BPN 1609: One Dutch freesheet in the future

Last week the Telegraaf Media Group (TMG) announced the acquisition the freesheet Metro. TMG  already owns the freesheet, Sp!ts, since the launch of Metro in The Netherlands on June 21, 1999. TMG claims to keep both freesheets alive.

Why Metro was sold
Metro Holland had a turn-over in 2011 of 23.4mln euro. Its EBIT in 2011 was 451,000 euro (2%), a sharp decline as in 2010 Metro Holland still recorded an EBIT of 3.6mln euro (15%). The present goodwill of the brand is 3.6mln. This decline is due to the dip in the advertisements, which is being felt by all Dutch newspapers, paid or free. Besides the freesheet market has reached its saturation in The Netherlands.
Another reason for selling off the Dutch Metro is the strategy by Metro worldwide to sell off in the European titles and invest in Latin America, where the freesheet market is still growing. Editions have been launched in Guatemala, in Peru, Colombia, Mexico, Brazil, while an  edition in Argentina is being planned.

Is TMG allowed to buy the Dutch Metro

The Dutch Netherlands Competition Authority (NMa) has not yet been asked to look at the acquisition. It looks like the TMG did its homework. If both companies have a turn-over of more than  30 mln euro, the companies should inform the NMa. Both companies should have more than 113.450.000 euro in turn overs, before they are obliged to inform the NMa. The turn-over of the Dutch Metro had only been 23,4mln euro in 2011, so the NMa does not need to be informed so far, unless the turn-over of 2012 is dramatically higher.

Two freesheet titles in one company
There are few newspaper publishing companies in The Netherlands who liked to acquire a freesheet. The Belgian/Dutch Pressgroup already indicated not to be interested in freesheets. They had their try in 2008 with the launch of De Dag. Wegener terminated the freesheet De Pers in March of this year after failing to get sufficient advertisement volume. So why should TMG acquire  the Dutch Metro and keep both titles alive?
TMG immediately stated, that Metro would stay as an independent title. In fact one of the TMG managers stated that the differences between Metro and Sp!ts would increase. The advantages of the acquisition would be in the common printing, distribution and sales of advertisement.  And as TMG is the only one in the freesheet market, it can up the prices of the advertisements, the management stated.

Just a question of time

The arguments by TMG to acquire Metro sound reasonable, but are just cosmetic. If TMG wanted to create a difference between its own freesheet Sp!ts and another freesheet, it should have acquired De Pers; it probably would have been cheaper than Metro. Sp!ts is a throwaway freesheet, while De Pers had content. Now TMG has two throwaway freesheets, of which Sp!ts is the stronger brand. It will just be a question of time that TMG will kill one of the freesheets as both will go for the same advertisements and the editorial content will hardly differ.

IMHO, before 2015, Metro will be killed off and Sp!ts will survive as the only Dutch freesheet as there are not enough advertisements budgets with the ad companies and not enough budget for two editorial staffs of throwaway freesheets.

BPN 1582 Closing my Hyves account

Today I closed my Dutch Hyves social network account. And today Vinton Cerf warns for walled gardens in the Guardian.

In 2007,  I had a long discussion with Xenia Maren Menzies (hi Xenia, do you remember) about the durability of FB. I told her to have an exit strategy in case FB would go bankrupt or in case you had enough of it or, in the worst case, you would die. Who would close the account, was the question. And now social networks are working on their own way to extinction. And that strategy is called: walled garden.

The term walled garden was often used in connection with AOL around 2000. AOL had started out as a consumer online organisation and had survived consumer services like The Source, Trintex and Delphi. By 2000 AOL had a strategy of keeping consumers in their garden. So they started to cooperate with all kind of news and game companies with the slogan: we are your one-stop shop. The social networks go into the same direction now. BUT I DO NOT WANT A ONE WAY SHOP.

So start reading the Guardian article Google evangelist warns Facebook could be the next AOL or IBM. The Google evangelist is Vinton Cerf who says Facebook's closed model risks it becoming a 'walled garden' unconnected from other networks and websites. On my FB page this link was offered by Professor Melissa Lee Price and also linked by Gyorgyi Retfalvi.

