Global news companies Reuters Group and Dow Jones are forming a joint venture aimed at providing corporate customers with a one-stop shop for business information via the Internet.
The companies will combine their database services in a 50/50 venture called Dow Jones Reuters Business Interactive LLC, offering historical news from The Wall Street Journal, the Dow Jones and Reuters news wires, as well as more than 7,000 global business news and information sources in 20 languages.
The venture, with joint revenues of over $225 million in 1998, will combine the global reach of Reuters' existing Reuters Business Briefing service with the breadth of US sources offered on Dow Jones Interactive.
The alliance is aimed at strengthening Reuters' and Dow Jones' market position in the rapidly-growing business information market against rivals such as Reed Elsevier's LEXIS-NEXIS database and Dialog Corp.
According to industry estimates, the corporate information market may be worth some $6 billion by 2002, the companies said.
The deal includes a provision for Reuters to make an undisclosed cash payment to Dow Jones over time, but the companies declined to comment on specific financial details.
"There is very good growth potential in the sector, and you're going to be able to offer corporations an integrated product coming from the two leading providers of this type of service," one London-based media analyst said.
"Maybe one plus one equals 2.3 or 2.5 as opposed to just two," he added.
Besides extending their penetration in developed markets, the companies plan to use their combined market clout to exploit opportunities in the emerging markets of Asia, Eastern Europe and Latin America.
"Combining Dow Jones Interactive and Reuters Business Briefing will bring together the leading, state-of-the-art business `current awareness' and archival services in North America, Europe and Asia, which we expect to be a `must have' offering for every corporate desktop worldwide," Dow Jones Chairman Mr Peter Kann said in a joint statement.
The companies currently plan to launch the Web-based service within 12 months, while they will provide their proprietary content to each other's existing products in the meantime.
The deal is the second major agreement between Dow Jones and Reuters. Last October, Reuters signed a deal to offer the Dow's news wire services as an optional service to Reuters customers.
The new venture does not involve the companies' consumer Internet products, including The Wall Street Journal Interactive Edition and Reuters' digital new media products, nor their competing real-time financial newswires.
