“We reach more than one million paying digital subscribers in 36 countries. Axel Springer has never had so much journalistic impact in its history”, CEO Mathias Döpfner was quoted in the German newspaper Handelsblatt.
This week Axel Springer SE concluded the largest acquisition in its company history, taking over the digital politics and business magazine Politico. Until now, Axel Springer SE was only a 50 percent owner of the Brussels-based European offshoot of Politico.
The Berlin-based media company (who runs newspapers like Bild and Welt) signed an agreement to fully acquire the US news company Politico and the news website Protocol, which specializes in the technology sector, Axel Springer announced yesterday. With the purchase, Axel Springer strengthens its position on the US market, which, along with Germany and Poland, is one of the core markets of the Berlin media company.
“Like CNN, the Washington Post and the New York Times, Politico is one of the most powerful media brands in American political journalism”, the Handelsblatt article noted.
A profit generation engine
“We are convinced that we have acquired the company at an attractive price. Politico is highly profitable, with a margin of 30 percent. And the potential is generally huge”, Döpfner said. In 2020 alone, Politico grew by 20 percent; the New York Times estimates its turnover at around 200 million euros. The newsmagazine Der Spiegel quoted an Axel Springer executive today, who said “Politico’s figures are a cracker. The brand earns ‘real money with its newsletters’”.
As noted in an earlier piece on the deal, Politico is a “high value subscription” media due to a combination of factors that include its research capabilities and tools. In particular, the “politico pro” tools are closer to business software with their functionality.
Robert L. Allbritton, Founder and Publisher of POLITICO and Protocol, is quoted in the Springer press release: “As POLITICO and the newly founded Protocol became more successful over the past few years, I increasingly realized that a global company would probably be in a better position than a family entrepreneur like me to further drive our worldwide growth, serve our target groups even better and offer our employees even more opportunities.”
Becoming more Anglo-Saxon
The move builds on Axel Springer’s list of US properties. Already in 2015 they acquired the US media platform Business Insider for around $500 million. One year later came the purchase of American market research company Emarketer for $242 million US dollars. Its reach has since increased from 30 million to over 600 million unique users.
The Handelsblatt colleague Catrin Bialek commented very aptly today: “The Berlin-based media company Axel Springer is in the midst of a far-reaching restructuring. With the acquisition of the American news company, Politico CEO Mathias Döpfner wants to realign the publishing division, which was once the cornerstone of the company. Thus, the publishing business will become more Anglo-Saxon – the US business is to set the pace for digital journalism at Springer. The Berlin media house, which employs around 16,000 people worldwide, has finally visibly expanded its US business in recent years.”
Döpfner explained Tuesday that springer now wants to hire more people. All signs point to expansion. At least that is what he wants to communicate.
Continue Reading: A very good summary of the development of Politico is given by Joshua Benton at Niemanlab