Murdoch Gets Dow Jones, Now What?

As expected, Rupert Murdoch has successfully negotiated for himself a position in the Business and Finance vertical with a crown jewel brand, The Wall Street Journal.

Here’s my previous analysis on why this deal is a good one.

I really like News Corp’s verticalization strategy.

James Altucher asked Jim Cramer, “What’s the one thing the WSJ should do going forward?” They agreed that WSJ should not only have news, but also Opinions that can move stocks. Here’s my take on how that can be accomplished in a very Web 2.0 way.

Jim & James: The best way for the WSJ to introduce “dialogs” and “opinion” is by pulling together a blog network powered by a technology like Adify. There are hundreds of great business and finance writers out there with strong opinions, interesting insights. James, your Daily Blogwatch column links to many of them. These writers need to be woven into the Journal’s more News oriented coverage.

Now watch this.

Let’s say, the WSJ assembles 50 such cream-of-the-crop small publishers with good opinion and analysis content that can be nicely “networked” into the Journal’s anchor content. Over time, each of these publishers would be doing 4 Million Page Views a Month. The Journal’s Ad Sales force would be responsible for selling ads on these sites, and let’s say, they command a robust $150 CPM, given that it is a premium audience.

The revenue split could be as follows, to position effectively against Google’s AdSense, which pays publishers diddly nothing:

* Publisher gets 70%
* WSJ gets 20%
* Adify gets 10%

With that, each publisher would make $5 Million a year, and the Journal would make over $70 Million a year of insanely profitable revenue. If the network can expand to 100 such publishers, the revenue doubles, obviously. The beauty is, there already are hundreds of such publishers. It is the Networks that are not ready yet. Once the twain shall meet, magic awaits!

I would be devastated if Murdoch doesn’t comprehend the magnitude of this opportunity.