The RBI-US Garage Sale

Reed Elsevier has been trying to sell their Reed Business Information division for well over a year now, with no takers. Plan B, it appears, is to retain the most valuable publications in the portfolio as part of parent Reed Elsevier and dump the rest on whoever will buy them piecemeal and failing that I suspect they will simply shut them down.

Having completed our portfolio review, we have decided to focus our efforts and investments on a narrower range of brands and markets, and with this in mind we are announcing today our intention to divest a significant part of the RBI US business.

While we will be retaining Reed Construction Data US & Canada, RS Means, Variety, Marketcast, LA411 and Buyerzone within RBI – these are businesses that fit well with our plans and they are leading brands in their markets – we are announcing today our intention to sell all the other publications and services in RBI US, as well as their related titles and services in Asia.

[From Nikki Finke's Deadline Hollywood Daily » Behind-The-Scenes Of RBI-U.S. Fire Sale]

RBI is focused on B2B publications in many verticals, I think they had as of last year over 120 publications in that division representing markets as diverse as farming to financial services to the entertainment industry. Their situation underscores the degree to which B2B media has been devastated by the internet, with readers and advertisers all fleeing publications that were once staples of every business category.

What is the solution? For one, moving to more of a data service model instead of publication seems to be working for groups like McGraw Hill Construction and Dow Jones, but beyond that I am not sure what the recipe for success is. Clearly expense control is a major strategic focus, and when the economy rebounds a renewed focus on events and other services aimed at matching vendors with customers. The traditional analyst firm model seems outdated as well, so perhaps a merger of the two related segments is in order.

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The Lesson From Cash For Clunkers

If the much talked about Cash for Clunkers program from the federal government has taught us anything it is that 1) the government imposes a lot of programmatic complexity for everything it undertakes and this should be a warning sign to those proposing the government take over healthcare insurance, and 2) of all the promise that the various stimulus packages have made, the one that actually put money in consumers hands is the one that worked.

On that second point, if direct financial incentives to consumers are effective, then why not simply cut taxes and put money in the hands of consumers? Of the trillions of dollars that has been promised into the system over the last 6 months the borrowing costs alone could fuel significant tax cuts.

Congress passed the President’s $800 billion spendulus plan in February and it has clearly not had the promised effect, all the while unemployment has gotten far worse than the President himself promised would happen if his package wasn’t passed. Meanwhile, a program 1/800 the size of the Feb stimulus package actually stimulates economic activity, a fact that should be an embarrassment for this Congress and President, not a success story.

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