Wednesday, March 16, 2005
Puzzled Observers
McGraw-Hill looks to leverage J.D. Power name
When McGraw-Hill bought J.D. Power, "the move puzzled some observers," according to the article linked above. Or at least one observer, an analyst from a brokerage.
"The two main [McGraw-Hill] acquisitions last year were clear strategic fits [Capital IQ and Grow Network], while the J.D. Power acquisition is not as obvious a strategic fit, in our view," said a report written by Lauren Rich Fine, first VP at Merrill Lynch, and others at the investment firm.
I love "puzzled observers," especially analysts. Let's see: Business Week covers a lot of consumer products and technology businesses, and M-H publishes an array of b2b magazines and information services. J.D. Power is a major brand name in the research/ratings of consumer products and services.
How could a smart publishing company ever think to leverage that? I'm puzzled...what's the connection?
Uh, adding value to audiences, advertisers and shareholders?
Grab: [J.D. Power] made its name collecting ratings information in the automotive industry. Today, about 65% of its revenue still originates from the automotive sector.
J.D. Power has expanded, though, to serve the finance and insurance, health care, construction, telecommunications and energy industries. The Westlake Village, Calif.-based company said it will begin conducting customer satisfaction surveys of the after-sales service and support of technology products.
But Ms. Fine, of Merrill Lynch, notes: "We do not view this acquisition as a natural extension of [McGraw-Hill’s] existing assets in the information and media segment."
Perhaps this is why Merrill's symbol is a bull.
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When McGraw-Hill bought J.D. Power, "the move puzzled some observers," according to the article linked above. Or at least one observer, an analyst from a brokerage."The two main [McGraw-Hill] acquisitions last year were clear strategic fits [Capital IQ and Grow Network], while the J.D. Power acquisition is not as obvious a strategic fit, in our view," said a report written by Lauren Rich Fine, first VP at Merrill Lynch, and others at the investment firm.
I love "puzzled observers," especially analysts. Let's see: Business Week covers a lot of consumer products and technology businesses, and M-H publishes an array of b2b magazines and information services. J.D. Power is a major brand name in the research/ratings of consumer products and services.
How could a smart publishing company ever think to leverage that? I'm puzzled...what's the connection?
Uh, adding value to audiences, advertisers and shareholders?
Grab: [J.D. Power] made its name collecting ratings information in the automotive industry. Today, about 65% of its revenue still originates from the automotive sector.
J.D. Power has expanded, though, to serve the finance and insurance, health care, construction, telecommunications and energy industries. The Westlake Village, Calif.-based company said it will begin conducting customer satisfaction surveys of the after-sales service and support of technology products.
But Ms. Fine, of Merrill Lynch, notes: "We do not view this acquisition as a natural extension of [McGraw-Hill’s] existing assets in the information and media segment."
Perhaps this is why Merrill's symbol is a bull.
