Reuters in crisis
Ravi Madapati
Faculty Member
Icfai Knowledge Center
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Future outlook
By the end of 2002, it was widely feared that Reuters would issue a dismal
forecast for 2003. Reuters underperformed a buoyant FTSE 100 continuously in
early 2003. Although Reuters had not issued any guidance for 2003, analysts
expected sales to fall by 10%.
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Reuters’ major priority now is to implement the Fast
Forward plan. Reuters also needed to improve its customer service. Another
important priority was to launch next generation products starting with
Reuters Knowledge[1] . Most of its products had been launched many years
ago and there had been little product innovation. Reuters also needed to
bring down its costs. Fast Forward is primarily about doing the right
things in the short-term, to build up Reuters for the future. Whether Glocer would successfully implement Fast Forward or not is something only
time could tell. Meanwhile, technology spending was at its lowest in many
years. Glocer believed that launching cheaper variants of its existing
business would bring the much-needed growth. |
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He also planned to build on Reuters’ reputation for entering into equity
research. He intended to position Reuters as a wholesaler of independent
research. Transforming Reuters’ culture from a stifling bureaucracy into
something more dynamic and commercial remained a major challenge. Competition
from Bloomberg and Thomson was increasing. The investment banking business did
not look like it was going to pick up in the near future. Reuters had not faced
such a bleak situation in its 150-year-old history.References
1. “Setting Up Shop”, The Economist, February 10, 2000.
2. “No Miracle Yet at Reuters”, BusinessWeek, July 8, 2002.
3. Tomlinson, Richard, “Deadline for Reuters”, Fortune, January 24, 2003.
4. Schroeder, Mary, “Reuters Looks to Shift Development to Asia”, Securities
Industry News, February 10, 2003.
5. “Reuters Hopes Homes Will Rescue Profit”, Estates Gazette, February 15, 2003.
6. “Reuters Slides”, BusinessWeek, February 18, 2003.
[1]Reuters Knowledge is a browser-based global information and analytics service specifically designed to meet the needs of
investment bankers and research analysts. This product is yet to be launched as of June 2003.
© Icfai Press. Global CEO •
December 2003, All Rights
Reserved.
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