Sensis to Sell Back Trading Post?

The Kelsey Group’s blog reports on a possible sale by Sensis of their Trading Post classified property.

After being one of the first directory companies to enter the classified market, Telstra’s Sensis has placed its Trading Post property for sale. According to a report in The Age, “Sensis paid $636 million for the fading publication three years ago, but after continuous revenue declines and senior executive departures, The Trading Post is back on the block for a price believed to be no higher than the telco paid in March 2004.”

The motivation to sell the property seems to have come after the departure of John King, who appeared to be the last major supporter of the venture. This is startling news given Sensis’ much touted strategy of bringing together businesses and consumers in an open trading environment. Sensis has had the golden touch with most of its ventures, so the failure of The Trading Post seems at odd with the company’s goal of being the local media of choice in Australia.

The The Age article adds:

It it is clear that revenue from the publication has been declining, despite growing revenue in the wider $10 billion Sensis empire. Sensis said revenues at The Trading Post were down 7 per cent in the six months to December. The sale of The Trading Post will be the latest in a long line of unsuccessful attempts by Telstra to diversify, including a number of dot-com ventures and troubled joint ventures in Asia. (…) Sources close to the company said attempts to centralise management functions at the previously independent publication had backfired. Broking analysts believe the group did not have the management skills to shift customers online from the weekly print publication.

James Kirby, editor of Eureka Report, adds in an editorial: ” With the planned sale of The Trading Post, Telstra is acknowledging it does not have the expertise in traditional media to recreate the publication as a successful print/online hybrid, which it must become to survive.”

What it means: in a really surprising move, Sensis seems to be interested in selling back their classified division they bought just a few years ago from Trader Corp. It’s a move I don’t understand. Did they paint themselves in a corner by promising to double revenues by 2010, a tall order indeed? In any case, in a world where the winner will be the
one who controls the data
, this is, IMHO, not necessarily a good move by Sensis.

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