After much speculation within the industry, financial news service Bloomberg announced this week that it is acquiring BusinessWeek magazine and its website from McGraw-Hill.
Terms weren't publicly disclosed, but the sale is reported to be close to $5 million, according to MediaBuyerPlanner. Bloomberg also will assume responsibility for liabilities and severance payouts.
The sale, which is expected to close this quarter, was precipitated by a significant drop in advertising; speculation was rampant that the magazine would be shut down this summer as have other titles such as Gourmet, Cookie, Modern Bride and Elegant Bride.
Though the deal's fundamentals have many analysts scratching their heads because BusinessWeek may continue to bleed cash, Bloomberg is likely looking at options for integrating the two respective content platforms and delivering more robust advertising opportunities for marketers – a path that Bloomberg Chairman Peter Grauer hinted at when he announced the deal.
Combining BusinessWeek.com and Bloomberg’s various websites will deliver more unique visitors than any non-portal business and financial site, he said, adding that the company is planning to build Bloomberg Television content around the BusinessWeek brand.
One drawback to this plan – assuming that it is a plan – is that no one has yet to truly master the concept of offering integrated advertising opportunities across websites, print and TV – not even Google.
Also, there is some dispute over how significant the combined web sites will be. Rafat Ali at PaidContent.org analyzed traffic on the two sites, and found that even a combined BusinessWeek/Bloomberg online will be nowhere near Yahoo Finance, the current giant in the space that averages about 25 million unique visitors a month, according to Nielsen and comScore stats.
Nielsen ranks BusinessWeek at #11, with about 3.5 million unique visitors each month, just below Bloomberg.com, which has about 3.6 million.
comScore also puts BusinessWeek at #11 with about 3.4 million uniques, while Bloomberg.com is lower on that list, at #13, with 2.3 million.
Bloomberg Chief Content Officer Norm Pearlstine said in a recent interview that all together it comes to about 7.8 million uniques with “very little overlap between the two."
However, he noted that Bloomberg has yet to decide how Bloomberg.com and BusinessWeek.com will work together online.
Though several possible paths to integration exist, the fact that this is Bloomberg’s first acquisition may make for a steeper learning curve in terms of the integration of the two organizations - although the company's products have been distributed in other print publications.