EURACTIV joins Mediahuis group: Why media sector consolidation is necessary

After the internet and social media triggered national media concentration, artificial intelligence requires cross-border cooperation, facilitated by new EU policies. Integration of the pan-European network with the five-country group can show the way, writes Christophe Leclercq.

Christophe Leclercq was a McKinsey consultant, EU competition official, and founder of EURACTIV. He now represents the think-do-tank Europe’s MediaLab. 

EURACTIV could have continued independently. Why did we decide to sell the media I created? The key is a shared belief in creating some European media champions.

Mediahuis, present in five European countries, publishes a wide range of news titles, grown from local and national roots. EURACTIV will be its first pan-European news brand. While the deal is explained in our press release (FR, NL, DE), let’s look at the strategic context for the media sector.

Pioneering alone, and now inspiring together?

EURACTIV was an early innovator in the policy field: having free content (supported by distinct and transparent sponsoring), adding stakeholders’ events to reporting, franchising the brand to other countries, publishing in many languages (currently 13), leveraging this network for large EU projects, and chiefly: being pro-European and constructive (while preserving independence). 

However, greater scale and reach are now needed. Alone we could not invest enough in AI for journalism, take part in media consolidation, or chart the strategic autonomy Europe needs. And, last but not least, prevail in a field that is becoming too Anglo-Saxon.

Rising fixed costs mandate consolidation – also across borders

First, the internet put pressure on paper subscriptions, then social media captured ad revenues. This triggered many demises and media concentration: in short, shrinking within country borders.

The media is increasingly a fixed cost activity: staff, IT, and leveraging selected brands across activities. Marketing and tech tools require cooperation, to learn faster and spread costs over several publications.

In the not-too-distant future, automated translation (LangTech) will become prevalent, either roughly ‘on the fly’ (reinforcing platforms), or supporting quality adaptations (post-edited, preserving media’s readership and sales).

Consolidation: the bad, the ugly… and the good!

Concentration could be the slow death of pluralism if it is defensive and purely national. But done across borders – reinforcing several players in several countries – it could strengthen the resilience of both our media and our democracies.

Cooperation between media in Europe can historically be divided into three distinct eras.

Stage 1, since the 1990’s: modernising newspapers

This is notably about moving content and subscriptions online. Now adding sophisticated (and respectful) tracking of users’ needs.

The bad?  Many titles are no longer…

And cross-border pioneering by established players does not always work out: You recall attempts by the Financial Times? By Handelsblatt? By Wall Street Journal? Or by The European?

My old ‘cemetery list’ stands: “Of 20 media groups to ‘go European’ most failed, not all”. Most projects were visionary but ahead of technology (paper does not travel well), and of client needs (most policies were national).

Also, most ‘dotcoms’ are now dead. 

As for EURACTIV, it is a survivor from that era, steadily growing across borders, and could now speed up.

Stage 2: national concentration, plus international pure players 

Calls to go across borders, a few years ago, had not been heeded. The journalistic profession lost around half of its people (sadly, some to murders, thankfully, most to job losses). Apart from state-sponsored broadcasting, the other half is not safe, unless modernisation speeds up. 

The ugly? The ‘enlargement’ wave of Western investment eastward has been rolled back by local oligarch groups and state control in many countries. And even Russian trolls.

Also, many ‘new generation’ online media, financed by stock exchange money, are now struggling.

But there are also success stories and hopes. 

Stage 3, starting now: consolidation with tech and user-data 

My experience of other sectors tells me: We are at the cusp of a new consolidation wave. Politically, this is even overdue, after Brexit, Trump, and Putin’s war.

New AI, but also translation, customisation, and videoconferencing are making a big difference, building on great brands, and great people.

For example, at many media companies, events are often the most profitable department, and expert journalists the best moderators. Just like concerts saved the music industry and its stars. LangTech will soon boost innovation there.

Some initiatives help transnational cooperation. For example, Stars4media has helped more than a hundred companies to collaborate in pairs. Now in its third edition, ‘NEWS’, it was initiated by Europe’s MediaLab, and managed by VUB University and the media associations WAN-IFRA, EJC, in cooperation with the European Federation of Journalists and EURACTIV.

Sector strategy for a “democracy infrastructure”

Before taking the reins of the European Commission, Ursula von der Leyen set democracy as one of her top six priorities. Clearly, it did not get resourced like climate change and Covid.  Defending Ukraine and freedom is not just about weapons: fighting disinformation is key. Healthy media in Eastern Europe may help prevent the next war. 

Despite some governments’ reluctance, EU industrial policies are no longer taboo. The process is just very slow.

What I call ’the information package’ was launched in December 2020: both Digital Services and Market Acts, both action plans for democracy and media. The latter includes the promising NEWS bundle. The impact of these EU initiatives will be limited before the 2024 EU elections. 

Competition rules are also adjusted: Media cooperation is more welcome, and the regulatory balance of media versus platforms is shifting. However, regulators did not yet force the giants to reflect trust indicators in their algorithms, which would demonetise fake news and boost media revenues. 

Legislation, like the currently debated Media Freedom Act, is not enough: media sector consolidation is necessary.

Implications: improve governance across silos, across borders

Our sector is news-driven, but surprisingly slow at changing itself. Some media players start taking their future into their own hands.

The governance of media should build less on national politics and more on innovation, tech, readers’ needs, and public policies. And chiefly on mainstream corporate governance: cross-border cooperation, diversity, and good board practices. 

Governance is what we practice at European Business Media (formerly EBP, benchmarking), and European Digital Media Observatory (policy and fighting disinformation). As for Europe’s MediaLab (ex-Fondation EURACTIV), we are updating our priorities and you are welcome to give a view.  

The media sector should now move faster, with policies and strategies working hand in hand. There is no other way for Europe.

Related links:

Press release on announcement: EN, FR, DE

Personal tributes and MediaLab’s future options

Beyond Brussels policies: leadership for Europe’s news media sector
Media Freedom Act: A rebalanced ecosystem and sector consolidation