The article appears on the day that I have closed my Hyves social media page. Hyves is a Dutch social network, which is presently belonging to De Telegraaf. This newspaper publishing company bought the social network, when it was really over its commercial top. And presently it is panting and trying to catch up with other networks. Today Hyves launched a major overhaul, which prompted me to look at Hyves in general and to the persons profiles I link to. Then I compared the two networks and the list of profiles and noticed that I could find the profiles also on FB. So what was the extra on Hyves: a walled garden of a newspaper company? I decided that it was time to close my Hyves account and I did. I must compliment Hyves on this clean closing-off procedure.

BPN 1582

BPN 1146 The last days of Planet.nl

One of the oldest ISPs in the Netherlands Planet Internet will be phasing out this month and be transformed into KPN Vandaag (Today). The exercise is part of a rebranding strategy of the telecom company KPN. The make-over has been prepared since the beginning of the year and will be definite by August. Technically nothing changes for the Planet subscriber as he/she will maintain the same e-mail address and can use the same access code as well as password.

KPN has been working on its brand strategy.This has lead to the merging of services and brands. Brands as Tiscali and Speedlinq merged into the low-end market brand Telfort. Now Planet and KPN ADSL will merge into KPN Vandaag. So far the telephony brands Simyo, Hi and Ay Yildiz will continue in the market. Also the ISP XS4ALL will remain independent; merging this ISP would create havock, as the ISP has been one of the best, most progressive and the most independent Dutch ISPs.

Planet Internet was one of the first consumer ISPs, but it distinguished itself right from the beginning. The existing services such as Nlnet, XS4ALL, Knoware and Euronet*Internet offered all access to the Internet highway, but did not provide the users with maps. A complete new approach came from Michiel Frackers (see phtograph on the cover of hi book In search for the Holy Grail), a a graduate in communication science. Together with some other students he developed a business plan, which was refined by Maarten van de Biggelaar, the managing director of the publishing company Quote, where Frackers had been an intern.
The service should become a consumer service or even better an online publishing company. The service was new as it offered content, online access and marketing. In other words, consumers would get road maps, passed on by a editorial staff, consisting of cybrarians (a term coined in 1993 by Michel Bauwens, an former BP information manager in Antwerp). Journalists of the first hour were Francisco van Jole and Peter Olsthoorn. Another partner in the venture was KPN, which provide money and telecom facilities. The marketing knowledge came from the magazine publisher Quote and newspaper publisher De Telegraaf. This led to a first month free starter pack in bookshops and newspaper booths.

The service became operational on June 20, 1995. A subscription for six hours was 26,95 Dutch guilders (roughly 13,50 euro) with every additional hour 4,95 Dutch guilder. By October 1995 a country wide telecom network was realised and the service had picked up already more than 14.000 subscribers and was the largest Dutch ISP. On January 1997 Planet Internet merged with World Access into World Access/Planet Internet, starting the consolidation phase and a spade of Internet illerate managers. The publishers Quote and De Telegraaf left as ashareholders as well as many of the employees of the first hour, among which the founder Michiel Frackers.

By 1999 the name was shortened to Planet Internet. The service had 300.000 paying subscribers and by 2002 the number rose to 665.000. They yer 2002 was a year for plans: cooperative projects such as Planet Travel and Planet Money. There were also expansion plans to Great Britain, Germany and Belgium. But all these plans failed.

Over the years Planet Internet lost in importance. The quality of the news service went down, while other better news service were started up. The traffic went down. In 2005 Planet.nl attracted 57 million visitors monthly, while two years later the number went down to 19 million monthly. But the traffic number recoverd a little bit by January 2008 with 22 million visitors.

With the make-over of the branding the names Planet Internet and Planet.nl will be ready for the weblog museum. The service will be remembered for its initial excellence in online journalism.

