Germany's Axel Springer joins American publishers association
The News Media Alliance has landed a very big fish as a new member — powerhouse German publishing giant Axel Springer.
Axel Springer becomes the first international member of the Alliance, formerly the Newspaper Association of America. It will also be the largest member as measured by revenue — roughly double the size of the New York Times Co. and larger than Gannett.
Axel Springer publishes Bild and Dee Welt and has been a leader in digital transformation, now getting 70 percent of revenue from digital editions and digital marketing ventures. In recent years, Axel Springer has expanded into the U.S. with several acquisitions, notably Business Insider, and also has partnered with Politico for its expansion into Europe.
The News Media Alliance has established a priority of trying to negotiate fair compensation from Facebook and Google for original content displayed on the two platforms. Axel Springer has been particularly aggressive in battling the so-called duopoly in Europe, where various forms of government regulation are in place and new ones being tried.
When I asked for a comment from Axel Springer, this reply from spokesperson Bianca-Maria Dibold alluded to the issue without slamming the two companies:
"The reason for us joining News Media Alliance is simple. Publishers worldwide are facing very similar challenges. Therefore, it makes perfect sense to join forces. Our strategy, working together with the big tech platforms, is to find ways building a healthy ecosystem which will be to the benefit of all parties."
David Chavern, CEO and president of the Alliance, said that several of his board members who had worked with the company in the international WAN-IFRA publishing group were "really impressed with them."
So Chavern figured it was worth a trip to Berlin to talk with top Axel Springer executives and try to bring them on board. Besides pooling efforts on the Google/Facebook question, Chavern said, Axel Springer and the alliance will revisit collective copyright management — something that has been tried a few times previously in the United States without much success.
When the NAA changed its name 15 months ago, it simultaneously got rid of "newspaper" with its legacy connotations and began inviting digital-only operations to become members. Only a few have to date.
But Chavern said that removing "of America" was strategic too. "There is a convergence of issues now, " he said. "The future of the digital news business is going to be one without borders."
I asked if other European publishers with large digital U,S. interests — like The Guardian or Financial Times — might follow Axel Springer's lead. "I hope so," Chavern said.
Lobbying work continues on the Alliance's effort to get Congress to waive anti-trust objections to letting its members negotiate fair compensation from Facebook and Google. Other bigger challenges like health care and tax changes have prevented any serious consideration this year, but Chavern said that 2018 looks better.
Among Axel Springer's business achievements has been growing revenue roughly 7 percent so far this year and operating at a healthy 10 percent net profit margin. If a little of that rubs off, it would be an extra benefit to U.S. news organizations, struggling with deep print ad revenue losses and the continuing challenges of digital transformation.