To force 20 Minuten out of the market, Tamedia needs the support of other publishersBy Markus Knöpfli Whether Tamedia can win its war against 20 Minuten is written in the stars. A flop is just as likely. After all, the "Express" project has a number of sticking points. And it won't work on its own. That's why Tamedia CEO Martin Kall is trying to rally other publishers behind him - with pressure if necessary.
Even if the new "Express" comes in a handy tabloid format and with 300,000 copies, is expanded editorially and delivered to all Zurich households early in the morning and is also available in boxes throughout the metropolitan area, Tamedia has only gained one thing - higher costs.
The main advantage over 20 Minuten, early delivery, was already available with the Zürich Express (ZE). Early delivery not only means that the product reaches the reader a few minutes earlier than any print product in a box, but in this case it also means - and above all! - double commuter potential: what is in the letterbox at home early in the morning can be picked up not only by public transport commuters but also by car commuters. So far, the ZE has not really been able to exploit this double pole position. It mainly reached non-mobile contemporaries. That was its handicap.
But the new "Express" also starts with handicaps. Not only does it have to shake off the ZE groove, which ironically still echoes in the name, but it also has to be of such good quality that car commuters in particular will take the detour to the letterbox before going into the underground garage. The quality of the "Express" must also be so impressive that you won't put it down even when you come across the familiar 20 minutes. These are high standards that will cost a lot of money and some heads. Those of Markus Hegglin and Heinz Krebs will probably not be the last.
Tamedia has another problem to deal with: A product that offers readers more quality for free than 20 Minuten will inevitably increase the erosion of readership at the Tages-Anzeiger.
However, the main problem with the "Express" is ultimately its USP. Precisely because of its home delivery, it continues to reach mainly "homebodies". In the best-case scenario, it may gain commuters in addition to the existing ZE audience - but such a broad target audience is diffuse and entails high scattering losses for advertising customers.
All this shows: Tamedia cannot win the war on the reader market level alone. The "Express" needs a second front - in the advertising market.
However, as the paper is supposed to be limited to Zurich, it has to enter into alliances. All statements to the contrary by "General" Kall and his staff (see also page 5) are either deceptive maneuvers or errors. 20 Minuten already established in both Zurich and Cologne that it cannot finance itself solely from a large city market. The Cologne publishers, who fought 20 Minuten with their own commuter paper, came to the same conclusion. With a large circulation and a diffuse target group alone, Kall is not able to wipe this realization off the table.
In fact, the "Express" now has an unprecedented opportunity to network in the Golden Triangle or even further afield - with other free newspapers. "We are watching with interest what is happening in Zurich," confirm both Beat Meyer, CEO of Basler Mediengruppe (BM), and Paul Galli, responsible for local newspapers at Espace Media Groupe. Their signals to Zurich are clear: "A Zurich-Bern-Basel triangle is always interesting," says Galli. "Such a combination makes perfect sense," says Meyer. "We are not averse to a combination", adds Peter Wüthrich, Director of Anzeiger Luzern/Luzerner Woche.
It is unclear whether Kall will take the outstretched hand. There are some indications, but nowhere are talks confirmed. However, a combi also creates new problems: On the one hand, there are the different sheet formats in front of it. Much more delicate, however, is the fact that a free newspaper combination would compete with the Swisspool, which is likely to further siphon off the Tages-Anzeiger - and not only it.
Conclusion: No matter how Tamedia turns things around, the "Express" project will be very expensive for them. And it needs staying power. Just until comparable readership figures are available for the "Express", 20 Minuten will have a further one and a half year head start.
Has Kall learned from the Cologne publishers? That would be the greatest danger posed by the "Express" project - and not just for
20 minutes. In Cologne, publishers engaged in price dumping or exerted pressure on suppliers, customers and printers.
Kall already seems to be doing the latter: The threat of war against the Aargauer Zeitung in the last SonntagsZeitung was hardly just because of neighborly animosities; rather, the aim was to make AZ Medien AG lose its printing contract with 20 Minuten.
The statement that Tamedia is in talks with Basellandschaftliche Zeitung can also be interpreted as an attempt to put pressure on BM. And Kall has other trump cards up his sleeve. The most sensitive one for 20 Minuten: for a year now, Tamedia-Verlagslogistik has been the general contractor for all transportation for 20 Minuten - from the printing plants to the boxes.
A twelve-year-old idea comes back to life
Twelve years ago, the idea for an advertising combination of the free newspapers in Zurich, Bern, Basel, Lucerne and St. Gallen came from the ranks of the free papers, but the large publishing houses preferred to implement it with their own daily newspapers (SwissKombi, later Swisspool) rather than with their own free papers. Two years ago, when 20 Minuten and Metropol had been launched, the free newspaper combi was again the subject of intense discussion - primarily between ZE, Baslerstab and Berner Bär. This time there was a blockade in Zurich: NZZ, which holds a 40% stake in ZE, was opposed to a combination that would have isolated Anzeiger Region Bern, which belongs to its own group, in Berne.
But now Tamedia has launched a liberating move: By separating the official Anzeiger (still 60% Tamedia, 40% NZZ) and the future "Express" (100% Tamedia) in Zurich, Tamedia will be free to decide with whom it wants to combine its "Express" from spring 2003. This is why there is now movement again in the combination discussion. "The clear constellation in Zurich will certainly make it easier to hold such talks," confirms BM CEO Beat Meyer - and he is not the only one. (mk)