Thursday, August 12, 2010

To buy or not to buy

When Rupert Murdoch decided, 4 years ago, to buy for 5 billions dollars the Wall Street Journal, his sons and deputies thought that the old man had gone mad. Why spend so much money in old fashioned newspapers while Internet and electronic media are so promising ? In fact, according to his biographer, Murdoch wanted to fulfill his long time dream, to own a top American daily, either the Wall Street or the New York Times. Needless to say, the price was extravagant and the buying had a disastrous impact on the balance sheet of News Corp.

The same thing could happen this Summer with the sale of le Parisien. This daily has a good reputation and its sales with its branch Aujourd'hui en France, total 480 000 copies, a big figure by French standards. However, le Parisien has been losing money for 10 years and its web site is rather weak. I am sure some powerful people dream of owning the most influential daily on Paris region. The question is: is it a clever gamble to invest today in a publication on paper? It will be interesting to see who moves on this dossier. Do media moguls keep dreaming against their long term interests?