Blog Posting Number: 1146

Tags: online journalism

BPN 1138 From txt to vids

One of the last speakers at the MPJC 2008, was Marianne Zwagerman of the Dutch media company Telegraaf Media Group with its flagship, the daily newspaper De Telegraaf. She told the story of how a newspaper company was changing into a media company, crossing from traditional media to a hybrid paper/digital media company. It is one of those company stories of conversion from a traditional medium into a digital medium in search for a digital product portfolio, while making money on the traditional media. De Telegraaf is not a small media company, so it is like changing the course a mid range tanker in a small (language) channel. And it is not just simple to say: from analogue to digital, from paper to bits and bytes, from texts and pictures to sound and video.

D Telegraaf Holding has a vast range of traditional publications: 100+ newspaper titles, 4 radio stations, 100+ puzzles and game titles, 12 magazine titles, 20 events. De Telegraaf was an early bird in the field of digital media; yet the turn-over of the digital media is less than 15 per cent of the 800 million euro turn over of the company. Besides these activities De Telegraaf Holding has a substantial share in SBS television company.

While the traditional media still bring in money, the digital media are working their way up. The activities are brought together in a digital division, which has a turn-over target of 15 per cent this year. De Telegraaf has been on internet for 12 years now. In the meantime the digital range has broadened from a simple extension from the printed newspaper to a pdf version to a special classified ads site, Speurders. But the company has also extended to narrowcasting and its subsidiary LibriumTV takes for example care of the McDonald network, the underground stations, Total gaz stations, buses of a particular company and shopping malls. The advantage for De Telegraaf in this activity is the combination of news and advertisement. .

Reigning the digital department is video in general and mobile video in particular. With the narrowcasting (or out-of-home TV) activities, De Telegraaf got into the video business. Now it operates Dumpert, the Dutch YouTube, but under editorial supervision. Dumpert has 550 uploads a month, 2,5 million visitors and 100 million watched videos.

But De Telegraaf also invested in the shockblog Geenstijl.nl and Geenstijl.tv. The reasoning behind this investment is curious. The newspaper De Telegraaf has always set the tone in the public discussion in The Netherlands. With Geenstijl.nl De Telegraaf shapes the talk of the day, showing that we know what make people tick.

For De Telegraaf there are three principles on their road from text and pics to sound and vids: branded media, hybrid business models and journalistic independence.

Blog Posting Number: 1137

Tags: newspaper, narrowcasting

Free newspapers less appreciated

I knew it from my gut feeling: for-free newspapers loose from the paid-for newspapers. Market research from Newcom Research & Consultancy BV confirmed that paid-for newspapers get on average 7.9 points out of 10; for-free newspapers get an average of 6.6 out of 10. The survey is interesting as two more free newspapers started this year in the Netherlands. And my second gut feeling was also right: the most recently launched for-free newspaper DAG by the newspaper holding PCM and the incumbent telco KPN scores the lowest in appreciation.

In the Netherlands we have four national free newspapers: Metro, Spits, De Pers and DAG. Metro was the first one, set up by the international Metro chain in cooperation with the Dutch railway company NS since 1999. This publication was immediately followed by Spits, a publication from De Telegraaf, which was out to protect its advertisement share. On January 23 of this year a new free broadsheet was published, De Pers, to be followed by DAG on May 8. The survey publishes the first competitive figures in appreciation.

Metro and Spits score highly in the survey, respectively 6.9 and 6.8. But De Pers is the winner with 7.0. DAG is the absolute looser with 5.9. A discussion can be started about the fact that Metro and Spits are established for-free newspapers. But De Pers proves that it is appreciated even better than the long existing for-free newspapers. De Pers is seen as a newspaper with depth, while Metro and Spits are bullet news newspapers, aiming at young people as a target group. DAG is still trying to find its target group and format. So far it has proven to be publication with an aggressive lay-out, a lot of pictures and not much depth.

The appreciation is also partly related to recognition of the title and the penetration. Metro and Spits are well-known and well established. Their distribution is an oiled machine and the audience is mainly reached around the train and bus stations. De Pers and DAG still have difficulties with the distribution. De Pers is difficult to come by, while DAG made a smart distribution deal with a grocery retail chain. But both newspapers still have to do more before people recognise the title.

