Value of newspapers plummets to point that real estate is most valuable asset.
An article in the Boston Business Journal suggests that the most valuable asset of The Boston Globe is the land it owns. The Boston Globe is anticipated to lose $80M in 2009, but its real estate holdings may be worth $65M.
This is a common story. Because they need to be close to the action, many newspapers set up their headquarters near downtown. As city populations swelled and urban revitalization occurred, the land these headquarters sat on became the most valuable part of the company. When the Austin American-Statesman was posted for sale recently, many opined that its real estate would be a key asset.
The Boston Business Journal article quotes analysts who think The Boston Globe could sell off its Boston.com assets for $20M. Boston.com is one of the most successful city sites on the web and is ranked #254 by Compete.com.
I found this story particularly interesting after attending GeoDomain Expo last week. More and more geo domain owners are getting into the news business. But print newspapers drive a lot of the traffic to the corresponding web site. They complement each other. City.com owners will need to do more than just count on their brand if they wish to become news organizations.
[Hat tip to Rob Sequin for the article.]
Rob Sequin says
If the business is the website and the land is the domain name, the moral of the story is develop on a good domain name.
At least that way you have something if the business doesn’t work out.
I remember when Excite.com went out of business and Moniker auctioned off their assets, the domains were there only assets worth anything.
Mike Maddaloni - The Hot Iron says
The Globe’s HQ is in the Dorchester Bay area of the city, which has seen growth in the last few years. They had typical start-up offices for Boston.com in the Four Point Channel area – another growth area in real estate – but not sure if they leased or owned.
But as much as they have great assets, they never had relationships with their users. Namely, I never paid a dime to the Globe from when they went live in the 90’s until I left the area for any Boston.com content – main content or premium. Geodomainers should take this to heart if they want to get beyond PPC and banner ads.
mp/m