FAQ
On February 29th, United Business Media (UBM) announced that it would restructure CMP Technology to become four independent operating businesses. Think Services is one of these newly-formed divisions. The following questions and answers speak to the strategy behind this development and provide more insights into both UBM and Think Services, and how they will relate to one another.
About the Strategy
- Why did UBM decide to split up CMP into four independent businesses?
- How will this change benefit these newly formed divisions?
- What was the process used to determine what parts of CMP went to which company?
- Are you breaking up CMP to make these businesses more attractive to buyers?
- You have restructured CMP Technology twice in the last nine months? Is this indicative of financial difficulties or failure to achieve profitable growth?
- What is the effective date of this reorganization?
- Will there be a corporate CMP group? If so, what will this group do and who will lead this group?
- So the CMP brand will be going away completely? What about the other CMP-branded divisions of UBM, such as CMP Asia and CMP International?
- I understand that the four businesses will continue to report into UBM - how will this work?
- Will each business have separate financials?
- What is the level of autonomy for the new businesses?
- Does each new business have a new name? How were the new names determined?
- What will be the focus of each business, and what will its products be?
- Please tell me more about United Business Media
About the Strategy
Top of pageWhy did UBM decide to split up CMP into four independent businesses? Top of page
To increase our agility and responsiveness to distinct customer needs, while providing even greater access to the global resources of United Business Media.
Over the last 3 years, United Business Media has invested over $225 million in CMP through a series of 18 acquisitions, and has further supported a wide range of new launches (on line, in print and as events, in the USA and worldwide) and organizational changes to create a next-generation provider of information and business services.
The process of moving to this structure has been organic and evolutionary and has been accompanied by consistently improving results over these three years. The restructuring of last June and our acquisitions have created four strong media businesses, each capable of delivering an integrated suite of media products, marketing solutions and services to separate and distinct communities within the technology sector.
The decision to take this latest step in the ongoing transformation of our business is based on the positive customer feedback we’ve received as we’ve transformed the company into an increasingly decentralized, highly innovative organization, and on the strong financial results that each of the individual businesses are delivering. Creating four independently operating business will unleash new growth and innovation by allowing each of the businesses to evolve in the ways that are best adapted to the needs of their distinct markets, with even greater agility and speed than under the more centralized structure.How will this change benefit these newly formed divisions? Top of page
This new structure will enable each of the four newly-formed media organizations to be even more nimble and responsive to market needs and to opportunities to deliver innovative media and information services.
For our largest corporate customers, we will retain a common sales and relationship team that can develop creative marketing programs that leverage not only the four technology businesses but also the wider global media assets across United Business Media.
What was the process used to determine what parts of CMP went to which company? Top of page
A detailed analysis was conducted by UBM, which involved input from a number of customers, market analysis and interviews with a wide circle of CMP executives at various levels in the organization.
Each of our divisions is designed to serve the needs of a distinct segment of the broader technology market: the business technology market, the channel, the electronics and engineering market, and the software and game developer market. This strategy of moving each of these businesses closer to the communities they serve has been validated over the past year as the autonomy of each group has been increased.
Are you breaking up CMP to make these businesses more attractive to buyers? Top of page
No. UBM has been consistently investing into the area of technology media and believes the wider Technology markets offer great opportunities to generate growth and hence improve returns to UBM shareholders. We believe that this is the best strategy for continuing to improve the returns to our shareholders from increased growth and improved performance as our markets continue to evolve in the coming years.
You have restructured CMP Technology twice in the last nine months? Is this indicative of financial difficulties or failure to achieve profitable growth? Top of page
On the contrary: CMP has just posted year-end 2007 financials that exceeded expectations in both revenues (with the first underlying growth evident in many years) and bottom-line profits, which increased 30% over the previous year. 2007 was a better year than 2006. 2006 was a better year than 2005. We are on an improving trend here – and one that stands comparison with any of our competitors.
How the New Structure Will Work
Top of pageWhat is the effective date of this reorganization? Top of page
The new structure will take effect March 1, 2008.
Will there be a corporate CMP group? If so, what will this group do and who will lead this group? Top of page
There will be a corporate UBM Central Resources group, reporting in to COO Scott Mozarsky. This group will be responsible for providing the base for the wider Key Account Group and for the delivery of some central services to the new companies. Some of these services will include IT, Legal, Payroll, etc. UBM's US Head Office will become a part of the UBM Central Resources Group performing the functions that the existing US Head Office departments currently perform in a manner consistent with past practice. The reporting lines for the US Head Office functions will also remain consistent with the existing structure.
The CMP corporate name will no longer be used.
So the CMP brand will be going away completely? What about the other CMP-branded divisions of UBM, such as CMP Asia and CMP International? Top of page
Our research has shown that in most material ways in the technology market, CMP is not a “brand” as far as the audiences and customers understand the term. The audiences in particular relate to the brands of our key products – be it our market leading titles, events, services and web sites. And looking to the future we are trying to put the audience at the heart of what we do
The renaming of the divisions is not a change in brand – it reflects a deep change in organization and the recognition that the company has changed profoundly over the last 3 years.
A number of other UBM divisions use the CMP name in one or other format. In those situations it is NOT used as a BRAND to face consumers but as the name of the organization. We are not seeking to change those corporate names.I understand that the four businesses will continue to report into UBM - how will this work? Top of page
Each of the new companies will have a CEO that reports directly to David Levin, CEO of UBM. The four new CEOs are Philip Chapnick, CEO of ThinkServices; Bob Faletra, CEO of Everything Channel; Paul Miller, CEO of TechInsights; and Tony Uphoff, CEO of TechWeb. Each of the four companies will have a Board of Directors including some executives in the unit and some from the UBM group, which include David Levin, Nigel Wilson and Scott Mozarsky
Will each business have separate financials? Top of page
Yes, each of the companies will maintain independent profit and loss statements.
What is the level of autonomy for the new businesses? Top of page
Each new business will be completely autonomous, with separate reporting into UBM. It will create its own brand and business culture, and pursue new opportunities, including acquisitions and launches. Each company will have an independent management team and board to create and deliver its strategic plans.
Does each new business have a new name? How were the new names determined? Top of page
Yes, each of the new companies will have new names: TechInsights, previously the Electronics group, TechWeb, previously the BTG, Everything Channel, previously CMP Channel, and Think Services, previously GDIG. We need to stress that the key names here remain the market-facing brand names of our products and services, which are not changing.
About the Four New Businesses
Top of pageWhat will be the focus of each business, and what will its products be? Back to top
TechInsights a global media, professional services and marketing services company that serves decision makers in the electronics industry – the Creators of Technology – and the suppliers that wish to connect with them and influence their product design decisions. TechInsight has global revenues of over $85 million a year.
Everything Channel is the global leader in Channel execution, is the one stop shop for the indirect sales channel that drives 75 percent of technology sale throughout the world. Everything Channel has global revenues over $70 million a year
TechWeb is the global leader in business technology media connecting more than 10 million technology buyers and sellers worldwide. TechWeb has global revenues above $160 million a year.
ThinkServices connects specialized communities worldwide using innovative media, educational events, consulting, training and certification. Think Services has global revenues over $65 million a year.Please tell me more about United Business Media