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April 19, 2007

Experian consumes Hitwise

Today's news (so much more interesting than the Google earnings call) is that credit-rating and demographic data provider Experian has bought online competitive data provider Hitwise, for $240m in cash. The rationale for Experian is that Hitwise complements its existing portfolio of marketing services, which mainly lie in the area of data provision for 1:1 marketing efforts (i.e. lists). The main other offering Experian has in this area is CheetahMail, an e-mail management solution.

Apparently Experian has been partnering with Hitwise for the past four years, so the companies clearly know each other well (others put the acquisition down to Hitwise's excellent blogs which contain a lot of free and very interesting data). Clearly Experian hopes to enhance its targeting profiles with information about the kinds of website that people in a certain demographic use, which is (I think), a smart move - assuming Experian/Hitwise can pull it off technically, and, more important, from a legal/PR point of view.

Like Allen Stern, I am a little concerned that Experian may be looking to attach browsing history to my credit score, but fortunately the technical and privacy hurdles make this a distant possibility. And I presume that Experian expect a big dividend from the synergy between the two companies, since at Hitwise's current rate of earnings (negligible profit on sales of $40m for the year just ended) it will be a long time before Experian gets its investment back.

But congratulations to the folk at Hitwise. I know a few of the guys there from my London days, and they're a good bunch. Let's hope they thrive within the Experian fold.

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