RR Donnelley execs aren’t talking — neither are Steve Brill and Gordon Crovitz, at least about deal details — but paidContent has learned from multiple sources that the value of the Journalism Online-Press+ deal is in the range of $35-to-$45 million, including possible earnouts. When I spoke with News Corp.’s Jon Housman earlier today he would say only that the company’s minority stake had “appreciated considerably.”
In an interview late Thursday afternoon, co-presidents Brill and Crovitz confirmed that they were staying with the company they co-founded with Leo Hindery Jr. in April 2009 and that their team will move intact. They declined to say how many employees that included or how long the two of them would stay. “We’re here. We’re not going anywhere,” said Brill.
All Crovitz would say about the value of the deal: “We’re very happy with this transaction.” As a sign of the shift from startup to part of a public company, the pair, used to managing their own interviews, were joined on the call by RR Donnelley’s communications head Doug Fitzgerald.
As paidContent reported earlier today, Journalism Online was only on the block briefly before the RR Donnelley deal was brokered by the Jordan, Edmiston Group. The decision to look for a buyer came as the company was looking at further investment. None of the three would talk about the process or the sale specifics. Crovitz said the Chicago-based company’s publisher-centric approach made it the perfect fit. “Without getting into names of others, that’s not true of people selling tablets or selling search advertising or other services.”
FItzgerald said Press+, the name of JO’s paid content e-commerce system, will be the first offering of its kind for the Chicago-based company but “expands an area already working with publishing clients on.” Donnelly’s global footprint and existing relationships should help Press+ expand while the payment platform gives the larger company another offering for its clients and the potential to expand its own base. “It’s an opportunity to have our organization provide solutions that really span the breadth of the supply chain.”
Crovitz, the former publisher of the Wall Street Journal, said the sale also comes as the paid content question shifts from whether or not consumers will pay. No details (yes, that was a recurring theme of this session) but he said there are enough sites now running Press+ to see significant data patterns. “The religious debate is over,” he said. Some percentage of people will pay for content and with the right balance, sites can maintain traffic and retain readers.
The escalating data stream as they roll out to more sites should allow for more granularity. Brill said the question now turns to pricing and how results may vary from brand to brand.
When the New York Times Co. (NYSE: NYT) came up, they mentioned another pattern they’re starting to see. Unlike the Journal, the Times is not charging print subscribers extra for online access. That may be a mistake. Brill said their research shows people are just as like to add the online option when it’s heavily discounted as they are when it’s free. And, said Crovitz, when it’s free to print subscribers, fewer people seem to sign up for the online-only subscriptions.