The keys to success in digital transformation for the publishing and media industry
Benjamin Jentzsch, CEO and owner of Linde Verlag, and Berthold Baurek-Karlik, CEO of Venionaire, describe what digitalisation still brings for publishers and media and what role start-ups play in it. The interview was originally published in German on extrajournal.net. We are happy to provide the translated interview for our non-german-speaking audience:
Extrajournal.Net: What does digitisation mean for the publishing and media industry from your point of view? Is it a simple change from paper to screen or are there fundamental differences?
Berthold Baurek-Karlic: Media companies and publishing houses have faced the consequences of digitisation for a long time. Films, television, literature, music, etc. have shifted strongly into the digital space in the last 10 years. Corona has even accelerated this development – but every change also brings opportunities.
When digitalisation was still in its infancy, it was enough to transfer content unspectacularly from paper to screen. Today, that is no longer enough to inspire users. Digital services must offer the user added value – especially if these services are part of a business model. For a specialist publisher like Linde, the cross-media provision of content is crucial. The digital offering complements, expands and enriches the analogue offering. Individual tools and services also enable us to grow abroad, while the analogue offering remains strongly limited to Austria.
Benjamin Jentzsch: Studies show that mobile internet use in particular is still increasing. Digitisation must be constantly optimised with regard to user behaviour. Linde Verlag is looking at new business models and addressing new target groups with digital offerings. One example: For many years, Linde Verlag has published the SteuerSparBuch (Tax Saving Book), which explains how to optimise your own tax burden. In addition, we will launch the new tax-saving app “MeiMarie” in March 2023. “MeiMarie” provides tips and input on tax-optimal behaviour and offers an AI-supported collection of receipts. Thus it ultimately helps the user to get the most out of the employee tax assessment. The book provides a general overview, the app is the constant companion through a tax year.
Extrajournal.Net: In the past, media were often bought “per piece” – be it a legal handbook or the edition of a daily newspaper. Of course, there were always subscriptions, but the customers or users had the choice to make a single purchase instead. Does the future belong only to subscription models of all kinds?
Berthold Baurek-Karlic: Digitalisation has redefined the subscription model. For a specialised publisher, this is a challenge because you have to provide up-to-date content on a daily basis. No digital product today works as a “one-time purchase”, like a book. On the other hand, the subscription also offers advantages, of course, because it delivers recurring revenues. This was not possible with books.
With Linde Media, Linde Verlag started early to publish high-quality articles. Such a detailled free offer generates attention, but also costs money. Sooner or later, the generated reach must also be used economically. It is particularly important to find a good balance.
Extrajournal.Net: What other possibilities of digital business models – from advertising revenue to consulting services and events – are becoming more important?
Berthold Baurek-Karlic: Media companies act as a hub for software and information. Linde enjoys great trust among its readers. Therefore the company must carefully select its content in terms of quality.
In the area of traditional news, the counterpart is the major daily newspapers and public service media. These media companies have a variety of new business models due to digitalisation. The possibilities for a wide range of advertising formats (from online banners to sponsored articles and social media activities) are virtually limitless.
For Linde as a publisher of specialist literature, advertising revenue and consultancy services are not that important. Much more important here is the enhanced positioning of the authors, experts and consultants who provide our content and publish it through us cross-medially. Established publishing houses can bind their customers more firmly to them with the digital expansion of their product range and also develop further business areas.
Extrajournal.Net: Linde relies on start-ups to enter new markets and develop new products and business models. What are the advantages of this approach? Do you need more capital and increased management capacity in-house to implement such an approach, what are the challenges?
Benjamin Jentzsch: We founded Linde Digital to develop new business models, and to specifically expand our digital competence. Digitisation offers a great opportunity for further development in the areas of tax, business and law. We are specifically driving this forward together. Due to this great potential, it is impossible to implement all these developments ourselves. Here we rely – together with our partner Venionaire Capital – on strategic investments in innovative start-ups.
The challenges certainly are keeping an eye on all relevant market developments and the respective players. This is also where the partnership with Venionaire comes into play. The leading venture capital and private equity specialist can look back on more than 10 years of experience in the evaluation of start-ups and knows exactly when the right time has come for an investment or a participation.
Extrajournal.Net: How do you see the Austrian publishing landscape as a whole? Are we more likely to be innovators or more likely to be at the back of the pack compared to other countries, the EU average?
Benjamin Jenztsch: Developments in this area are very cost-intensive. The primary cost driver is the necessary speed. It is in the nature of things that a small country like Austria cannot always be amoung the first movers. In addition, specialised publishers like Linde are very strongly focused on their own country markets. Comparisons with other countries are therefore rather difficult. Digital products, however, increasingly offer the possibility of scaling across countries. But there is definitely still plenty of upside potential here.
Benjamin Jentzsch is Managing Director and owner of Linde Verlag and Linde Digital GmbH.
Berthold Baurek-Karlic is CEO Venionaire Capital & Head of Digital Transformation Linde Digital GmbH.