The potential bid for Dow Jones from GE and Pearson is looking even shakier today. Yesterday we noted that newsroom rivalry might derail support for the deal among employees of the Wall Street Journal and the Financial Times. Today the Wall Street Journal's Heard on the Street column points to other constituencies that are raising objections to the deal, including at least one member of the Bancroft family and some prominent shareholders of Pearson.
Heard on the Street agrees with our analysis that a Pearson-owned Dow Jones would likely seek cost-savings by reducing overlap between the Journal and the Financial Times.
The easiest way to meet the cost-savings goals would be for the newspapers to cut their biggest expense -- journalists. The Wall Street Journal has roughly 700 reporters and editors, and about 100 of them work outside the U.S., while the Financial Times has 510 journalists, the majority of whom are in the United Kingdom. While it is unlikely the two newspapers would be combined, they could share some stories, allowing the FT to cut its staff in the U.S. and the Journal to cut back in Europe.
The GE-Pearson bid looks weaker every time we glance in its direction. The Murdoch Meter gets moved up to the 85% mark today on the expectation that enthusiasm for this bid will continue to fade.
GE, Pearson on Defensive [Wall Street Journal]