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On a shopping spree: Springer boss Mathias Döpfner
Photo: Kay Nietfeld / dpa
When Mathias Döpfner goes on a shopping spree in the USA, he seldom goes about it sparingly. In 2015, the head of the Axel Springer publishing house grabbed the business portal “Business Insider” for just under half a billion dollars. A year later, the market research company Emarketer followed, for 242 million. Springer secured a majority in the newsletter and podcast producer "Morning Brew" last year for a double-digit million amount. None of it was cheap, and yet: even if you take all the US shopping trips together, they don't come close to Döpfner's latest coup: the takeover of the news site »Politico«.
Both parties have officially agreed not to disclose the purchase price, but the "record amount," as Springer calls it, is said to be at least $ 740 million.
American media even assume over a billion dollars.
A lot of money for a website that only political junkies know in this country - and an almost unheard of price in digital journalism.
Is »Politico« really worth that much?
Or has the "stupid German money", as German capital is often contemptuously called in the USA, arrived again?
Gossip for political professionals
From a journalistic point of view, there is little to complain about about Döpfner's billion-dollar purchase: “Politico” has developed into one of the most important players in the Washington media circus in recent years. Along with the New York Times and the Washington Post, the site is one of the most widely read publications in the political circles of the US capital. The morning briefing “Playbook” and its various newsletter offshoots are required reading in Congress, in the White House and in the capital's editorial offices. Hundreds of top-class reporters work in the website's newsroom, digging up a lot of gossip and gossip from the political scene as well as exclusive stories and sending them to hundreds of thousands of subscribers by email.
But »Politico« is not alone with its mixture of hard journalism and tasty insider information.
The editorial team suffered a setback when one of their best reporters, Mike Allen, quit four years ago to start his own news site.
Since then, Allen and a few other ex-Politico writers have competed with their former employer.
Allen's website "Axios" presents itself with a similar concept to Politico.
It also offers a lot of insider material from the White House or Congress to the politically-minded readership.
Döpfner is also said to have been interested in the "new kid on the block" of US political journalism.
From insiders for insiders
In the past four years, the rise of Axios has not been a problem for »Politico«. Donald Trump provided enough news material for dozens of newsletters, the number of subscribers shot up in all media. In 2020 alone, »Politico« grew by 20 percent, the »New York Times« estimates sales at around 200 million euros. In order to remain relevant in the future, however, the company has to broaden its scope and reach readers who are interested in more than the latest volts in the House of Representatives or in a foreseeable less exciting White House.
Politico Pro, the premium service on the news site, has so far been aimed at lobbyists who put a lot of money on the table for news from the important legislative areas.
The prices at the company's European branch, which Springer has already operated in a joint venture with the Americans, start at 7,000 euros per year, and »Politico« already has its own newsletters on offer for tech and financial topics.
Springer builds on these so-called verticals and can imagine countless other subscriptions, for example on climate topics or artificial intelligence.
Or cheaper variants for simple readers.
That can bring new sales - but are they worth a billion?
"A margin of 30 percent"
If you compare the price with other large purchases, it looks almost astronomical. When Amazon founder Jeff Bezos incorporated the Washington Post a few years ago, he only had to pay 250 million euros. And when Springer tried to get the renowned »Financial Times«, an offer of around one billion euros is also said to have been on the table - after all for a global brand that has more to offer than a handful of newsletters.
Mathias Döpfner defends the purchase.
Politico is "highly profitable, with a margin of 30 percent," said Döpfner to the Handelsblatt, and the USA will in future be the "greatest growth engine for Axel Springer's journalistic business."
A manager of the publishing house, who was not entrusted with the deal herself, calls the Politico numbers a "blast".
The brand "earns real money with its newsletters".
Restrained joy in the editorial offices
In any case, people in the house are relieved that an investment in journalism is finally being made again. In the past few years, Springer was particularly noticeable with his efforts in the so-called »classifieds«, ie sales and comparison portals. These generated sales, but led the publisher further and further away from its core business. Most recently, Springer had tried unsuccessfully to take over eBay classifieds.
Döpfner tried to eradicate doubts about Springer's journalistic ambitions on Thursday at an all-hands meeting to which all the editors of the »Politico« group were invited. Redundancies? Shouldn't there be, on the contrary, they want to hire more people. Amalgamations? Not planned, at most agreements and synergies. The planned journalists' union? Don't worry Springer, you support the editorial team, no matter in which direction they are moving.
Döpfner, that much is clear, is fulfilling a dream with the purchase of »Politico«. The publisher always wanted to have a strong voice in the USA; business insiders have been dealing with business issues for years. Provided that the antitrust authorities approve the acquisition, and there is little doubt about that, Döpfner has also covered the political side.
