IBM, Sears explore selling Prodigy on-line service; after $1 billion investment, move would illustrate pressure from Internet

Article Abstract:

IBM and Sears are contemplating the sale of their Prodigy online information service, as the service continues to lag behind competition in terms of revenue and membership, despite investments totalling over $1 billion. Each company has retained the services of investment bankers to determine the existing value of Prodigy and the likelihood of recapturing investments over the past ten years. The companies' interest in selling Prodigy is a sign of the increasing competition that commercial on-line services are facing from the Internet. Some analysts suggest that Prodigy will require investments of over $100 million per year in order to restore the service's profitability and increase its market share. IBM's overall networking strategy focuses on corporate Internet-based networks, and Prodigy's consumer-oriented nature may stand in contrast to this plan.

Telegraph & other communications, Specialized Telecom Services, Wired Telecommunications Carriers, Online services, Internet services, Sears, Roebuck and Co., S

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IBM in talks with Sears to take over management of Prodigy on-line service

Article Abstract:

IBM is conducting talks with Sears, Roebuck & Co regarding the management of its co-owned Prodigy online information service. Prodigy Services Co's board of overseers is currently made up of three IBM executives and three Sears executives. IBM believes that it could utilize Prodigy more effectively and make more significant changes to the service if the service was under IBM's control. Part of IBM's strategic plan involves integrating Prodigy with the company's networking products. IBM also hopes to streamline company operations in order to make the service more profitable. The company plans to integrate Prodigy with its Intelligent Communications system, which directs faxes and e-mail via the most appropriate means. It is still unclear whether Sears will consent to IBM's push for managerial control.

Management, Information services, Information services industry, Marketing Strategy, Prodigy Services Co., Company Business Management

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Stop the presses; publishers scramble into on-line services, but payoff is unclear; newspapers and magazines lose millions so they won't be left behind; interactive Tom Jones - live!

Article Abstract:

A number of newspaper and magazine publishers are exploring the possibility of offering electronic versions of their publications. As of Apr 1995, over 120 newspapers were offered in an electronic format, including the New York Times and the Casper (WY) Star-Tribune. Several dozen magazines are also available in digital form, including Time, American Woodworker, Industry Week and the New Republic. Industry analysts report that the cost of entering this new medium is high, with newspapers and magazines outlaying over $100 million per year in creating and supporting electronic publications. Moreover, the return on the investment is still speculative as advertisers have been slow to place ads in yet unproven digital publications.

Advertising, Advertising and Related Services, Newspaper Advertising, Publishing industry, Innovations, Forecasts and trends, Industry trend, Market trend/market analysis, Advertising (Industry)

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