The conclusion is that Metro and Spits are well established in the market, but have gotten competition from De Pers as to its format and content. With a better distribution plan, De Pers could succeed Metro and Spits, but also challenge paid-for newspapers. DAG will have to make up a lot if it ever wants to be an established for-free newspaper; it will have to change its format radically to attract a target group (and advertisements) and survive. It is unbelievable that a newspaper holding as PCM with so much knowledge about newspapers, an experienced advertisement acquisition machine and a distribution network is putting out such a rag and all this with bragging adjectives as cross-media. PCM would have done better to make a joint venture with De Pers, which had no editorial experience, no ad acquisition machine and no experience in distribution.

But the survey shows another fact. For-free newspapers are less appreciated than paid-for newspapers. This looks like a contradiction. While the paid-for newspapers are going down in circulation figures, there is a great distance between the appreciation for the paid-for newspapers and the for-free newspapers. Paid-for newspapers get on average 7.9 points out of 10; for-free newspapers get an average of 6.6 out of 10.

And the opinion about paid-for newspapers is strong. Almost 70 percent of the respondents are of the opinion that for-free newspapers do not change anything for the appreciation of paid-for newspapers. Confronted with the statement: For-free newspapers are a full replacement for the paid-for newspapers, no less than 48 percent of the respondents disagree; 28 percent disagree, while 20 percent are neutral. Almost 45 percent of the Dutch indicate that they would not miss for-free newspapers as they would cease publication. I personally think that this statement is a nonsense statement as hordes accept for-free newspapers every day.

Blog Posting Number: 811

Tags: newspapers, cross-media

French daily Les Echos offers two e-readers

The French daily newspaper Les Echos offers their subscribers a daily electronic newspaper, news items from the French news wire agency AFP and a series of electronic books by the publishers Nathan, M21, Pearson Education. Remarkable is the fact that the newspaper offers this electronic newspaper and the goodies either as an electronic package or as an electronic package with a choice out of two e-readers (iLiad or STAReBOOK).

iLiad
The French financial daily Les Echos has a commercial offer for the reader in combination with a one year subscription to the newspaper. Users can upload an updated version of the newspaper several times a day through a wifi connection. Subscribers of Les Echos can now register for an iLiad subscription on the website of the French financial daily. For 769,00 euro (including VAT) the subscriber receives an iLiad e-reader, a one year subscription to Les Echos, to a selection of the French news wire AFP and to a selection of e-books provided by the publishers Nathan, M21, Pearson Education. It also contains Stylet for writing notes and accepts Mobipocket formatted e-books. Les Echos needs 5 to 8 weeks to deliver the iLiad.

Les Echos looks like the first commercial deal with a newspaper. The iLiad has been experimented with in Belgium with 200 subscribers to the financial daily De Tijd. But there is no concrete proposal from the management yet; a decision is expected by September. Last year cooperation was announced by the manufacturer iRex Technologies with the Yantai Daily Media Group in China. The group would use Iliads to distribute its papers electronically; the newspaper group distributes 1 million printed newspapers daily. Recently iRex Technologies announced that the Dutch newspapers NRC Handelsblad, Het Financieele Dagblad and De Telegraaf will research the e-Reader opportunities.

Not betting on one horse
Les Echos is not betting on one horse. The newspaper offers in fact another e-reader besides the iLiad: STAReBOOK. The offer is 649 euro (incl. VAT) and quite similar to the iLiad offer. So a subscriber will receive the e-reader, a selection of news from the French news wire AFP and to a selection of e-books provided by the publishers Nathan, M21, Pearson Education and MP3. There is no Wifi facility onboard.
For a comparison between the iLiad and STAeBOOK go to YouTube.

BTW My cracked iLiad (see the photograph; mark the ghost!) is now in Germany for repair. It was picked up last Friday for transport from The Netherlands to Germany. I hope that the iLiad can be repaired so that I can move on with the experiments such as blogs collections and technical manuals on the iLiad.

