When did you decide it was for sale . John there was not a single moment. It was a progressive process, really, that i have along and has always been important to me to ask honestly we the best owners of the Financial Times term. E longer we have been fantastic owners of years. T. Over 50 i think we have been great guardians of the editorial of the y and quality journalism. F. T. To lso helped the become global, to make the analog to ft from digital. But the Inflection Point is a overused word but in this case i think it is entirely appropriate because increasingly we are now seeing accessing re people news, analysis, allstar through with twitter and facebook and all sorts of other emergiing channels and from more people shift decktop to mobile. That is a huge opportunity for times. Nancial it means it can reach its journalism to more people than before in its history but it is a great challenge as well remake and as to rethink how it makes and sells journalism. That requires absolute attention i think it d requires scale as well. The f. T. Is a 300 million pond journalism business in a five billion pound and it was siness going to be increasingly an icult not so much from investment. I think investment we could have ealt with but to bring the focus, clarity, additional insight and expertise and scale required by ly is that focus on being the very in journalism it can be. Francine what you seem to be saying it is very difficult to money in this business because of social media so it is becoming harder . The f. T. Does make money money. Last year profits were around 24 on sales of just over 300 Million Pounds and i very much believe that the f. T. A sustainable and profitable futu future. It the best way of ensuring can phbgs mice that is aximize that is by being part of a company that is focused on any alism and that is what k knee kay brings. It is a brit thing to be in. Has thecial purpose and benefit to be a profitable business. Been in the business of global likewise. Really important to the future of the world and great opportunities to grow. Those are two quite different horses and you cant simultaneously. Francine was there any moment n the negotiations you thought f. T. Is such a big brand we should not be letting it go . Hugely rsonally a difficult decision for me. 19u79 joined pearson in its ownership of the f. T. Is one thing that attracted me. Ironically, the synergy between the f. T. And rest of pearson are greater now than any time since 1997 and all the time i have with pearson but they are s obtained that can be through partnership and one way nikea is the one we formed with them the last few years. Emotional decision for me and the board. It was not one we took lightly. Was a year or more of very deliberate process of making evaluated and worked through the different factors, f one that was taken after extensive consultation engaging leadership ditorial of the f. T. As well and reaching this conclusion that this is a time been ournalism has my ought and reinvented and job was to get the f. T. The best crack of emerging in better before. An francine does it mean in the negotiations and final contract you preserved, i dont know if you can do it by cause or getting lawyers but you preserved the journalistic independence of the f. T. . View on these things is that what is most important is owner and you ht go to the right owner in terms the values, the leadership and the track record. I think everyone would acknowledge this pearson has been a good owner of the Financial Times. Not a word set down any here i, theres no constitutional pact, theres in governance, theres no structure i took over prosecute the predecessor there is no document is there because it is an innate part of the culture. About n we were thinking the best future of the f. T. That it. The way we approached because i think you could put in or e any sort of document constitutional arrangement of frank i think people values while matter more and nikkei in a japanese coffin text the f. T. I from believe there is that real commitment to editorial idependence and integrity and think they really value the f. T. Day communicated the next to all staff and sets out more han any constitutional sort of working party or Steering Committee could what is most important. After the oming up pwraebreak education, digital ct and technology are driving the business. More about s much how do you make the teaching and earning much more effective, much more engaging. Francine back in a few minutes ith more on that exclusive conversation with pearsons c. E. O. John fallon. Francine the Publishing Industry has been impacted by growth of digital technology. Exclusivelytells me how adapted the business to changing this ever environment. John in Education Technology is much more about how do you make and learning much more effective, more engaging. Provide greater insight. Employee. Starbucks francine which country . In america in be case and they get stock stuck on a problem. T is an Adaptive Program so maybe it is east tkwroer help them through with the problems they are doing online. It is clear they are finding it easy to do and get a little push them on to something more challenge willing. If we see they are struggling to a particular concept we will see do you want help here and now. It could be in america, can be chat or pops up through perhaps on skype so it is more ersonal and adaptable and driven by the needs of the student. It is more engaging because you using technology and using better Data Analytics so you nderstand very specific movements in this students understanding but it is much affordable as nd well. Example we n that can help the 22yearold great e in china who has grammar and vocabulary in speaking andax the listening skills to get that job with a global corporation. We can help y perhaps the parents in a poor knows thatafrica who left to their own devices heres a 50 chance after five years of schooling that child literacy and asic we can apply technology to improve their life chances. A couple you have lost of contracts in the u. S. S the u. S. Your biggest market but are you looking more at emerge being markets because no is where there is growth . John first of all, in america in the First Six Months of this were,3 on an ues underline basis that is the best in a few years. Our competitive performance in our Higher Education business in school rt of the business is very strong. We did lose a couple of in one relatively small part of the company but in connect competitive performance is strong. Merica is twothirds of our Business Today the single biggest Growth Opportunity is helping to make education much accessible and affordable and more effective for people in merica in the way i have described. But we do see big growth in china and brazil, in independent, across Subsaharan Africa and with the recent events over the these markets are challenged in many ways at the moment. They are finding the path to growth doesnt run evenly or in straight lines. Theres still a large growing middle class there who great aspirations for their children and themselves and for quality education, training is an incredibly important part of their future so we see big opportunities as well. Francine given what we have seen in the markets in china, haoerpblging