Blog Post

More On Exec/CEO Moves At Dow Jones

What does Rich Zannino’s promotion mean for Dow Jones? For one,openings in the CFO and COO department, both jobs he holds now. For one, an opening in the COO department. As COO, all operating units and most departments report to him. This could be a chance for a Dow Jones insider — particularly given Zannino’s non-media background — and, given the track record of the electronic publishing division, it’s not a far stretch to wonder if Gordon Crovitz could be up for the job: purely conjecture on my part for now; Zannino could opt for a different structure. He also may not want to rock the boat too hard in an area that is doing well overall.
For another, it gives Dow Jones a better fit with Wall Street; the stock is already up 10.5 percent for the day on this news and word that DJ exceed its 4th quarter earnings guidance. In that respect, the move was overdue.

How much of the company’s digital transformation can be attributed can be attributed to Peter Kann? His 15-year tenure as CEO — and nearly as long as chairman — included the launch of the Online Journal, the costly — and bold — acquisition of MarketWatch, and integration of digital publishing across nearly every facet of the company. I asked Crovitz for an assessment of Kann’s impact in this area. His reply: “Peter has always been a visionary supporter of electronic and online publishing, from sponsoring the launch in the mid-1990s of what was originally called The Wall Street Journal Interactive Edition and is now the largest subscription news site on the web, to the buildup of what is now almost 1,000 journalists at Dow Jones Newswires around the world publishing market-moving news in 10 languages, more recently to the creation of our Factiva joint venture in 1999 and the acquisition of MarketWatch last year. I know Rich shares Peter’s enthusiasm about our online successes and our future opportunities.”

One example of the continuing evolution of digital news for Dow Jones: today’s launch of the WSJ Law Page and blog on legal affairs. (sub. req.) as part of the exclusive marketing deal between Lexis Nexis and WSJ.com.
Update: I should have mentioned earlier the possibility that Crovitz could end up succeeding Karen Elliot House as publisher of the Journal, which makes a great deal of sense. Seth Sutel has more on that possibility.
Also, this from Merrill Lynch analyst Lauren Rich Fine: “As Zannino seems to have exerted a lot of influence since joining DJ in 2001 (e.g. Weekend Edition & Stockton), we do not believe there will be any big changes in strategy. The decision not to replace the retiring Karen House, the current publisher of the WSJ, likely signals more integration of DJ’s print and online operations in the future and a more prominent role for Gordon Crovitz, the head of Electronic Publishing.”
Update: From the Journal: “Despite persistent rumors in recent months that Dow Jones could be sold, Mr. Kann and Mr. Zannino both said the Bancroft family remains committed to keeping the company independent. And Mr. Zannino dismissed any notion that he was hired to streamline the company for a sale.” The search began a year ago; various outsiders were considered but the finalists were three insiders: Zannino, Crovitz and House. Now the role “formerly held by Ms. House may be subsumed into a larger job, according to Mr. Zannino. Rather than staying with a traditional stand-alone print publisher, Mr. Zannino said he is considering creating a broader position that would oversee further integration of The Wall Street Journal’s many operations, ranging from the newspaper to its Web sites to other distribution channels, such as radio.”

DJ Newswire: “Zannino said ‘right now we’re overly reliant on print ad revenue.’ He predicted the company would be less reliant on deriving revenue from both print-ad revenue and print circulation in two years.

NYT: “Dow Jones did not name a successor to Ms. House, 58, as publisher. L. Gordon Crovitz, senior vice president for electronic publishing, is expected to assume that role as well, according to a person who is aware of Mr. Zannino’s plans, indicating that the company intends to integrate its print and electronic news operations more closely. Mr. Crovitz had been considered a dark-horse candidate for the chief executive job.”

Related: WSJ.com, LexisNexis Form Exclusive Law Firm Distribution Pact

Watching MarketWatch’s Numbers

Earnings: WSJ Online Subs Up 8.8 Percent Over 2Q04; Electronic Publishing Outearns Print

DJ: Imagine What It Would Be Without Electronic Publishing?