Blog Post

Dow Jones Reorg: New Consumer Media Group Must Swing From Red To Black

From a memo sent to staff today by Gordon Crovitz (newly minted EVP, president of Consumer Media and publisher, WSJ Franchise) laying out some stark challenges. The stark challenges faced by the new group are laid out. The decision to organize by markets means the profitable electronic publishing unit presided over by Crovitz no longer stands as a beacon of rising revenue. The new group would have lost money last year. The challenge: bring operating margins to double digits when all platforms are represented.
— “As the largest generator of revenue for the company, the Consumer Media Group must do much more to help drive Dow Jones shareholder value. In 2005, if this group had existed as a publicly reporting division of Dow Jones,we would have had revenues of just over $1 billion, but would have had an operating loss of $2.5 million. Given the power of our journalism and brands, none of us can be satisfied with these results. They will not continue. We will deliver profits.”

— “We build on a track record of improving results. Those of you in the Electronic Publishing division over the past several years doubled revenues, more than tripled operating income and boosted operating margins to the top of the peer group at more than 20%, from less than five percent. And the Internet team took a considerable loss in 2001 to operating income of more than $30 million last year, more than doubling revenues even before the MarketWatch acquisition, which nearly doubled online revenues again.”

— “… Finally, let us aim high, as is appropriate given the heritage of our inspiring brands. This is a time in the consumer media industry when we can make an enormous difference not just to Dow Jones, but to an industry craving leadership. Our traditional media peers are moving at best incrementally, giving us a rare opportunity to set ourselves as the clear leader. We must seize the opportunity to get ahead of customers’ changing needsâ