Metropol sacrificed on stock exchange altar
An Obituary for Metropol, the "New Economy" Phenomenon in Publishing
An obituary for the publishing new economy phenomenon MetropolBy Oliver Classen Metro International is once again increasingly committed to the profitability of its own group. The shareholders will be pleased, because the Zurich experiment with the commuter newspaper in the green metal box has sunk tens of millions into the Zurich lake basin.
"The Swiss economy on the upswing again" is the latest headline on Metropol's green metal boxes, which have been abandoned since last Thursday. Given the plight of the ad-financed paper a week ago, what sounded like an irrelevant self-commanding formula now looks like a cynical epitaph on a green background. And the associated distribution boxes look like memorials to a publishing new economy phenomenon that has brought Zurich 55 jobs as well as tons of waste paper. But unlike the inventory, these are unfortunately not transportable. Computers and office furniture are already on their way to the Paris branch that has just opened.
In terms of mobility and flexibility, the smart Scandinavians are increasingly succeeding in translating the Ikea and H&M model into the newspaper world. Only profitability is still a problem, as Metro International posted a pre-tax loss of 84.1 million dollars in 2001. This is significantly more than the loss of the previous year (68.5 million dollars). In any case, too much for investors skeptical of media companies. Of the 20 Metropol editions currently published, just four are in the black (Stockholm, Gothenburg, Prague, Budapest). That's a start, but nothing more.
The Group has suffered lasting damage to its image
But as we all know, green is the color of hope. However, the managers of the listed parent company Metro International have lost exactly that, at least for their particularly cost-intensive Swiss subsidiary. For a good two years, Chairman and CEO Pelle Törnberg watched from his company jet (in which he commutes daily between the now 14 Metro countries) as first Urs Zeier, then Lawrence Kenny and finally Robert Gustavsson sank tens of millions into the Zurich lake basin.
Now Törnberg has turned off the money tap for his local representatives at the behest of some large investors who were getting restless - presumably shortly before they would have turned off the dollar pipeline. There is no other explanation for the abrupt and, above all, image-damaging end to the prestige battle with arch-rival 20 Minuten (yellow metal boxes), even by Metro standards. Wherever the two rivals meet in future (initially in Paris, but soon perhaps in Germany), the Schibsted subsidiary 20 Minuten will pull the Zurich trump card out of its sleeve. This will give it an edge in terms of trust with local authorities and potential partners, which could be decisive for success.
More important than any competitive disadvantages, however, is Törnberg's clear signal to shareholders that Metro International intends to fulfill its "commitment to the key factor of profitability" more consistently than before. After all, this first plant closure since the debacle in Newcastle, England, in 2000 is nothing more than a reassurance pill for investors.
The publishing sorcerer's apprentice promises his idealistic and financial mentor, the stock market, to pay more respect to its requirements and expectations from now on. And thus officially concludes the youthful Sturm und Drang period of a new economy company that one cannot and does not really want to imagine as an adult, security-conscious industry player.
"The Swiss economy on the upswing again" is the latest headline on Metropol's green metal boxes, which have been abandoned since last Thursday. Given the plight of the ad-financed paper a week ago, what sounded like an irrelevant self-commanding formula now looks like a cynical epitaph on a green background. And the associated distribution boxes look like memorials to a publishing new economy phenomenon that has brought Zurich 55 jobs as well as tons of waste paper. But unlike the inventory, these are unfortunately not transportable. Computers and office furniture are already on their way to the Paris branch that has just opened.
In terms of mobility and flexibility, the smart Scandinavians are increasingly succeeding in translating the Ikea and H&M model into the newspaper world. Only profitability is still a problem, as Metro International posted a pre-tax loss of 84.1 million dollars in 2001. This is significantly more than the loss of the previous year (68.5 million dollars). In any case, too much for investors skeptical of media companies. Of the 20 Metropol editions currently published, just four are in the black (Stockholm, Gothenburg, Prague, Budapest). That's a start, but nothing more.
The Group has suffered lasting damage to its image
But as we all know, green is the color of hope. However, the managers of the listed parent company Metro International have lost exactly that, at least for their particularly cost-intensive Swiss subsidiary. For a good two years, Chairman and CEO Pelle Törnberg watched from his company jet (in which he commutes daily between the now 14 Metro countries) as first Urs Zeier, then Lawrence Kenny and finally Robert Gustavsson sank tens of millions into the Zurich lake basin.
Now Törnberg has turned off the money tap for his local representatives at the behest of some large investors who were getting restless - presumably shortly before they would have turned off the dollar pipeline. There is no other explanation for the abrupt and, above all, image-damaging end to the prestige battle with arch-rival 20 Minuten (yellow metal boxes), even by Metro standards. Wherever the two rivals meet in future (initially in Paris, but soon perhaps in Germany), the Schibsted subsidiary 20 Minuten will pull the Zurich trump card out of its sleeve. This will give it an edge in terms of trust with local authorities and potential partners, which could be decisive for success.
More important than any competitive disadvantages, however, is Törnberg's clear signal to shareholders that Metro International intends to fulfill its "commitment to the key factor of profitability" more consistently than before. After all, this first plant closure since the debacle in Newcastle, England, in 2000 is nothing more than a reassurance pill for investors.
The publishing sorcerer's apprentice promises his idealistic and financial mentor, the stock market, to pay more respect to its requirements and expectations from now on. And thus officially concludes the youthful Sturm und Drang period of a new economy company that one cannot and does not really want to imagine as an adult, security-conscious industry player.
