AXEL SPRINGER SE
“In 2019, we want to invest in growth to achieve a long-term increase in value,” CEO Mathias Doepfner said in a statement coinciding with the release of Axel Springer’s 2018 annual report. The financial report warned that stock prices would sink to a two-year low, but Doepfner stressed the publishing giant would invest in digital transformation rather than profits. Springer is also partnering with the second-largest stock exchange in Germany to launch a blockchain-powered trading service. This dedication to digital transformation highlights the company’s strong position in the digital space and willingness to adapt early. As early as 2006, Axel Springer was investing in late-stage digital companies that often had no direct relationship to publishing. It was determined to learn as much as possible about technology and then apply the knowledge to its own brand. The year before, TechCrunch gawked at why “Axel Springer is investing in Magic Leap for some reason” — an AI company whose headsets could be part of the future of consuming news content. What does this move reveal about Axel Springer’s entrepreneurial leadership and culture? What lessons could other companies apply from its strategy?
Read more about Axel Springer’s history in the timeline below.
Timeline
1940s-1950s
Publisher Hinrich Springer and his son, Axel, establish Axel Springer Verlag with a nominal capital of 200,000 Reichsmarks (approximately $887). After the West German currency reform in 1948, the company introduces six new publications and acquires a majority holding in a book publishing business. The publishing house, located in Hamburg, becomes synonymous with the West German “economic miracle.”
1950s-1960s
Axel Springer becomes a leading champion of German reunification and opens a headquarters in Berlin. The company acquires a majority holding in Ullstein AG, which includes two Berlin newspapers and a book-publishing business. By 1964, Axel Springer’s control of market share of daily newspapers, Sunday papers, magazines for young people, and radio and TV listings in Germany reaches 40, 80, 45 and 48%, respectively.
1970
Axel Springer becomes a joint-stock company.
1972
Axel Springer is targeted as a symbol of a free West Germany and its Hamburg headquarters is bombed.
1976
The company establishes Cora Verlag, a publisher of novels, and broadens its reach to include magazines for women, sports, photography and international art publications.
1985
Axel Springer, the company, goes public, but publisher Axel Springer dies in Berlin at age 73. The CEO transitions the company’s responsibilities to several existing supervisory board members and Axel Springer’s fifth wife, who was never active in the operating management but is a member of the supervisory board.
1988
After German reunification, Axel Springer acquires former East-German publications and becomes Germany’s first publisher to provide a teletext service. It also launches its first foreign companies with the magazine publishing house Axel Springer-Budapest GmbH and takes over the Spanish magazine publishing house SARPE.
1989
The company acquires a holding stake in local newspapers Harburger Anzeigen und Nachrichten and Tiroler Tageszeitung.
1994
Axel Springer acquires majority holding in Finanzen publishing group.
1995
The publisher’s department “interactive media” is set up on the basis of the videotext editorial departments. It is later changed into the online-provider Interactive Media CCSP AG, which is sold in 2003 to T-Online International.
1998
Axel Springer purchases Spanish newspaper publisher Hobby Press and the publishing company Econ & List.
1999
The company acquires TV production company Schwartzkopff and a majority holding in the Swiss publishing group, HandelsZeitung. The company also establishes Metropol Film-und Fernsehgesellschaft in Berlin as a joint-venture with Studio Hamburg.
2000
Axel Springer establishes a group of TV companies, in which Axel Springer Verlag has a 11.5% share.
2001
Axel Springer launches a general-interest portal, BILT-t-Online.de
2002
(Retrieved from Axel Springer)
Mathias Dopfner, former head of the newspapers division of Axel Springer and editor in chief of Die Welt, becomes CEO at age 39.
2003
Axel Springer sells its book group to Random House and changes its name to Axel Springer AG. The company introduces a daily tabloid, Fakt, in Poland, as well as a monthly women’s magazine, Jolie. Axel Springer AG introduces Audio Video Foto BILD.
2004
Axel Springer purchases a stake in Hamburg 1 and launches Axel Springer TV Digital in Germany, and Forbes magazine and Russkij Newsweek in Russia. The company enters the Chinese market with an affiliate in Shanghai.
2006
Germany’s antitrust body blocks Axel Springer’s attempt to acquire Germany’s biggest television broadcaster ProSiebenSat.1, which prompts Dopfner to reconsider Axel Springer’s digital strategy. The company begins a new strategy of focusing first on organic growth and late-stage digital acquisitions, which aims to infuse digitization into Axel Springer’s corporate culture. Dopfner challenges the company to generate half of its revenue and profit from digital products within the next 10 years; as of 2006, less than 1% of the company’s revenue comes from digital products.
2008
Axel Springer sells its indirect interest in ProSieben to a co-shareholder. Axel Springer enters into an agreement to collaborate toward the introduction of a new type of offering worldwide in the personal TV segment. The company establishes the ITAS Media Company, with its head office in New Delhi, India. Axel Springer acquires a 10% stake in Dogan Yayin Holding.
