Wednesday, April 2, 2014

GCI: Strategic partnerships announced; may help drive top-line growth down the road

Gannett (GCI) made a couple of announcements this morning which we think are worth highlighting as they could accelerate ad revenue growh in the future.

The Company annoucned a partnership with The Weinstein Company that gives Weinstein access to GCI's content library (local and national TV, newspaper, and digital content) to help further monetize the content, likely lengthening the life of those assets.  We think with access to that library, Weinstein will do what it does best - create different TV programs (incl. reality shows), documentaries, films, etc. and distribute them.

We are not sure about the details of the partnership but GCI will likely get paid, whether its through royalty or one-time payment (royalty-free) on the content.  Once Weinstein creates and distributes the content, it may help GCI to also generate ad revenues.

The Company also announced partnerships with General Mills (GIS) and Latitude which could help generate additional ad revenues.  More specifically, the partnership with Latitude, a digital marketing agency, will enhance GCI's G/O Digital digital marketing services offerings in the UK, potentially helping to bring in more future ad and digital revenues.

Overall, we think these announcements were positive for GCI.  The Company is scheduled to report Q1 '14 results on 4/23 at 10AM (ET).

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