Los Angeles Business Journal

J2 Doubles Digital Media Business With IGN Entertainment Acquisition

By Natalie Jarvey Monday, February 4, 2013

J2 Global Inc. built its business on the success of its electronic fax services. But now the Hollywood company is also trying to establish a name for itself in the digital media world.

In November J2 acquired Ziff Davis Inc., the publisher of PC Magazine and ComputerShopper, for $167 million. And Monday the company doubled down on that purchase with the announcement that Ziff Davis has acquired IGN Entertainment, which owns several male-oriented websites, from News Corp. for an undisclosed price.

According to J2, the acquisition will more than double its digital media revenue. IGN Entertainment also has advanced technology for mobile access and online video, which will help Ziff Davis with its other properties.

“We think it’s a very nice complimentary acquisition,” said J2 President Scott Turicchi. “They bring good demographics and brands that are recognized.” IGN.com is a well-known brand for video game news and reviews.

Such significant digital media acquisitions might seem unusual for a company that maintains a large cloud computing business with services such as Internet faxing, online voicemail and email marketing.

But Turicchi sees the separate business divisions as complimentary. Just as J2 has helped small businesses transition from physical fax machines to online faxing, the company also plans to help traditional media transition online.

“We like technologies where there’s a transition or disruption from the way that things have previously been done,” he said. “In the media world, you have properties that were offline. How do they transition to the digital world? There’s an art to doing that and there’s a way to make money.”

J2 said it has been negotiating with News Corp. for the last 60 days to bring IGN into its portfolio. The company plans to evaluate IGN’s business in the coming weeks to determine how it will integrate the San Francisco company into New York-based Ziff Davis.

J2 plans to announce its fourth quarter earnings later this month, which could shed more light on the IGN purchase price.

The company’s shares closed up 44 percent, or 14 cents, to $32.01 on the Nasdaq.