Murdoch buys Milkround - Comment from Madgex and FDM

On the back of the news that Rupert Murdoch has acquired 100% of graduate recruitment website Milkround for a price estimated to be close to 20m, Julian Divett, COO of FDM, and Simon Conroy, Chief Executive of Madgex, comment on the sale.

Julian Divett, COO of IT graduate recruitment company FDM, It comes as no surprise that big names such as News International are starting to take an interest in online graduate recruitment sites. Online recruitment is an ideal way to reach communities. We have been using on-line recruitment for many years starting with Jobserve which began life as an email job bulletin. The big plus point to on-line recruitment has been its speed as jobs can be posted within minutes, and its cost which is normally a fraction of paper-based recruitment.

My big concern is that large firms like News Corps will begin monopolising this medium and push rates up. Paper advertising revenues have been hit dramatically with the huge growth of online advertising so they will be seeking to make up this lost revenue, especially after paying such a large sum for the website. The Sunday Times has almost doubled in price during the last 12 months so it would be a shame if the same happens to Milkround.

It is surprising that Google has not entered the fray - perhaps now is the time we will see some moves by the web giant into this area.

Simon Conroy, Chief Executive of Madgex, the UK market leader in B2B online publishing systems comments:

This is another example of a trusted, niche online community site being an attractive model for a player as big as Murdoch, and is a similar deal to eFinancialcareers which was announced yesterday by Dice.

The strategy behind the purchase is clear, in contrast to Murdochís other recent community purchase - MySpace - as commercially this works as a job board. The difference between the two deals is the merging of information and content with jobs, making this like reverse-model B2B publication.

The beauty of these acquisitions is closer to the offline world dynamics: buy a trusted brand and you also buy a consumer and user base.

The sense in the acquisition is tied into the overall brand. Someone like the Guardian has organically built positions in the public sector and media. News International is buying positions where there are synergies, cross-sell, brand allegiance and ígrowth as the customer growsí opportunities.