New York, NY – Over the past twelve months, whenever someone has discussed investment banks marketing independent research to their institutional customers, they have typically discussed the efforts of Goldman Sachs with its Hudson Street Services platform. However, another major investment bank, Merrill Lynch, has recently begun to reveal its own efforts in this regard. Last week, Merrill Lynch announced that it had entered into an exclusive distribution arrangement with Global Media Intelligence (GMI), an independent research service focused on the international media industry. GMI is a market research service designed by London-based Screen Digest and its recently acquired California-based subsidiary Adams Media Research specifically for media-focused institutional investors. The GMI service is supported by over 40 analysts covering TV, motion pictures, video games, mobile media, home entertainment and broadband media tracking 300-plus companies in 50-plus countries. Screen Digest has been working for the past two years to develop the GMI service. The purpose of the GMI / Merrill venture is to integrate the proprietary research and data collected and produced by Screen Digest and Adams Media Research with Merrill Lynch’s investment research expertise and to market this unique and innovative primary research service to Merrill’s institutional client base. As a way to introduce this new service to buy-side clients, Merrill Lynch and GMI will host a media investors’ conference on November 13th.The exclusive arrangement with GMI follows two recent moves by Merrill Lynch in the alternative research space, including an $11 million investment in Indian analytics and research outsourcing firm, Copal Partners, and another minority investment in environmental, social, and governance data provider, Asset4.
Copal, which provides considerable outsourced analytic help to a variety of investment banks is now partly owned by Merrill Lynch, Deutsche Bank, and Citigroup. In recent years numerous investments banks have been steadily outsourcing an increasing amount of their number crunching and model building jobs to cheaper markets like India, where the country’s huge population of educated young professionals can save millions of dollars in salary costs. More recently, a number of mutual funds and hedge funds have been adopting a similar outsourcing strategy to help the firms cost effectively expand their internal research capabilities.
Earlier this year, Merrill Lynch also acquired a global license to incorporate ASSET4’s integrated ESG databases into its investment research. In addition, Merrill Lynch entered into a strategic marketing relationship with Asset4 and the firm made a minority investment in ASSET4. ASSET4 provides a unique database of close to 900 specific economic, environmental, social, and governance time series, plus the analytic tools necessary for institutional investors to track, analyze and benchmark the practices and performance of their funds, portfolios and companies. Previously, Asset4 had entered into an exclusive marketing arrangement with Goldman Sachs’ Hudson Street Services.
These moves seem to be a part of Merrill Lynch’s evolving strategy to provide buy-side clients with unique research services and non traditional analytic capabilities that are complementary to the firm’s fundamental research product.Of course, firms like Merrill Lynch and Goldman Sachs are investing in these “alternative research platforms” with a commercial purpose in mind as they believe that providing introductions to innovative research, analytic tools, and proprietary databases will enable them to deepen their relationships with clients and ultimately generate additional equity commissions to pay for these alternative research services.The full text of the Press Release announcing the new Merrill Lynch deal with GMI follows.
Merrill Lynch Agrees to Exclusive Distribution Agreement With Global Media Intelligence, a Producer of Independent Research in the Media Sector
NEW YORK, October 30, 2007 — Merrill Lynch has entered into an exclusive distribution agreement with Global Media Intelligence (“GMI”), an independent provider of leading research on the media industry. Merrill Lynch and GMI will jointly host an investors’ conference about the media sector on November 13. Subjects to be analyzed at the conference will include the impact of digital delivery of content on media companies.The objective of the agreement is to marry Merrill Lynch’s award-winning, in-house research with GMI’s leading data and analyses on the media industry, in order to provide Merrill Lynch’s institutional clients with a unique content offering.GMI is owned by Screen Digest, whose business — long viewed as a premier source of data, analyses and forecasts for the global media industry — was further strengthened this month by its purchase of California-based Adams Media Research. Adams is itself a leading source of independent research on the U.S. media and communications sectors.
“This partnership with GMI is a natural extension of Merrill Lynch’s global commission management offering,” said Michael Lynch, managing director in Global Equities at Merrill Lynch. “Our research, sales and trading professionals are uniquely positioned to identify independent research providers with specialized expertise relevant to our clients’ investment processes.”
“Screen Digest and GMI offer unique, high-quality data, and I am certain that this relationship will enrich our interaction with our own clients as they engage in the process of evaluating their media investments,” said Jessica Reif Cohen, managing director and senior media research analyst at Merrill Lynch.
“We are delighted to partner with Merrill Lynch and to jointly host an investors’ conference on the media industry,” said Allan Hardy, managing director of GMI. “We have now spent nearly two years creating an in-depth service, tailored to institutional investors in the media industry that draws on the knowledge of our 40-strong team of analysts. We are extremely pleased that Merrill Lynch sees GMI’s service as a valuable complement to its own excellent investment research on the industry.”
About Merrill Lynch
Merrill Lynch is one of the world’s leading wealth management, capital markets and advisory companies with offices in 38 countries and territories and total client assets of approximately $1.8 trillion. As an investment bank, it is a leading global trader and underwriter of securities and derivatives across a broad range of asset classes and serves as a strategic advisor to corporations, governments, institutions and individuals worldwide. Merrill Lynch owns approximately half of BlackRock, one of the world’s largest publicly traded investment management companies, with more than $1 trillion in assets under management. For more information on Merrill Lynch, please visit www.ml.com.
About Global Media Intelligence
Global Media Intelligence (“GMI”) is a market research service designed by London-based Screen Digest and its recently acquired Carmel, California-based subsidiary Adams Media Research (“Adams”) specifically for media-focused institutional investors. The GMI service is supported by over 40 specialized analysts covering TV, motion pictures, video games, mobile media, home entertainment and broadband media tracking 300-plus companies in 50-plus countries. Screen Digest and Adams have 36 years of knowledge, research, data intelligence and strategic consulting services. Through their world-renowned databases, in-depth research reports and direct analyst access service, Screen Digest and Adams will strive through the GMI service to bring customizable insights and thought-leadership to the investment decision making process.