markets and turmoil, are you worried about about a global recession . John clearly it is something global the c. E. O. Of a company you sort of worry about. F. T. And read the bloomberg to get the best view that i can. To focust is important on fundamentals in these times. A good example would be brazil. Hile the country is in recession and times are difficult particularly in the ublic sector, we have a Great Management Team there and they have done a good job of bringing pearsons different assets in a way we think will performance of the catch and allow us to grow the next few years. Challenges of the Public Sector facing in brazil you have a growing middle class wants better quality education for their children and themselves and they are willing it and we are able to help provide the products and services that fulfill that need. You price it read is education also recession proof . You have high unemployment then people my want to retrain . Certainly a good part of the story and opportunity and you look in america our highert 60 years education business is count enrollments go up rises. Ployment through the cycles there is a tend to growth but you see faster growth in the early years of a recession. As i think somebody you think said education is expensive try ignorance so i think there is a understanding that actually in times of economic difficulty nvesting in education is the best investment you can make and if you look at that, if you look u. K. Or u. S. Or china or brazil returns on education for individuals is greater now than history. Me in human francine one of the biggest shakeups in the media world the times and economists two brands pearson sold this year. Talk the break we acquisitions strategy and leadership. Ohn if we can find cquisitions that create opportunities we will take them. C. E. O. more from the of Pearson John Fallon when we return. Back. Ne welcome Publishing Group pearson will billion pounds from the economist and f. T. But the money . T do with john if we can find create value hat to shareholders and longterm sustainable opportunities as we will take them. But we dont need to hurry. And we need to rush will do that in context of other ways of achieving value and returning capital to shareholders. Francine do you worry about Currency Movement . We judge things at Constant Exchange rates. A u. K. Listed company so clearly probably the most rate ant exchange shareholders look at is the poun pounddollar exchange rate. I think over the cycle we and lookshareholders will just through that and clearly you someplace lakein brazil thats not a place in the urrent environment you are likely to deploy more capital. We will see how things emerge. Talked about investments. Inl you also sell your stake random house. Ohn it is performing exceptionally well. We own 47 of the business. Partner there re burtl everyone sman. Francine if they are interested. John i think we are at a point i said we have plenty of capital to deploy. They are performing well. E are still in the process of combining the two operations particularly areas lake distribution, finance and Technology Systems and the like. Year away robably a from achieving the peak synergies. Is something we look at and i wouldnt rule out i dont think you should think it pediatric priority. Francine so not 2015 and possibly not 2016 . 2015 and ainly not probably not 2016 either. Francine what will it take for to sell . Cide john we are very happy with the performance of the business. It is doing well. I think that the decision we based on a ould be view of what we saw the earnings potential and future growth of against realizing the apital and being able to redeploy it to improve our education business t. Is what is est likely to deliver the highest returns to our shareholder and grow the sustainably. Francine talk to me about john fallon the leader. He get for his i understand in pier ration. Look re somebody else you for inspiration . John one of the things that the cted me to pearson in first place my predecessor talked about the fact company has to have pump and the profits derive from doing something important and meaningful to society and well. It incredibly so, what is important to me and important to all 40,000 company you all have a leadership role to play a different way we have the opportunity to make the most important thing in the society we work nities that alongside health and basic human needs, education more available to more people around the world. In a purpose driven understand the profits derive from doing something important and doing it well. Fundamental. Francine this is a catch 22 comes from you rb, not the company. Mutually reinforcing thing. Because it is something i learn from colleagues around the world each and every day. What every member of the board would think is hugely company. T to the it is what matters to our customers. Happens to the parents and the communities in which we operate around the world. I think that since in holding yourself to that that is we talk about efficacy because they are all saying this make progress sopbtdz fantastic that you are day, are each and every you expanding accessibility . Teachers and g their students to be successful . And ultimate measure are you academic g that success into a better life and enhanced eer and prospects. That is the ultimate test. So, combining the sort of idea what you do ith each day is fundamental to the which comes as i say not just from me but every person that works for the company. Francine is there a personal paoelgs of advice that you were leader that you remember . John i think not taking seriously but always taking the work seriously. Important. T is. Think a sense of perspective and i think never losing sight why you urpose and exist. Because i think having that trying oral compass and to do the right thing for the right reasons is really important. On a personal note, probably the is from of advice i get my kids and colleagues on the be a basis which is try to ittle less grumpy and listen more effectively. Francine where do you see yourself in five years . Less grumpy . John it is where i see pearson what e years time is matters and i think theres an opportunity for us as a Company Something really important and to funnel fill that potential. O i think the ultimate measure of where pearson is in five ears time are we helping more people around the world both from the poorest members of emerging rough to the middle class to the wealthiest in omies in the world here the u. K. And america. Are we helping more people to the promise of education into the reality of a better life. We do that, then we will deliver great value to or shareholders to 10 years five just as i believe we have over the last decade. Fallon, thank you for joining us. John thank you. He calls himself the country but from tennessee. Dish Network Founder charlie ergen. Give a lot to talk about. For the first time on bloomberg television, he weighs in on the Seismic Shift taking place in television. Big plan to become the next Wireless Company and why he might be looking to merge with this guy. The pink shirt wearing john ledger. They have done a fantastic job. But, the famously tough boss is in questions but his management style. , if youre not used to that youre not comfortable