Thomson Reuters: A Phase Change to Monitor

April 16, 2021

You may not be familiar with a beaver sejant erect proper blowing upon a hunting horn in silver with a big deer in the mix. You may not recall the origins of Thomson Reuters (TR) as a seller of radios in Ontario, Canada. You may not remember the shift from newspapers to professional publishing. That’s not a surprise. Most people do not know the names of the hundreds of specialty titles generated by the “slicing and dicing” of Thomson Reuters’ professional content. Some may be aware that Thomson Reuters is undergoing another transformation or a return to its roots.

Reuters Website Goes Behind Paywall in New Strategy” reports a shift this way:

The newly revamped is hoping to attract professional audiences prepared to pay $34.99 per month for a deeper level of coverage and data on industry verticals that include legal, sustainable business, healthcare and autos.

In the online business, there are numerous ways to generate money. TikTok videos does not seem to be a good fit for a professional publisher at least yet. TR has a “must have” history; that is, the company produces information that professionals have to buy to remain in business or obtain the data needed to stay in business. Examples include legal information and dozens of other electronic properties. You can get a reasonable list at this location. There are about 1,500 products.

Selling to law firms and accounting firms has become tricky. There are lots of lawyers and accountants, but there are not too many who can afford the “must have” online products and services. Selling to libraries has also become difficult. There are low ball vendors who offer good enough content, but the big challenge is thumbtypers. These rascals perceive the Google as the universal library, and it appears to be free to use. Pesky government agencies make some content available which erodes the lawyers’ and accountants’ appetite for spending money for online, loose-leaf services, and books. A lawyer or accountant can use a stock shot of bookcases and convey to a client a deep library of knowledge whilst working from a space in the kitchen.

Newspapers don’t work, and TR is unlikely to give Substack a whirl. TR may acquire Substack, but that’s a different approach. YouTube could be a source of revenue, but certain information like explanations of indifference curves almost demand a traditional classroom and old fashioned study groups in student unions or coffee shops.

The wizards with spreadsheet fever assume that a “professional” business person will have to subscribe to the TR product, the socially sensitive New York Times, the estimable Murdoched Wall Street Journal, the magazine called a newspaper with the fetching title “Economist,” and the orange Financial Times. Toss in the HBR and maybe a specialized service providing milspecs, and the money will just roll in. What if it doesn’t? Hey, change the assumptions. “Exercise” the model. Works like a champ.

How many business professionals will pay for these digital subscriptions? How many will sign up for the TR online service? How much will the “professional” business person pay each month to stay informed?

I don’t have a crystal ball, but the financial reports of TR and its fellow travelers will be fascinating to review. If university MBA programs survive, perhaps there will be a case study of the consequences of the digital revolution upon the great pivoters. The proof is in the revenue assuming the executives’ incentive plans are well crafted.

TR’s competitors are probably going to do some stag hunting in order to survive. They too have to make a buck.

Stephen E Arnold, April 16, 2021


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