This morning, News Corp NWSA announced plans to acquire Move Inc. MOVE, the parent company of Realtor.com, for $950 million.
The acquisition marks the latest move that the publishing arm of News Corp is making to expand its business beyond newspapers; the last acquisition was of Harlequin Enterprises, a romance novel publisher.
News Corp’s entrance into the real estate listing market comes just two months after the giant in the space, Zillow Inc Z, agreed to buy competitor Trulia Inc TRLA for $3.5 billion.
The question is: Can News Corp’s latest acquisition make it competitive when the behemoth of Zillow combines with Trulia?
Brad Inman, the founder and publisher of real estate news site Inman News, believes it will.
“For certain, News Corp’s acquisition of Move changes the chessboard of online real estate. Any hubris at Zillow headquarters in Seattle has suddenly been clipped,” he wrote.
However, as he added, it could also make things a bit easier for Zillow. It's possible FTC approval of the merger is more likely now that the company will have greater competition.
Inman has faith that Rupert Murdoch will be able to succeed in the space, citing News Corp's acquisition of Dow Jones in 2007 as an example of a once-criticized, now generally applauded move in publishing.
Moreover, he believes that Murdoch’s experience with the Melbourne, Australia-based REA Group, a global online real estate advertising company based in Australia and majority owned by News Corp, will serve as a helpful asset. “I expect his team in Australia’s REA Group to make a significant contribution after the acquisition,” he wrote.
Inman believes that the move will be good for News Corp, but also, for the whole industry.
“Most importantly, this move will spawn greater innovation for the consumer and better offers to agents and brokers. Some will argue it gives the real estate industry relief from a monolithic distribution partner, solving a vexing problem in one clean sweep,” he wrote.
At the time of this story, Move's stock price is up 36.95 percent on Tuesday, News Corp’s is down 0.36 percent and Zillow’s has fallen 2.48 percent.
Disclosure: At the time of this writing, the author had no position in the equities mentioned in this report.
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