If the acquisition of New Century Education Corp., goes through as expected this summer, Byron Preiss Multimedia (BPM) will be poised to give some old-line education software companies a run for their money.
BPM, a publicly held New York corporation (Nasdaq: CDRM), has been quietly transforming itself into an education software powerhouse. The multimedia company has previously been known for consumer entertainment titles such as the CD-ROMs “The X- Files” and “Total Titanic: A Night to Remember.”
But if BPM buys New Century, a respected second-tier interactive curriculum system company, by the end of June, industry insiders predict BPM will become a serious competitor to the likes of Computer Curriculum Corporation (CCC), Jostens Learning Corp., The Learning Company, and the school software division of Cendant Corp.
Unusual business matchups
If BMP does go head-to-head with CCC, Learning Company, and others, the situation will make for some unusual business matchups. One of BPM’s subsidiaries is a distributor of popular titles from The Learning Company. And entertainment and communications giant Viacom International could face the prospect of competing against itself. Viacom owns CCC and also holds a 20 percent ownership share of BPM.
“We’re making a move into educational multimedia because we think it’s one of the fastest growing markets out there,” said Paul Kolker, a BPM spokesman.
BPM says it’s pursuing a three-pronged business strategy: (1) developing educational internet products, (2) developing educational software for educational publishers and corporations, and (3) publishing educational software and marketing it directly to schools.
BPM cautions that its New Century purchase is contingent on concluding definitive acquisition agreements and winning stockholder approval. But if the transaction proceeds as planned, the New Century deal could become the latest in an extended string of acquisitions and partnerships designed to refocus BPM’s business strategy away from selling CD-ROMs through retail consumer channels and toward selling electronic instructional materials to schools through direct marketing, field sales, and internet-based marketing, the company said.
In recent months, BPM has acquired educational software developer Dolphin Interactive as well as Multi-Dimensional Communications Inc., the parent company of Orange Cherry/ New Media Schoolhouse, publisher of interactive titles such as “Rain Forest Explorer” and a leading reseller of such education software titles as The Learning Company’s “Reader Rabbit” series.
In March, BPM completed a merger with OnRamp School Productions Inc. of Denver, which became a wholly owned subsidiary of BPM and immediately changed its name to Internet Education Group (IEG). BPM brought in Neal Tomblyn, best known as one of the developers of Yahooligans!, to serve as IEG’s CEO. IEG creates secure web environments for schools. BPM’s latest gambit came on April 15, when the company launched a dedicated internet store (http://www.newmediaschoolhouse.com) for the sale of educational software.
‘A good fit’
Kolker said the deal to purchase New Century should be completed by the end of June. He called the merger “a very good fit for us.”
According to Electronic Education Report (EER), a biweekly newsletter published by SIMBA Information Inc., the New Century deal also adds a 13-person sales force to BPM’s marketing team, which will immediately strengthen BPM’s position in the K-12 market.
New Century’s chief product, its Integrated Instructional System, combines curriculum, assessment, and management software into one system. New Century estimates that more than 250,000 students use its program annually.
BPM President Byron Preiss told EER, “We see an enormous opportunity to repurpose and repackage [New Century’s] content, and sell it in new ways.”
BPM plans to leverage New Century’s content into new products, but Preiss said there are no plans to move, cut, or significantly change any of New Century’s operations. New Century President Dennis Tarzian reportedly will remain in charge of the company, which employs about 70 people.
Byron Preiss Multimedia
New Century Education Corporation