Blog Posting Number: 769

Tags: iliad, digital paper, e-book, e-book reader

iLiad: forthcoming research on Dutch newspapers

It has been in the air ever since the iLiad was under construction by the Philips spin-off iRex Technologies: Dutch language newspapers on e-Readers. This week the Dutch Press Fund awarded a consortium of Dutch newspapers a grant of maximally of 362.950 euro for practical research into e-Readers. Three newspapers will partake in the research: the free newspaper Spits, the financial daily Het Financieele Dagblad and the national daily de Volkskrant. The research will take two years and the results will be offered to the newspaper sector.

The practical research will not be directed towards the technology, but will focus on how e-Readers can assist the change-over from the classic, static newspaper to the digital, dynamic newspaper content.

This research objective is broad. Yet one can ask whether another research has to be started up. Internationally there is an IFRA eNews research project going on. Closer to home, Wegener and Philips have done research into the usage of e-Readers by regional newspaper readers. The use of the e-Reader was tested over against other information devices. Especially the difference in usage between internet services and e-readers was tested. Very extensive research was performed with the Belgian newspaper De Tijd. This newspaper is a Flemish financial newspaper. I reported on the results of the research project extensively in my postings. But so far there is no decision has been made public that De Tijd will continue will the service.

The research in The Netherlands will be interesting as Het Financieele Dagblad will be the Dutch language partner in it. So it will be possible to compare the results between De Tijd and Het Financieele Dagblad as language and subject are the same.

New for the Dutch/Flemish language will be the research into the free daily and the paid national newspaper. De Spits is the counterpart by de Telegraaf of the Metro. It aims at the young commuters in urban areas. For de Telegraaf the newspaper the newspaper is an ad vehicle. The national newspaper de Volkskrant direct itself towards young audience with a good education and good job; a substantial part of the audience consists of singles.

The interesting part of the research will be the comparison between professional usage, usage for paid news and usage for free news. From my experience with the introduction of new devices such as CD-ROM players and electronic books, I expect that professional usage will be the leader of the three.

Interesting will also be the content question. Will the newspaper editorial staffs just transmit the newspaper as the pdf files on internet once a day or will they provide an iLiad edition once a day, in a day parting mood (morning, midday, late afternoon editions) or continuously changing news. From the internet experience it is clear that pdf is not a favourite type of edition and that continuously changing news is much appreciated. Given the wireless facility of the iLiad e-Reader a continuously changing news feed can be transmitted.

Personally I would also include the Readius in the project. The two e-Readers could be tested over against each other. The iLiad would be a single functional information device with an A5 screen, while the Readius would be a multi-functional communication and information device with a mobile telephone and a small screen, dedicated to information.

I look forwards to participating in tests of this research project. Of course I should get my iLiad to the repair service first.

Blog Posting Number: 732

Tags: iLiad, e-Reader, electronic book, digital paper, electronic newspaper

Never a dull moment at PCM

There is news again from PCM; but solid news this time. The Dutch newspaper and book publishing company has a new chairman of the board of directors. After all, but one of the board members have left, Mr Rob Bonnier has been appointed as the chairman, be it ad-interim.

The Foundation Democracy and Media, the major shareholder in the company, has appointed Bonnier, installing, at last, an experienced director. He finds Mr Caspar Broeksma, next to him as an ad-interim director.

Mr Bonnier has a lot of experience in the governance and management of stock quoted companies. He was the cfo of the paper company KNP BT from 1983 till 1997. Presently he is the chairman of the board of directors of DSB Bank and has some other directorships.

What is the governance and management state they find PCM in? The Foundation of Democracy and Media, after Apax’s exit, again the major shareholder of the company, needs shaping up with strong governors. The board of directors needs another two directors, as the old board has left, except for Mr Strengers. The daily management needs at least a new CEO, as now only Mr Bert Groenewegen, the financial man, is in function and is the last informed link to the company.

What do they find on their plate? Besides solving the immediate management situation, they will have to look into the merger talks that have been going on with the Foundation of Democracy and Media and the NDC/VBK, the Northern regional newspaper and national book publisher, since the beginning of the year. So far the CEO of NDC/VBK, Mr Jan Roos, has been tipped as the new chairman of the board of directors of the merger company PCM – NDC/VBK (my god what a name!).

