Where the "P" casts its shadow
Leaseholders feel in an uncomfortable position due to the VSW guidelines criticized by the Weko
Leasehold publishers feel they are in an uncomfortable position because of the VSW guidelines criticized by the WekoBy Markus Knöpfli Thanks to the forthcoming investigation by the Competition Commission (Weko), there is now a debate about the standards by which PubliGroupe ("P") remunerates (or not) its competitors. The fact is: in-house publishers handle the matter more liberally. And some leased titles are not exactly in a comfortable position - partly because the "P" guidelines deny them income.
The Association of Swiss Advertising Companies (VSW), an association of the wholly-owned PubliGroup subsidiaries Publimedia, Publicitas, Publimag and Mosse, has a whole range of criteria. It uses these criteria to assess whether or not a competitor intermediary receives the agency commission (VK) for its services. For the individual intermediary, VSW authorization plays an important, sometimes even existential role: PubliGroupe determines who is paid for its intermediary services for around 500 of the approximately 2000 Swiss press titles - including several large daily newspapers. Not even the Swiss Press Association has as much influence (see box). As a result, those who are not authorized by the VSW do not receive compensation for any PubliGroup leased title (see also WW 41/02).
However, the ComCo's criticism is not directed against the VSW triage in principle, but against individual criteria. These could constitute "objectively unjustified obstacles to competition". The criticized regulations include, for example, the fact that an intermediary must place all categories of advertisements and cannot limit itself to individual sectors. The ComCo also disagrees with the fact that they must be legally independent of their clients and have a business volume of at least CHF 1 million or CHF 100,000 in the case of VSW titles. Nor does it agree with the guideline that an advertising volume should consist of at least 50 percent commercial advertisements and that the advertising rates must also be compliant.
Regardless of the decision that the Competition Commission still has to make: What is certain is that no one else in Switzerland takes such a restrictive approach to the triage of intermediaries. The Swiss Press Association also recommends selection criteria to its members. However, it only contains one provision. This stipulates that the agent must be legally independent of the client, and this could also be affected by the Weko criticism. In addition, independent publishers handle triage more liberally than recommended anyway.
For example, Hansjürg Klöti, Head of Newspaper Advertising at Tamedia, pays particular attention to the fact that advertising is the main activity of the companies entitled to VK. Other criteria include adherence to rates and independence from clients. "In principle, however, we don't want to prevent anyone from doing business with us," he adds. NZZ Publishing Director Tobias Trevisan, on the other hand, is of the opinion that the ownership structure of intermediaries cannot be prescribed. What is important is that the broker does his job professionally, he says. Ueli Eckstein, Head of Print Media at AZ Medien Group, agrees: "As long as an agent works professionally and tries to position himself broadly in terms of customer numbers, we will pay him the commission," he says.
The monopoly protects against possible advertising losses
This makes it clear that intermediaries who are not authorized by VSW will tend to try to avoid VSW leased titles in their media planning and book their own titles wherever possible. The VSW leased titles are likely to lose income as a result. This is also known in the industry. "There is certainly no incentive to advertise in titles that don't pay a commission," says Trevisan - with a view to the VSW leased titles Der Bund, Neue Luzerner Zeitung (NLZ) and St.Galler Tagblatt (SGT), which belong to the NZZ Group.
"Circumventions cannot be ruled out completely," says Jürg Weber, Publishing Director of NLZ. But he adds reassuringly: "The matter is not so dramatic for us, because there are hardly any alternative options in our area. Despite the VSW guidelines, we are therefore missing out on relatively little." In other words: the company's own quasi-monopoly protects it from major problems.
It seems to be no different in Basel. In any case, Daniel Sommer, publishing director of Basler Zeitung, says: "I've never had the impression that we've been circumvented because of the VSW guidelines."
There is no monopoly in Bern, which is why the VSW guidelines could be a particular handicap for the leased title Der Bund. But Bund publishing director J. Pepe Wiss initially reveals himself to be a VSW hardliner: "The VSW guidelines only hinder the agents, never the customers. The latter can always come to us." Moreover, it is not his business to review the VSW criteria, which should bring order to the industry. "We have a bigger loss if every second person who comes along with an advertisement receives the VK," adds Wiss - confirming that the VSW guidelines are causing him at least a small loss.
