Oct
24
Processing PR into a New Age
Filed Under B2B, Big Data, Blog, data analytics, Industry Analysis, internet, news media, online advertising, Search, social media, Uncategorized, Workflow | Leave a Comment
There is, to the really ardent enthusiast, a sort of poetry about a sequence of acquisition deals in a sector which results in the emergence of a company large enough and technically adroit enough to challenge not just the pre-existing market leaders but the way in which business is done by practitioners in the sector. The announcement this week of the purchase of Gorkana (formerly Durrants) by Cision, now enhanced by Vocus, gives me a frisson of this feeling. From the dawn of the great age of newspapers in the 1880s, getting things into them and measuring the results became a business in its own right, nowadays abbreviated to “PR”. There is, of course, a lot more to it than that, and the things placed could range from advertising to editorial briefing, and more media opportunities widened the scope, but in 1880 PR was hunch and artistry. When William Durrant and Henry Romeike formed their press clippings agency in that year and named it after the former (Romeike seceded to form his own) the measurement was needed to demonstrate, and no doubt sometimes defend, the campaign strategy. Today, as we know well from other sectors, the ability to measure, and then analyse, can easily become more important than the inspired hunch. While the latter lives on in the industry legend, planning an effective launch campaign is increasingly a desktop activity in the marketing department which once employed those wizard PR consultants. Automating workflow, introducing unprecedented levels of accuracy and comparability, adding software tools from predictive data analysis through to automated campaign booking tools, and we have a revolution in process. And it came not from the PR industry itself, but from its ancillary, mechanical component, the clippings agency. If we look at many other industries entering the digital age, this is very often the case.
But between 1880 and 2000, very little happened. In that year August Capital acquired Discovery Group, which contained Durrants,for £14m in an MBI and installed a strong team of ex-Thomson executives led by Steve White. I can recall my own initial visit, in what is now London’s white hot high tech Shoreditch, and seeing the long desks of clippers with their shears and piles of newspapers. Did they seek consultancy, I wondered, or the Last Rites? And then very quickly came the idea that if all of that clipping could be automated and made searchable very great things could be accomplished. I know less of the history of Cision (once Sweden’s Observer Group, who sold Romeike’s agency, ironically, back to Durrants in the post MBI period), but I suspect that they followed a similar trajectory. Under the CEO, Peter Granat, who has brought first Cision and then, earlier this year, Vocus, together in deals funded by the Chicago private equity player, GTCR, they have created a powerful technology base in the US in parallel to the UK development at Durrants. August Capital sold on to the British PE player Exponent, which enabled an acquisition programme which included buying aligned software players Metrica and Gorkana, and the renaming of the company after the latter. Exponent’s exit at £253m (according to MergerMarket – others say rather less) demonstrates the value added through these activities and looks to me like a X12 multiple at least.
So here is a very satisfying story for those of us who still believe in Progress. Three private equity houses have brought in appropriate technology and management, and at each stage have made acquisitions that added value. Bringing all three together in Chicago could well be transformative for the new group, and for the global industry within which they are embedded. Over time usage will move out of PR agencies and into end user corporate marketing, a vastly larger marketplace. As this begins to happen, so will GTCR be able to leverage its position and get the right exit price. I do not imagine that the major advertising and PR agencies will allow this process automation without an attempt to own it. WPP, through its Kantar data unit, already bought Precise Information as a way of testing the waters. WPP’s major competitors have aligned interests. How often have we seen this in the networked world? You own a very profitable media franchise. This becomes threatened by digital transformation. So you are forced to buy one of the disrupters. Then the legacy business declines. Then you can enjoy life again as the proprietor of a much smaller and slightly less printable business.
The story of Gorkana, however, is a good one. And the final credit should rest where it so seldom does, with the management. Steve White and his initial 2000 team and their successors were able to see where users wanted to be, as well as grasping the impact of transformative technology. While they had to contend with both the active and passive resistance of some of the players in the process (for instance, newspaper management were deeply suspicious of any attempt to database their content, for whatever purpose), they completely changed the mechanics and analytical output of an activity which had hardly changed during the previous 120 years. Reflect that while this work was going on the dimensions of media monitoring were widening all the time, and including web presence and then social media analysis. And reflect as well that the management of these companies started without a content-based intellectual property valuation – they owned none of the content that they analysed. In the information industry in particular it is important that we remember what people accomplish, as well as software.
