Bennett, Coleman and Company Ltd's (BCCL) decision to get into a joint venture with US-based Dow Jones, publishers of the Wall Street Journal (WSJ), to launch an Indian edition of their flagship brand, may have come as a surprise to many. Speculation about BCCL looking at some kind of an association with WSJ, ostensibly to counter the Business Standard-Financial Times partnership, had been doing the rounds for quite some time though. But nothing was firmed up, or so it seemed.
On Monday, January 19, 2004, some sections of the media reported that talks with the US-based publishing group had reached the MoU stage with the formation of a new company, WSJ India, on the cards. In keeping with FDI norms in the print sector, the foreign entity would have a 26 per cent stake in the company with the balance controlled by BCCL, it was reported.
Arun Arora, president, Times Group and CEO, The Economic Times, did indicate, when contacted by agencyfaqs!, that talks with the US-based publishing group had been on for a while. "There has been progress on that front and we are taking it forward," is all Arora would say at this point in time.
At a broader level though, the ramifications of the proposed joint venture between BCCL and Dow Jones go beyond the realm of the Business Standard-Financial Times partnership, point out media observers. For one, Jaisurya Das, managing director and principal consultant of Pune-based Xanadu Consulting Group, says, "At one level, by launching WSJ in India, BCCL is attempting to counter Financial Times on its platform; but there are a couple of signals that the company is giving out at the same time."
One obvious message is that BCCL is open to the idea of FDI. "First, there was the MoU signed with BBC Magazines, then BCCL's radio business had foreign institutional investor CDPQ picking up a 10 per cent stake last year, and now the latest on WSJ. I think, the message is clear that BCCL is opening the floodgates for foreign direct investment to enter the company," says Das.
At another level, the BCCL-Dow Jones joint venture also points at the progression from the national level to the international for the former with the inclusion of a foreign brand in its portfolio. "BCCL has a presence in different media in the country and setting its sights at being a global conglomerate is a desire it is bound to harbour. Having WSJ under its umbrella is a great image booster, though I doubt whether it is a money-spinning proposition or not," adds Das.
Media reports indicate that content and editorial in the Indian edition will be controlled by Dow Jones, while printing and distribution will be handled by BCCL. In keeping with FDI norms, an Indian editor will be appointed to take charge of the edition and BCCL has also been tasked with selling advertising space, albeit, on a commission basis.
Again, from the point of view of The Economic Times, WSJ India serves the added purpose of protecting the daily's core audiences, especially, the corporate reader, that is, the CEO or the high-flying executive, who has the income as well as time to read at least two financial dailies, and is ever willing to switch to a third, more respected, international brand. "In India, Financial Times has higher recall value as compared to other international brands, and chances are that it could impact the readership of The Economic Times in the top-end segment," states Das.
Hence, with WSJ flanking The Economic Times, BCCL has ensured that its primary product remains intact with minimum disturbance in terms of readership. "BCCL is putting the classic flotilla concept to practice, where you have little products forming a protective ring around your main brand, while performing their own number at the same time," adds Das.
With two of the best names in international financial journalism making a beeline for India, segmentation of financial news readership is imminent. "You could have a situation where Financial Times, for instance, could be available at a hefty cover price and targeted at the premium end, while Business Standard is more mass oriented," speculates Das.
Whatever it is, 'times' are definitely interesting for the financial news market in print. © 2004 agencyfaqs!