The Solothurner Zeitung (SZ) makes the same point. There, the matter is not disputed, but merely relativized. "The bigger problem for us is the dumping prices with which the Espace Media Group offers its Solothurner Tagblatt", says Rudolf Rentsch, Director of Vogt-Schild/Habegger. To which he immediately adds: "We also have open channels via the MittellandZeitung." With which Rentsch immediately shows the non-commissioned intermediaries how they can still occupy the SZ by bypassing the "P". Sommer is obviously also aware of such loopholes when he says with a wink: "An agent is more likely to look for detours in order to obtain the VK anyway."
Marcel Suter, Managing Director of AZ Wochenzeitungen AG, is one person who sometimes offers his hand in this regard. Although the Aargauer Woche and other titles from his company are leased by VSW, they have never given up selling them themselves. That's why he has been approached directly by specialist brokers. Suter speaks of two to three local customers - not even professional brokers! "These are exceptions, but we do them," says Suter, who can certainly understand the "hard-hitting" line of the "P". The result of his approach: "The 'P' and I are always at loggerheads, partly because the invoicing always goes through the 'P'." It's clear that they don't pay out sales, that's just a matter for AZ Wochenzeitungen AG. The main thing is that the ads come in.
Back to the publishing directors of large leased titles: the longer you talk to them, the more clearly some of them express their scruples about the VSW guidelines. Even hardliner Wiss admits: "There are individual cases that the 'P' sees differently to us, and we have to talk about them." Sommer also thinks it is wrong to punish those who acquire advertisements professionally. Weber from the NLZ takes a similar view. He considers it "sensible", at least from the publisher's point of view, for an intermediary to be compensated for "professional preparatory work". However, SGT publishing director Daniel Ehrat is the most outspoken. "In my view, solutions must be sought. Discrimination against individual professional brokers is at the very least critical. After all, the quality of a brokerage is not dependent on whether it only works in one sector or whether it covers all sectors." It is obvious that "P" has a different opinion on this, as can be read in the interview on page 33.
The verdict of the Competition Commission is therefore also awaited with great interest. Weber: "I am curious to see what will come out of this investigation."
Piquant association recommendations
The Association of Swiss Advertising Companies (VSW), an association of the wholly-owned PubliGroup subsidiaries Publimedia, Publicitas, Publimag and Mosse, has a whole range of criteria. It uses these criteria to assess whether or not a competitor intermediary receives the agency commission (VK) for its services. For the individual intermediary, VSW authorization plays an important, sometimes even existential role: PubliGroupe determines who is paid for its intermediary services for around 500 of the approximately 2000 Swiss press titles - including several large daily newspapers. Not even the Swiss Press Association has as much influence (see box). As a result, those who are not authorized by the VSW do not receive compensation for any PubliGroup leased title (see also WW 41/02).
However, the ComCo's criticism is not directed against the VSW triage in principle, but against individual criteria. These could constitute "objectively unjustified obstacles to competition". The criticized regulations include, for example, the fact that an intermediary must place all categories of advertisements and cannot limit itself to individual sectors. The ComCo also disagrees with the fact that they must be legally independent of their clients and have a business volume of at least CHF 1 million or CHF 100,000 in the case of VSW titles. Nor does it agree with the guideline that an advertising volume should consist of at least 50 percent commercial advertisements and that the advertising rates must also be compliant.
Regardless of the decision that the Competition Commission still has to make: What is certain is that no one else in Switzerland takes such a restrictive approach to the triage of intermediaries. The Swiss Press Association also recommends selection criteria to its members. However, it only contains one provision. This stipulates that the agent must be legally independent of the client, and this could also be affected by the Weko criticism. In addition, independent publishers handle triage more liberally than recommended anyway.
For example, Hansjürg Klöti, Head of Newspaper Advertising at Tamedia, pays particular attention to the fact that advertising is the main activity of the companies entitled to VK. Other criteria include adherence to rates and independence from clients. "In principle, however, we don't want to prevent anyone from doing business with us," he adds. NZZ Publishing Director Tobias Trevisan, on the other hand, is of the opinion that the ownership structure of intermediaries cannot be prescribed. What is important is that the broker does his job professionally, he says. Ueli Eckstein, Head of Print Media at AZ Medien Group, agrees: "As long as an agent works professionally and tries to position himself broadly in terms of customer numbers, we will pay him the commission," he says.
