In a strange decision last week, The Times Online dumped propertyfinder.com as its real estate search partner in favour of globrix.com.
Now News International, the publisher of The Times and The Times Online is a 50% owner of both propertyfinder.com and globrix.com. In fact, the other 50% owner of propertyfinder.com is the REA Group from Australia and they are 58% owned by News Corp, the owner of News International, therefore News Corp really owns 79% of propertyfinder.com and only 50% of globrix.com.
Now what makes this an even stranger decision is that propertyfinder.com is a real busines with real revenues. In the 12 months to 30 June 2008, propertyfinder.com had around GBP 10.5m in revenues. (Source: REA Group Full Year Financials)
On the other hand, globrix.com, who operates a Free to List - Pay to Upgrade Model where the listings are placed on the site for free and then agents purchase google type ads around the search results and therefore generate revenues for the business. However, a simple search of the globrix.com site reveals that they are running a significant number of google adwords on the site indicating that they might be struggling to get agents to buy their packages. The revenues for Globrix would have to be significantly less then propertyfinder.com.
Therefore the question is, why would News International dump a business that they own 79% of and that has significant revenues (and is #2 in the UK market) in favor for a business that they own only 50% of, has insignificant revenues and is probably ranked in the range of 6 - 10 in the UK market?
The other question it raises is why does News International have investments in two competing property portals? Surely in such a competitive market, you need to back one or the other to really take on rightmove.co.uk? Perhaps the real answer is that you need to merge them both to create a better competitor for rightmove.