Pearson’s big paydays defy the odds against print media

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Despite these risks, the Financial Times’ successful auction was fueled by the combination of its brand and its success in its digital business, said Mr. Lee, of Evercore. Over the past decade, the number of Financial Times digital subscribers has grown from 76,000 to around 535,000; a majority of its around £ 300million revenue comes from subscribers, not advertisers.

John Ridding, managing director of the Financial Times, said in an interview that the newspaper’s gamble in charging a high price for premium content, both in print and online, had paid off. And neither he nor his colleagues wanted the Financial Times to become a billionaire’s toy – it had to continue to be relevant media property. “Some people thought it was a trophy purchase,” he said. “I think the answer to this question is firmly no. “

In the end, Nikkei wanted the Financial Times more than Axel, offering around £ 90million more, according to those briefed on the deal. “They would have been willing to go even higher,” Lionel Barber, editor of the Financial Times, said in an interview.

Nikkei’s intention to keep the Financial Times editorial and independent in London was an important consideration for Pearson executives. “In terms of editorial output, we will be distinct and distinctly pink,” said Barber, referring to the color of the newspaper’s newsprint. Editorial independence remains a bone of contention, and nearly 250 Financial Times journalists have signed a petition demanding that Nikkei formalize its commitment in this area.

There will be joint reporting initiatives – The Financial Times is planning a special section titled Japan and the World and will provide content for Nikkei’s television operations. There will also be joint conferences and small group exchanges of journalists. Other than that, Nikkei will, at least for now, allow the Financial Times to keep its profits and reinvest them in the company.

Still, there will be considerable pressure on the management of the Financial Times to make the deal financially profitable for Nikkei. This was one of the points raised by Mr Barber during a controversial staff meeting on October 29. After eight hours of “intimate contact,” Mr. Barber said, with Mr. Kita in Tokyo to discuss the newspaper’s business plan and several “still-secret”. “Editorial initiatives, he had a clear message:” New owners, new partners but the same FT. It is this “editorial independence, ladies and gentlemen,” he said, “that guarantees the incredible price Nikkei paid for the FT: 44 times the revenue. It is a very beautiful and generous price.

Mr. Barber said he was deeply involved in the sales process. “It could have been very bad, very bad,” he said during the staff meeting. “I mean I have nothing against the Qataris. It’s hot and it shouldn’t be a place where you play football, especially the World Cup. I don’t like Russian media owners. And I’m not too fond of commercial buyers in America who would have just gobbled up the FT. As for the Germans, I speak German fluently, I did it at university but frankly “- and there he turned to Mr. Ridding -” he is too polite to say that but they would have come and they would have torn our model apart. economic. “


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