2009
Axel Springer purchases 19.3% of the shares in international job portal StepStone and acquires an additional 45 million shares of StepStone, increasing total stake to 87.8%. Digital media constituted 21.2% of the company’s total revenue.
2010
Axel Springer sells the ‘Solutions’ business of its subsidiary and 50% of its Hamburg-based publisher. The company establishes a new joint-venture partner, Harlequin Enterprises, and a new joint-media company, Ringier Axel Springer Media. Axel Springer acquires 72.6% equity interest in Sohomint, an operator of themed content portals on the internet.
2011
One of Axel Springer’s first digital solutions, iKiosk – a distribution platform for full newspaper and magazine editions - is released.
2012
Axel Springer reaches an agreement with Airbnb on a strategic marketing partnership in Germany for establishing a website. The company establishes a strategic partnership for growth in digital classifieds business with General Atlantic. The company signs an agreement to acquire 100% of equity in allesklar.com, which is expected to help the company grow in the online classifieds business.
2013
Dopfner declares that the company is aiming to become “the leading digital publisher.” The company launches BILD plus, which creates a subscription to the BILD brand. Axel Springer sells regional newspapers, woman’s magazines and television magazines to Funke Mediengruppe for 920 million Euros.
2014
Axel Springer joins forces to launch a European edition of POLITICO and invests $20 million in OZY, an online news and culture magazine.
2015
Axel Springer invests $25 million in Business Insider and introduces “Leading European Newspaper Alliance,” which is meant to spur content collaboration between Spain, Italy, France Belgium and Switzerland. Axel Springer enters into a strategic partnership with Samsung for development of new digital media services for European consumers. The company partners with Viacom to introduce a new TV and video ad sales joint-venture in the German market.
Axel Springer introduces UPDAY, a news content platform that will be pre-installed in Galaxy Devices for customers in France, Germany, Poland and the UK. Records revenues of $3.66 billion during FY2015, an increase of 8.5% over FY2014. The operating profit increases 96.2% over 2014 and net profit decreases 68.4%. Digital media constitutes 61.7% of the company’s total revenue.
2016
Axel Springer expands its U.S. presence with establishment of a headquarters in New York. The company acquires 93% stake in eMarketer for $242 million to strengthen its position in business-related news and content in the American market. Axel Springer launches MarketInsider.com, a globally focused markets-data and news operation.
2017
(Retrieved from The Guardian)
Axel Springer launches Germany’s first daily sports newspaper, Fussball Bild, in hopes of offsetting declining sales of other print products. The company buys a minimal stake in Uber, along the lines of its 2012 agreement with Airbnb.
In November, Axel Springer makes another $40 million round of funding for Group Nine Media. The digital company targets 18- to 34-year-olds, with brands including The Dodo, NowThis, Thrillist and Seeker of Discovery Communications, Inc.
In December, Business Insider announces a name change to Insider, Inc. The adjustment is driven by the company’s interest in branching out from business news to more niche categories like Insider Coffee and Insider Wine. While BI has yet to turn a profit, the Axel Springer property expects a revenue jump of 40%.
2018
Tanit Koch, the first female editor-in-chief of German newspaper BILD, quits. Her relationship soured with Axel Springer’s digital chief Julian Reichelt.
In February, Axel Springer announces a round of funding for Magic Leap, a mixed-reality eyewear company that could transform how content is consumed.
Axel Springer posts a double-digit gain in Q1 core profits. The EBITDA for its digital portfolio rises by 16.3%, which is in line with industry estimates. Four-fifths of the company’s core profits come from digital.
2019
In March, Axel Springer announces its annual report, which presents a subdued outlook and sends stocks spiraling to a two-year low.
Following the release of its annual report, Axel Springer announces a partnership with Börse Stuttgart, Germany’s second-largest stock exchange, to launch a blockchain-powered trading venture. Axel Springer and its subsidiary Finanzen.net will control 30% of the new firm, which will be based in Stuttgart with an office in Berlin.
Axel Springer also set its sights on eBay Classifieds, which the media giant hopes to acquire.
Want to know more about how Axel Springer’s entrepreneurial leadership has helped to transform the media giant from publisher to digital innovator despite facing skepticism and a rapidly changing industry? Refer to pgs. 179-191 in The Strategic Digital Media Entrepreneur to learn more.
Sources for Axel Springer Timeline:
https://www.theverge.com/2017/4/19/15360180/uber-axel-springer-stake-investment
http://www.axelspringer.de/en/presse/Axel-Springer-invests-in-Magic-Leap_31760395.html
https://cointelegraph.com/news/borse-stuttgart-axel-springer-to-jointly-launch-crypto-trading-venue
http://fortune.com/2019/03/21/ebay-classifieds-axel-springer/