Monster's Big Q
Reading through Monster's Q1 2006 earnings release is r-e-a-l impressive.
TTM revenue of $1.03 bn
2006E revenue of $1.05 bn for Monster alone
35% OIBDA margin in North America
You know, I haven't done the analysis in a while, but I recall concluding that most internet businesses seemed to end up at 35% EBITDA margins at scale. Blow-outs like Google and blow-ups notwithstanding.
Amazing quarter for the Monster guys....
Now I wonder when the wags in our industry are going to stop saying foolish things like "Monster's on its way out." The professional pundits and the amateur analysts of online recruitment proclaim the death of Monster due to this or that new site, business model, portal, etc. They've been doing it for as long as I've been in the business.
I had the very intelligent head of corporate development from one of the big names explain to me over lunch the other day that Google Base was going to cannibalize Monster's business.
Now I can appreciate that someone involved in technology investing would see a new technology as a threat to an old one.
But job boards aren't really a technology business. The advanced features and components can be, if done correctly, but at its core, a job board is a database plugged in to the internet. That's why Craigslist, for all its simplicity and lack of features, is not considered an order of magnitude worse in its utility than the big guys.
As I pointed out in this post on job board creation, it is brazenly easy to start up a job board. If something is so easy to do, it can't be hard (to coin what should be a Yogi-ism).
And if it's not hard, it's creation can't be the driver of value. Which the presence of 30,000+ dead job boards would pretty much confirm.
So if it's not the job board itself, what does create value for Monster, or, for that matter, us here at TheLadders.com?
It's the audience.
Just like Time Magazine doesn't derive its value from the paper its printed on, but its reach, scope, and relationships with advertisers; Monster derives its value from its reach, scope and relationships with recruiters and the companies they recruit for.
So a new technology is not fundamentally threatening to Monster's franchise.
And they're going to continue to post great quarters like this one.
For a long, long, long time.
I'd launch into Part Two of my "Monster's-not-going-away" tirade, but its late and I want to finish my work so I can get out of the office.
Later!