On the other hand Mr Bonnier and Broeksma will find another problem on their plate. They will have to deal with the MNa, the Dutch monopoly watchdog. Their merger is going to be a major media concentration in Dutch newspaper world as well as in the book publishing world. MNa will have to consider the situation that after a merger there will be three major newspaper publishers: De Telegraaf, Royal Wegener and the PCM – NDC/VBK combination. De Telegraaf, a national newspaper company, wants to expand in broadcasting through its SBS link. Royal Wegener, a regional newspaper company, is being courted by the Europe oriented newspaper company MECOM. And the new combination has national and regional newspapers and will be dominant in book publishing. NMa might approve the merger, but with many condition.

So besides strengthening the governance structure of PCM, new daily management, most likely ad-interim, is needed immediately, while the new board members steer their merger plans passed the NMa. After a wild period at PCM, a new period might follow in which a solid strategic course for company can be set out in silence.

Blog Posting Number: 728

Tag: newspapers

Wegener on its road to foreign management

Last week I had the pleasure to see a forecast partly fulfilled. In 1995 I wrote in the Dutch publication Telecombrief Magazine, that the regional newspaper company Royal Wegener would be acquired by a foreign publisher within 10 years. At that time I supposed that it would be a German newspaper publisher as the circulation area of Wegener boarders with Germany. There was a lot wrong with the forecast. The foreign publishers missed my deadline already for two years. And the participating publisher is not German, but British. But the basic forecast still stands: not for long Wegener will be acquired by a foreign publisher.

Last week David Montgomery's British Mecom Group picked up a 24 percent minority share in Wegener. This had been in the air since a year, when Mecom took over the Limburg Dagblad. The minority share package was in the ownership of newspaper company Telegraaf Media Group. But as this company was not allowed to expand its influence in the newspaper sector, it put the shares in the safe and waited for an offer. Now that De Telegraaf has cashed, the company can invest the money in television and digital media.

Mecom will deploy 108 million GBP for a 24 per cent stake in the Dutch publisher Wegener, which has about 20 per cent of Holland's newspaper market. Mecom and the publicly-listed Wegener will now enter into talks, with Mecom seen as a likely candidate to make an offer for the entire company.

In April 2006 Mecom won the bid for The Media Groep Limburg B.V., Grafisch Bedrijf Media Groep Limburg B.V. and De Trompetter B.V. (freesheets) and paid 200 million euro. The high price was seen as part of a strategic investment. And so it turned out. Now Mecom is after Wegener, which has seven daily paid-for newspapers in the central part of the Netherlands, including De Gelderlander, a title with a daily circulation of 154,000 copies. It is expected that Mecom will need to pay an estimated 550 million euro in order to get the other 76 percent of the shares. If the British company succeeds, the acquisition will shake up the newspaper scene in The Netherlands.

And there was more news from Wegener. Han van den Berg, manager strategy with Wegener, said: Wegener has money for multimedia. Wegener has invested in digital media since 1995, doing foolish investments and some daring ones. In the pioneer years of Internet Wegener started a joint venture with a broadcast company; within half a year this was broken up with a big fight remaining as there was no written agreement from the start. Then came the project City Online, a Web 2.0 project avant la letter with local portals; but the project failed due to a heavy 3D-environment and other technical and ethical problems. Besides the editors-in chief of the regional newspapers wanted to have more influence.

But presently Wegener has built up its digital media around its own newspapers (the digital commons and regional portals) and it has started digital expansions of its classified ads such as Jobtrack and Autotrack. It has also collaborating with the Yellow Directory service iLocal. And the company has taken a 37 percent minority share in the beleaguered housing site Funda.
Wegener presently earns 2 percent in digital media of its total amount of 650 million euro in revenues. Major money maker in digital media is Funda. The other activities do not really contribute yet. The company wants to push its 49 percent joint venture with iLocal.

It is only a matter of time that Wegener will fall into foreign hands.

Blog Posting Number:690

Tags: newspapers