The monopoly protects against possible advertising losses
This makes it clear that intermediaries who are not authorized by VSW will tend to try to avoid VSW leased titles in their media planning and book their own titles wherever possible. The VSW leased titles are likely to lose income as a result. This is also known in the industry. "There is certainly no incentive to advertise in titles that don't pay a commission," says Trevisan - with a view to the VSW leased titles Der Bund, Neue Luzerner Zeitung (NLZ) and St.Galler Tagblatt (SGT), which belong to the NZZ Group.
"Circumventions cannot be ruled out completely," says Jürg Weber, Publishing Director of NLZ. But he adds reassuringly: "The matter is not so dramatic for us, because there are hardly any alternative options in our area. Despite the VSW guidelines, we are therefore missing out on relatively little." In other words: the company's own quasi-monopoly protects it from major problems.
It seems to be no different in Basel. In any case, Daniel Sommer, publishing director of Basler Zeitung, says: "I've never had the impression that we've been circumvented because of the VSW guidelines."
There is no monopoly in Bern, which is why the VSW guidelines could be a particular handicap for the leased title Der Bund. But Bund publishing director J. Pepe Wiss initially reveals himself to be a VSW hardliner: "The VSW guidelines only hinder the agents, never the customers. The latter can always come to us." Moreover, it is not his business to review the VSW criteria, which should bring order to the industry. "We have a bigger loss if every second person who comes along with an advertisement receives the VK," adds Wiss - confirming that the VSW guidelines are causing him at least a small loss.
The Solothurner Zeitung (SZ) makes the same point. There, the matter is not disputed, but merely relativized. "The bigger problem for us is the dumping prices with which the Espace Media Group offers its Solothurner Tagblatt", says Rudolf Rentsch, Director of Vogt-Schild/Habegger. To which he immediately adds: "We also have open channels via the MittellandZeitung." With which Rentsch immediately shows the non-commissioned intermediaries how they can still occupy the SZ by bypassing the "P". Sommer is obviously also aware of such loopholes when he says with a wink: "An agent is more likely to look for detours in order to obtain the VK anyway."
Marcel Suter, Managing Director of AZ Wochenzeitungen AG, is one person who sometimes offers his hand in this regard. Although the Aargauer Woche and other titles from his company are leased by VSW, they have never given up selling them themselves. That's why he has been approached directly by specialist brokers. Suter speaks of two to three local customers - not even professional brokers! "These are exceptions, but we do them," says Suter, who can certainly understand the "hard-hitting" line of the "P". The result of his approach: "The 'P' and I are always at loggerheads, partly because the invoicing always goes through the 'P'." It's clear that they don't pay out sales, that's just a matter for AZ Wochenzeitungen AG. The main thing is that the ads come in.
Back to the publishing directors of large leased titles: the longer you talk to them, the more clearly some of them express their scruples about the VSW guidelines. Even hardliner Wiss admits: "There are individual cases that the 'P' sees differently to us, and we have to talk about them." Sommer also thinks it is wrong to punish those who acquire advertisements professionally. Weber from the NLZ takes a similar view. He considers it "sensible", at least from the publisher's point of view, for an intermediary to be compensated for "professional preparatory work". However, SGT publishing director Daniel Ehrat is the most outspoken. "In my view, solutions must be sought. Discrimination against individual professional brokers is at the very least critical. After all, the quality of a brokerage is not dependent on whether it only works in one sector or whether it covers all sectors." It is obvious that "P" has a different opinion on this, as can be read in the interview on page 33.
The verdict of the Competition Commission is therefore also awaited with great interest. Weber: "I am curious to see what will come out of this investigation."
Piquant association recommendations
The Swiss Press Association is also involved when it comes to the eligibility of advertisers for VC, but only in the form of non-binding recommendations to publishers. These can be found in the "Basics in the Swiss print advertising market". According to this, the decision to commission an intermediary is the responsibility of the individual publisher. "There is no central recognition procedure," it clearly states.
What is piquant, however, is that PubliGroupe should not actually be recognized as an intermediary according to the association's recommendations. This is because it literally states: "The intermediary company is a legally independent company and therefore independent of clients and contractors." PubliGroupe clearly does not fulfill the latter requirement: it holds a stake of up to 37 percent in numerous contractors (publishers).
Other criteria, however, are similar to those of VSW: an intermediary should work for several customers, take various ad titles into account when booking, handle the transaction on its own account and also take on the del credere. And - last but not least - adhere to the publisher's rates. Unlike VSW, however, the volume mix or the size of the business volume are not criteria (mk).
