Companies that sell information by subscription had a banner year in the Middle East last year despite the collapse of much of their client base in the financial and media sectors. Thomson Reuters, Bloomberg and Dow Jones all significantly expanded their operations in the region, with a strong focus on the Gulf, and plan to continue their expansion through this year.
Tom Glocer, the chief executive of Thomson Reuters, explained during a recent visit to Abu Dhabi that the allure of the Middle East was similar to that of India or China for companies that sell information to professionals. "The strongest correlation factor to our success is how many television stations have opened, how many newspapers, how many lawyers, how many bankers, how many accountants," he said. "And when you look at the world in that way, rather than GDP or consumer spending, this is one of the most rapidly professionalising regions in the world, in part because of the vision many of the governments who recognise that they need to build, not just a physical infrastructure, but the modern underpinnings of an economy."
Thomson Reuters has responded by hiring more than 100 people throughout the Middle East and Africa and expanding its offices in Dubai Media City, bringing total staff numbers across the region to 520. The company is also in talks with the leadership of twofour54, Abu Dhabi's media zone, to expand its presence in the emirate. "We have 20 to 25 people in Abu Dhabi, but what we are looking to do is significantly expand our presence," he said. "We were just having a chat about the ambitious vision of the Government because we really do think we have a significant opportunity here, including expanding our media business."
The Thomson Reuters Foundation, the charitable arm of the Canada-based corporation, was one of the founding partners of twofour54 and Thomson Reuters terminals appear in many of Abu Dhabi's major firms. The company is also looking at the capital as a possible hub for its healthcare business. Services for healthcare, financial, scientific and legal professionals have made up the bulk of Thomson Reuters' business since the company was formed from Thomson Corp of Canada's purchase of UK-based Reuters in 2008. The news agency business for which the company is best known makes up only about 2 per cent of the company's revenues and has taken a hit in the past year as struggling newspapers and websites cut their subscriptions, Mr Glocer said.
Similarly, Bloomberg makes most of its money from selling subscriptions to its terminals, with only a small part of its business coming from media companies. It, too, has been investing heavily in the Gulf, announcing plans in September to almost double its workforce in Dubai to 90 over the next year. Peter Grauer, the chairman of Bloomberg, said at the time that the company expected to increase the number of regional terminals by 2 per cent last year as sales began to pick up in the third quarter.
Bloomberg has opened offices in Riyadh and Doha as part of its expansion and is in the process of opening an Abu Dhabi bureau in twofour54, said Riad Hamade, the company's managing editor for the Middle East and Africa. "We're doing it because we're expanding in the region and Abu Dhabi is an important place for us to cover," he said. Unlike its rivals, Dow Jones is more focused on media sales and has tied up with Zawya for its subscription sales in the region. It has been expanding to beef up its coverage of the Middle East. Zawya Dow Jones last month passed the milestone of attracting 1 million hits for the year and is in the midst of expanding its bureaus in Saudi Arabia, Kuwait and Qatar, said Andrew Critchlow, its managing editor for the Middle East.
"We are averaging over 100,000 readers a month, which gives you an idea of how people are generally interested in news and are prepared to pay for news," he said. "I know this has become quite a topical subject at the moment, but we were doing this three years before this debate began swinging and if people want any proof that people are prepared to pay for high-value content, this is it." @Email:email@example.com