Corporate Profile: Reuters - on a Wing and a Prayer ; Reuters Has Come a Long Way since It Dispatched Information around the Country Via Carrier Pigeon. but after 150 Years Establishing Itself as Britain's Richest and Most Influential Media Company, It Looked as If It Might Be Knocked off Its Perch by the World Wide Web. That Was When Peter Job, the Chief Executive, Swooped Online

By McIntosh, Bill | The Independent (London, England), February 16, 2000 | Go to article overview
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Corporate Profile: Reuters - on a Wing and a Prayer ; Reuters Has Come a Long Way since It Dispatched Information around the Country Via Carrier Pigeon. but after 150 Years Establishing Itself as Britain's Richest and Most Influential Media Company, It Looked as If It Might Be Knocked off Its Perch by the World Wide Web. That Was When Peter Job, the Chief Executive, Swooped Online


McIntosh, Bill, The Independent (London, England)


The Reuters story transcends the rise of the value of information and the technology that disseminates it. From the flapping of carrier pigeon wings to the electronic hum of the world-wide web, Reuters has always aimed to deliver accurate, impartial information with the utmost dispatch.

What survived for a century and a half, often in precarious financial circumstances and occasionally in questionably close relations with the British government, has emerged in the last two decades to become Britain's richest and most internationally influential media company. Yet that 149- year history has provided little comfort in recent months as Reuters seemed to be losing its way in the information revolution wrought by the internet.

But last week Reuters, under Peter Job, its 58-year-old chief executive, threw down the gauntlet to rivals, with the launch of a pounds 500m plan to use the web to reinvent itself. Reuters, a wholesale distributor of news and economic data to newspapers and financial players since 1851, will from this summer offer on-line trading, news and analytical services to the world's fast-growing army of private retail investors.

"While it's been taken as a transformation, it is really extending the strategy we've had for many years," says Mr Job in his elegantly wood- panelled office in the company's Fleet Street headquarters. "The strategy we follow is being extended to wealthy individuals who have been unreachable. It's a transformation we're launching but with some limits to the risk."

The challenge is to maintain the lucrative monthly information subscription fees from 550,000 financial, business and government clients, while offering a lower- cost package of pay-as-go services to the world's estimated 50 million private investors. City dealers and fund managers pay $1,000 per month or more for their terminals and the crucial information flows they deliver. Private investors may only spend about $100 per month each, but they are accessible over the internet, a fast-growing new market expected to be worth $1bn in three years.

"With the Web, the US market is far and away the most advanced, both in terms of the size of the market and usage," says Mr Job, though he believes Europe ultimately offers a greater number of wealthy private investors. "We're trying to put our strategy on a global basis and we are targeting 10 countries such as Japan and Germany with local language content and locally produced web packages." He knows internet users won't pay for basic information - Reuters news is already beamed free to 900 web sites - but he believes other services will generate revenue. One obvious profit centre is share trading via Instinet, the biggest electronic trading platform for banks, which will be made available to retail investors. A new financial portal joint venture called Multex Investor Europe, will sell equities research, managed funds analysis, price quotes and other investment portfolio services. A further deal with Aether Systems of the US, a specialist in wireless financial transactions, will allow investors to execute share trades over mobile phones later this year.

"There is an opportunity as people go through these layers of data," says Mr Job. "There's also advertising and sponsorship. On top of that there is a cluster of things related to the transaction itself. It can be routed to Instinet or to another broker who will pay for the number of share orders coming down the pipe."

A further venture between Instinet and WR Hambrect, the San Francisco venture capitalist, will permit private investors to invest in new companies ahead of their market flotations. Hambrect's Open IPO online investment service has already brought several west coast firms to US markets, and Mr Job believes it is an opportune moment to launch the service ahead of an expected upsurge in European floats.

"Instinet is perfectly in tune with the way the market is trending," he says.

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Corporate Profile: Reuters - on a Wing and a Prayer ; Reuters Has Come a Long Way since It Dispatched Information around the Country Via Carrier Pigeon. but after 150 Years Establishing Itself as Britain's Richest and Most Influential Media Company, It Looked as If It Might Be Knocked off Its Perch by the World Wide Web. That Was When Peter Job, the Chief Executive, Swooped Online
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