NBC Universal invests 200 Million into Vox Media and 250 Million into Buzzfeed (still unconfirmed, but it’s a done deal). Valuing Vox at about 1 Billion and Buzzfeed at 1.5 Billion. The combined value of those two companies is now 2.5 Billion. Which is more than the Market Cap of The New York Times.
We’ve been asked by a client, who has been invited to attend the Blattkritik at Der Spiegel, to comment on the current issue, give examples of great journalistic work – especially in reporting about the technology market, as well as provide a general assessment of the current state of affairs in the media business. A Blattkritik is basically a sit down with the editorial team to discuss what could’ve been better in the previous issue. They invite previous contributors and outside experts to those meetings to get a broader perspective on their work. The client asked us to help them shape some of the topic points they can take to that meeting.
It turned out to be somewhat of a conundrum for us. While we do read German media, we have currently no subscription to a German daily or weekly. Neither Johannes nor I have picked up Der Spiegel in a while unless someone recommended us a specific article. In those cases, we end up reading only that specific article without paying much attention to the rest of the magazine. The question is: why?
We have currently two subscriptions at the office: The Economist and Bloomberg Businessweek. We read them both as carbon copy, despite the fact that our subscription give us access to all of the digital properties of both publications. Johannes is sometimes using The Economist’s feature where one can create a personalized podcast. Basically an audio version of the print magazine. Both The Economist and Bloomberg Businessweek provide a perspective on global affairs. They have overlapping audiences, but cater to them differently. While both magazines pride themselves being opinionated, probably no publication currently can claim to have such a clear voice as much as The Economist.
The question remains: why are two founders of a business consultancy based in Berlin, with a majority of clients in Germany not reading a German outlet, specifically the weekly with the largest circulation? And whenever we would need to pick one, we would still not end up picking Der Spiegel. Both of us agreed that it would either be Die Zeit or the weekend edition of Süddeutsche Zeitung (which Johannes used to subscribe to).
There are a couple of observation that I wanted to document in that context:
German Media in the era of Merkel
If there is one characteristic that can be applied to the German chancellor, it is the lack of leadership, the tendency only to act as a reaction. All opportunism, no courage. With approval ratings high, that behavior can not be easily discarded. It’s a reflection of Germany and it feels often times as if it applies to the German media as well.
On the business model side, we see very few things happening and the ones that do are mostly small, incremental changes that are based on the best cases that usually have been developed outside of Germany a while ago. Slow adaptation isn’t wrong per se, but the current pace surely can not compensate for the decline in print circulation.
But that alone isn’t the qualifier why German media doesn’t capture our attention as much as international outlets. It’s the content.
One aspect about The Economist and Bloomberg that came up in our conversation is that they attempt, at every step of the way, to help their readers navigate a complex, interwoven, networked world while German media, and specifically Der Siegel, often end up attempting to simplify complexity. Those are substantially different attempts to see the world and the former is one that is at the core of what Third Wave as a company attempts to do. We can not, we will not succeed figuring out some of the most drastic problems that humanity has faced with the Merkel way of leadership and with a media landscape that follows suit. An informed citizenry with the ability to deliberate and in a democratic process is what we need and neither our political parties nor many of this nation’s journalists seem to be capable of providing this.
This, certainly, is not a unique problem of Der Spiegel, it happens across the board. But being the market leader usually means that one would attempt to hold and / or expand that position. Now, I want to be honest, from a business perspective it probably makes sense to cater to only what the audience wants to hear. Der Spiegel doesn’t seem to pick topics based on their significants, it picks topics based on what they want to say to their large (yet shrinking) audience. This seems to mostly work out fine for them. Courage, experimentation, diving into complexity and challenging the national conversation can be both exhaustive and expensive. As so many before, market leaders tend to lose their edge and their lust for their new and rely on a strategy that is mostly about defense.