In an effort to offset declining print revenues,
Gannett Company Inc
) announced the acquisition of BLiNQ Media LLC, provider of social
media marketing solutions for companies. However, the financial
terms of the deal were not disclosed.
The move comes as part of Gannett's strategy to revamp itself by
increasing its digital applications, which are in high demand. This
trend is also evident from the company's recently concluded
quarter, wherein company-wide total digital revenue rose 12.9% to
$311.7 million, driven by higher digital advertising and marketing
Currently, advertisers are migrating to the Internet, owing to
increasing online readership and lower online advertising prices
compared to print. With the ever increasing demand, the acquisition
keeps Gannett well poised in social media marketing as BLiNQ is the
industry leader in managing social media marketing campaigns.
Advertising, which remains a significant source of revenue for
the company, is largely dependent upon the global financial health.
Thus, Gannett is taking initiatives to diversify its business
model, shielding itself against any economic onslaught by adding
new revenue streams.
Gannett is also repositioning itself for improvement in print
and digital media through a new subscription based model, whereby
subscribers will be able to access the paid content through
websites, mobile and tablet, and will have the preference of
choosing the frequency of home delivery of print editions. On the
other hand, the company will limit the number of free articles that
a non-subscriber can access.
However, the concept of pay-and-read model is not new as the
The New York Times Company
) are already charging their readers for online content.
Currently, we maintain our long-term 'Neutral' rating on
Gannett. However, the company holds a Zacks #2 Rank that translates
into a short-term 'Buy' recommendation.
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