The Newspaper Industry in a State of Flux

Abstract

It is June 1995, and while most of newspaper management in the Netherlands is enjoying its summer holidays, Reed-Elsevier, the multinational corporate parent of Dagbladunie, a newspaper publisher in the Netherlands, puts its newspaper subsidiary for sale. The announcement rudely awakens the industry and months of turmoil are ahead. Despite the impressive profit margin of well above 10 percent pre-taxes, Reed-Elsevier divests its newspaper businesses as it is more interested in the highly profitable businesses of professional and scientific publishing. Some five months after the initial announcement that Dagbladunie is for sale, PCM Uitgevers, another Dutch (newspaper) publisher acquires the newspaper properties for 868 million guilders. In the press the consequences of this take-over for the competitive structure of the newspaper industry in the Netherlands is discussed, and -again- politicians express their fears about the high degree of concentration that might result from this strategic move. As a consequence of the take-over PCM Uitgevers becomes the largest newspaper publisher in the Netherlands, controlling four of the five remaining national newspapers, some 31 percent of total newspaper circulation and 58 percent of total national circulation. Four newspaper companies now control 83 percent of the circulation market. After years of mergers, take-overs and shut downs of newspapers the seemingly endless concentration tendency seems to have reached its apotheosis.

’Newspapers on the Internet: it is nothing! Whether you look on Compuserve or Internet, it is all the same. (…) Everyone is looking around on the Internet, and everyone is bored to death.I ask myself: when is this thing going to collapse.’ (INT11.020395, a newspaper executive in March 1995).