Taking the top job
01.01.70 | Tom Tivnan
John Fallon certainly has some big shoes to fill.
In her 16 years at the helm of Pearson, Marjorie Scardino transformed the education giant and Penguin-owner into the world’s biggest publisher and by its last full-year results in 2011, she had tripled revenue to around the £6bn mark, and profits to £942m.
More important than the numbers which made her a City and Wall Street darling, Scardino led the root and branch change of Pearson from a somewhat dowdy textbook publisher with some rather odd non-core businesses (Pearson used to own the Madame Tussauds parent company, for example), into a streamlined content and technology-driven powerhouse.
Under Scardino, Pearson has expanded the very meaning of what a publisher is. In The Bookseller four years ago, Scardino highlighted the digital-driven strategy when she said that “textbooks were now an add-on”. The company’s education revenue streams now include the testing and qualifications service Edexcel and the online learning system eCollege and it most recently launched Pearson College, a higher education degree course.
It is, however, not surprising Fallon takes over the top job. It has been his part of the business, Pearson’s international education division, which has been the fastest growing part of the company’s portfolio, with revenues of around £322m when he took over, rising to £1.6bn last year. That growth has been partly due to his astute acquisitions, partly due to expansion into burgeoning new markets that are hungry for education materials.
International education will undoubtedly remain Fallon’s focus even as he assumes the overall reins (particularly after he disposes of the Financial Times business, as most analysts expect). Yes, the Penguin trade side is ticking over very nicely indeed and expanding internationally. But the engine of the company will be education and academic sales in territories like India, China, the Middle East, Brazil and Latin America.
There is a saying in golf that you drive for show, putt for dough; meaning the flashy stuff does not make the money. Fallon’s appointment perhaps underlines something about digital driven modern publishing, at least for big groups like Pearson: while trade books grab headlines (and their divisions sometimes, but not always, make money), it is education, academic and STM publishing sides which will truly bring in the dough.