Thursday, December 18, 2008

Three for a buck?

CanWest stock hit 42 cents today.
Ooops, 34 cents.
Trade volume is suspiciously high, too. Someone is liquidating a big position for what they can get for it. Scary.
Six months ago, I suggested media convergence may be yesterday's news because the big convergence plays were tanking in the markets. Then, CanWest was at about $3.75, having lost more than half its value in the previous six months. Now Canwest is at about 1/20th of its summer 2007 price and about 1/40th of its recent peak. Quebecor does slightly better because of its investment in cable (though the company's newspaper interests are not integrated well into any kind of multi-use platform. CTVGlobemeia is hard to guage, since it has unusual factors such as the failed Teachers takeover of BCE and the deep pockets of the Thomson family (made a bit shallower by the tanking of Thomson Reuters).
The stock market isn't always an accurate guage of performance, but when shares in companies that adopted a model of leveraged buyouts/media convergence get stomped as heavily as CanWest, it's time to look for a new model.

So here it is, again:

Don't put anything on newsprint that readers can get on the Internet.

Don't post anything on the Internet that people can only get in your publication.


Anonymous said...

Hold that thought it hit 34 cents. How low can this thing go?

Stephen LaRose said...

Dumb question: where's David Asper getting his money for a new Blue Bombers' football stadium? I would think that he doesn't have any money left thanks to Canwest's share prices cratering ....

Anonymous said...

Hell of a breaking story...

Great shareholder value here.

bigcitylib said...

"Don't post anything on the Internet that people can only get in your publication."

What can't you get on the Internet, in principle?

I think the problem for papers is now if they don't give it away for free nobody will read it. Witholding stuff just means NOBODY reads it.

Ottawa Watch said...

You can't get local governmemt news and analysis. You can't get a local take on national news. You can't get local entertainment (including many listings). You can't get much local business news. You can't get local coirts or cop news... you see where I'm going with this.

Why, if you're selling a newspaper, would you ever have a Brittany Spears story? Why would you even have a stock listing page? Or TV listings when I can click a remote and get TV listings without hunting for an old paper?

Some information has value. Some is considered free, and people simply won't pay for it. Most national political news, sports and celeb news falls into those categories.

People will pay for local news and information they can use.

Anonymous said...

In Southern Ontario, you can get most of that local stuff if you want it at the Metroland websites for nothing. And will be able to do so as long as their particular economic model holds up.
And a far number of independent local news sites (London, Sault Ste Marie) though I wonder how they stay open.
Doesn't seem much more content in the pay Sun Media small dailies and weeklies than at the free Metroland publications.