Jul
17
Hectic Diversions
Filed Under B2B, Big Data, Blog, data analytics, Industry Analysis, internet, mobile content, news media, Publishing, Reed Elsevier, Search, semantic web, STM, Thomson, Uncategorized | Leave a Comment
These are meant to be the dog days of summer. Lazy interludes when half the media-eating world was so distracted by sun, sand and sea that a prime minister could assassinate a few long-serving colleagues or a presidential hopeful could explore prospects in autumn primaries without the full flood of critical commentary that you might expect in the hard light of western winter. But this is the Digital Age. It is remorseless and quite without shadow or shade. And having spent this week in bed throwing off a minor illness I am now as full of news and commentary as I am of medicine. The effect is overwhelming. Because I now know everything I realise I know nothing at all. I can’t wait to get back to normal-half-informed but deeply opinionated!
But from the ashes of the week I draw out three stories that seem to me at least to express some of what we are about at present. Rupert Murdoch’s attempt on Time Warner must clearly be one. The Elsevier deal with DCL to add value to the Scopus archive was another. And the court case in which Reed as Lexis and Thomson Reuters as Westlaw claimed that their appropriation of legal briefs filed by US litigators constituted “fair use” was the third. And what is the picture drawn here? It shows, in my view, a still content-dominated world where major players still think that the more you have the more powerful you are, where grabbing and re-using third party data can help to bolster failing content positions (even if you have to use the tools of the enemy to do so!), and where upgrading value becomes a necessity in a world where metadata is the currency of users who cannot afford the time to view content. Just like me with all this News.
So what do I think is really going on? Investors and Big Players are now deeply confused. The old maxim – “if in doubt make it bigger” – still seems to make sense, but can you trust Mr M, who seems to have dumped his slow growth media assets into Bad Bank (aka News) and is now readying another wonderful adventure in consolidation in which banks, analysts and advisors will earn prodigiously as well. But the game is not about Archive alone, surely? It’s about distribution and it’s about innovation and it’s about funding, and, step forward Netflix, most of the evidence seems to show that smaller, aggressively competitive players do these things better than media giants. Perhaps the best argument for Twentieth Century Time Warner may be that you will have to be that big to buy Netflix in an OK Corral shoot out with Google.
So then transfer the “commoditization of archive” argument over to Elsevier’s Scopus. In my view, developing Scopus was one of the bravest publishing decisions in STM in the last half century. It is a benchmark for quality and consistency, but as the abstracting pushed back prior to the 1996 start date, so citations were not broken up and separately tagged as they would be today. Redressing the past with a current standard approach using a DCL automated solution seems to be what the current deal accomplishes, and pretty vital it is too if today’s researchers are not to miss something through assuming that tags would be in place to show them. In the age when Scopus was built we had begun to assume that not all researchers would need the full text of articles all the time: we are beginning to see now that researchers do not always have time to check the abstract. This means that the metadata must be as high quality and consistent as possible. One day archive will not be for full text or abstract reading purposes but for audit and authentication purposes. Has anyone in Mr Murdoch’s team run an analysis of the valuations available on a video archive where the revenue model is “by the drink” but you have to keep updating the metadata to maintain the access expectations of users? Especially those who normally use illegal streamed content anyway!
I once had a client, havering about the costs and implications of going XML, who asked me to stop pestering him and come back when the ultimate value add had taken place, so he could adopt that. Sadly we will never reach that point, but in the Age of Data a very significant value has been added by associating third party data with our own. And we now have the platforms like MarkLogic and the semantic analysis to make this work. Law has always been a front runner, having text susceptible to taxonomic treatment and a superfluity of documentation to be searched. Fortunes were made here in the 1990s. Until the 2007 recession it looked as if this would always be a litigator research led market. We now know that law can decline in recession. And, ironically, we also know that those who have zealously protected their “ownership” of public documentation in the past are having to defend their right to use it in the present. West, before Thomson, famously sued Lexis for reproducing punctuation in state law reports added by West editors. Now we have the delightful picture of both companies defending themselves against lawyers by resort to fair use, long regarding as the librarian’s defence against them. But the point is not the irony: it is that no archive is ever quite big enough or quite tagged enough to satisfy users whose expectations, created by us, are simple. Answers and Solutions. Are you ready for this, Mr Murdoch? Delivered to my smartphone, please!
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