Breaking Views takes another crack at the $5 billion asking price for The Weather Channel and its website, and estimates that parent company Landmark is asking 20x ebitda multiple, “well above Yahoo’s and more than twice Discovery’s”.
That leaves us more confused than ever. Yesterday Michael Learmonth pointed out that last year NBC U bought Oxygen for $12 a sub, a rate which would value Weather Channel at $1.1 billion. If you argue that Weather Channel is a core cable offering — must-see viewing for a niche audience, and occasional viewing for a larger audience — perhaps you can double or triple that. So optimistically you’re valuing Weather.com at $2 billion.
Is that realistic? Without better insight into Weather.com’s business, we don’t know. But we are sceptical: More so than any other news niche, weather information is a commodity. Do you know who provides the weather news you rely on? We’re partial to Google’s weather (punch in your area code or city name and “weather” into the search box, and voila!), and we have no idea who’s generating that. Weather.com is undoubtedly a valuable URL, but beyond that, not sure what the site offers that isn’t easily duplicated or displaced.
Are we missing something?
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