German media corporation Axel Springer’s Q2 results show slightly less year-on-year revenue, though its profits were larger than anticipated. The company has attributed the results to higher expenses as it transitions away from its traditional print media focus to become a digital media platform – with growth in digital media making up for decreasing print revenues.
Less than two weeks ago, Axel Springer sold its regional newspapers Berliner Morgenpost and Hamburger Abendblatt, along with five TV programme guides and two women’s magazines to Funke MedienGruppe for €920m in a bid to build up its digital offerings. Digital media now accounts for roughly 40 per cent of the company’s revenues, which came in at a total of €171.6m before taxes, interest, depreciation and amortisation (Ebita).
Axel Springer CEO Mathias Döpfner took the time to address the public concerns over the recent sales in a press statement on the Q2 results, saying: “I understand the fears this step caused among some fellow journalists. But I am very sure that we have thereby contributed more to securing the future of journalism as have those who lament the end of publishing so loudly these days.”
In the first quarter of this year, Axel Springer announced its digital revenues overtook print for the first time. Axel Springer has a number of online businesses in its portfolio, including real estate portal Immonet, price comparison site idealo and mobile coupons startup kaufDA.
[contentad keyword= “left”] Offsetting the newspapers’ lower circulation rates are the increased online advertising revenues. A large factor influencing the increasing digital revenues was the introduction of paid content models on a number of Axel Springer newspapers’ online portals. Die Welt now has more than 47,000 paying subscribers, while tabloid newspaper Bild now offers Bildplus for its customers.
The corporation made no mention of a highly speculated takeover of Deutsche Telekom-owned online classified advertising portal Scout24 – rumours have it Axel Springer sold its publications to free up capital and takeover the portal, which is currently being auctioned. The Scout Group is apparently valued at €1.5b.
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