It's official: Bloomberg LP, the market data and news service, has bought BusinessWeek magazine from McGraw Hill and will rename the magazine Bloomberg BusinessWeek. The next question is, what is Bloomberg going to do with its not-so-shiny and hardly-new toy? After talking to a few people from Bloomberg who declined to be named, I picked up the following slivers of information:
-- Bloomberg considers the BusinessWeek brand a strong draw on business people and newsmakers, two audiences that would complement its stranglehold on the Wall Street/investor type. Not only would it enhance access to newsmakers and help the company break news, it would also give Bloomberg a fresh subscriber list with new potential clients to sell its terminal.
-- Bloomberg likes the journalism talent BW has to offer. The source noted significant shortages of enterprise-type editors at Bloomberg, and said BW would help to fill Bloomberg's need for mid-to-upper level editors.
-- In terms of worries about cost, rent and much overhead might take care of themselves simply because of economies of scale. One source claimed Bloomberg can cut rent 80% just by moving BW to Bloomberg offices.
Much of this speculation is echoed in a paidContent interview with Bloomberg Chief Content Officer Norm Pearlstine, whose respect for BW's editorial talent is palpable. His description of B&BW's complementary audiences also dovetails with my source:
"How it expands our reach is pretty obvious. BusinessWeek has a paid circ of 936,000, it reaches, according to the MRI numbers, 4.8 million readers around the world in its English language edition ... Bloomberg primarily accesses an audience of 300,000 extremely influential subscribers to the Bloomberg terminal but we have always had both a desire and a need to be read in the corporate suite, in areas of government where people are not subscribing to the terminal and that access is important to us in terms of our ability to break news, to provide better coverage for the subscribers of the terminal and BusinessWeek delivers on all of that."
Early rumors that Bloomberg would gut BW's entire staff now seem overblown, but we can probably expect between 20 and 50 percent of the staff to be on the chopping block as the companies merge. The NYT Decoder notes that McGraw Hill's initial memo proposed a 20 percent layoff of edit and back-office staff, and Bloomberg's overlap in the day-to-day news gathering business, plus human resources and other functions, almost certainly portends a higher percentage of layoffs. But no source I contact had a good idea of what the final figure would look like.
For more information, the best rundown I could find on the merger comes, appropriately, from BusinessWeek's On Media blog.