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Sunday, July 20, 2008

McGraw Hill to bid for Reed Elsevier?

This article, McGraw Hill plots bid for Reed Elsevier, in The Telegraph from London, England, is intriguing. For those unfamiliar with the competitive landscape in construction industry advertising and publishing, the story is could be compared to Coke preparing to bid to buy out Pepsi -- with Pepsi arranging the financing to make sure the deal goes through! (Or, since I'm not sure whether Coke or Pepsi are number one or number two in the marketplace, Pepsi offering to purchase Coke.)

Presumably the lawyers involved are aware of regional competition/anti-trust legislation for the world-wide publishing giants within the construction industry. Both businesses have a significant -- in fact -- leading presence within both the print and online markets; reading between the lines, Reed Elsevier wants 'out' of advertising-dependent businesses. Maybe Reed Elsevier sees the writing on the wall here and sense that relying on advertising revenue is not the way to go, possibly because of the power of online pay-per-click media like Google and other niche alternatives. I'm also intrigued because my understanding is that McGraw Hill has for several years decided to focus its new venture resources away from print media, recognizing the future is in online services. (In Canada, McGraw Hill has aligned itself with Merx, this country's leading online portal for online bidding/tender and business development opportunities.)

What will this news mean for you? If you are a consumer of either McGraw Hill or Reed's leads services or their publications, (that is you are an advertiser, rather than a free reader!), you conceivably will expect one of the the competing titles/services to merge/disappear within another. Alternatively, another bidder (unknown in this article) might appear and continue the competition.

We'll watch this story closely.

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