwatch.com:

"The purchase price of About represents a multiple of more than 10 times its revenue, and more than 30 times its cash flow, in 2004. It's also slightly more than the $401 million that Primedia itself paid when it acquired the company back in March 2001. "

http://www.marketwatch.com/news/story.asp?guid=% 7B CD97F4BD%2DCDE3%2D458B%2DA601%2D3131D8929FE6%7D&si teid=yhoo&

The line.

[TapeCutter]

It is impossible to find "the line". To me it looks like a spectrum with Fox at the marketing/political-spruking end and the BBC at the news/information end. Here in Australia (sorry about Rupert Murdoch) we have 3 big free to air commercial stations and two stations in the BBC tradition. I only watch the commercial one's for movies and laughs.

Unfortunately we are like the US, the majority of Australians are not interested in anything beyond the sound-bites and cannot spot an advert unless it comes with bonus steak knives. To them propoganda is something the Nazi's did and does not come out of thier TV set. We get the BBC, FOX, CNN, etc on cable, during the early months of the Iraq war the same sanitised story came from every station except 3, the BBC and the two Australian (BBC type) stations ABC and SBS. When I was watching the 24x7 war news of the time, it was like the BBC was reporting on a different war. A few years have passed now and it turns out that the BBC were doing thier job while most of the others were simply handing out pentagon and whitehouse press releases. The message to Journalist's was clear "Don't question our motives, methods or facts". Michael Moore tried but was ultimately defeated by the "Fat Liberal" sound-bite. ( For the many slashdotters who despise MM, ask yourself, if his facts are inaccurate why is it that he is continually attacked via villification rather than contrary evidence? Note: I said "facts" and "evidence" not conjecture, conclusions, opinion or humour. )

Does BBC/ABC/SBS portray the "unbiased truth"? Maybe not, but they are alot closer to reality than any commercial station I have ever seen. They also seem to remeber what was news last week and have an ability to tie it into current events. Some of the others obviously don't want anyone to remeber what happened last week, thier strategy is to blast away contradictions by shouting louder or changing the subject to JJ's tits. As for what I have seen of the NYT, it is closer to the BBC end of the spectrum but does not understand how to profit from porting news (and it's reputation) to the web.