70. Daily Mail & General Trust plc
Revenues 2016: £ 1.917 billion (€ 2.339 billion)
The British media house Daily Mail and General Trust plc (DMGT) is active in the fields of both national and regional newspapers, Internet and radio broadcasting, but has been successfully trying to branch out into other business fields for years, hence becoming more independent from the traditional newspaper business at an increasing rate. While 86 percent of the business revenue in 1986 was generated by the newspaper business, the number decreased to 27 percent in 2009. Nowadays, the major profit generators are business-to-business divisions such as DMG Information and Euromoney.
Despite the fact that DMGT operates on an international basis, the most important business units are located in Great Britain. The flagship of the company is the second-most sold daily newspaper in the country, the tabloid newspaper 'Daily Mail', first published in 1896. DMGT stirred up quite a few global hornets' nests in 2009 when the majority of the 'Evening Standard' was sold off to the Russian billionaire Alexander Lebedew as well as due to the 'victory' in the London freemium newspaper wars against Rupert Murdoch and the subsequent cancellation of the in-house freemium title 'London Lite'.
Northcliffe House, 2 Derry Street, London W8 5TT, Great Britan
Telephone: 0044-020-7938 6000
Telefax: 0044-020-7937 3745
Branches: Newspapers, Magazines, Information Services, Internet, Radio
Legal Form: Public Company
Financial Year: 10/01 – 09/30
Founding Year: 1896 (Public Company since 1922)
Executives and Directors
- Lord Rothermere, Chairman
- Paul Zwillenberg, CEO
- Tim Collier, CFO
Board of Directors:
- Lord Rothermere
- Paul Zwillenberg
- S.W. Daintith
- S. Kavan
- K.J. Beatty
- A.H. Lane
- D.H. Nelson
- P.M. Dacre
- FP Balsemao
- N.W. Berry
- J.G. Hemingway
- Lady Keswick
- K.A.H. Perry
- J.H. Roizen
- C. Chapman
- D. Trempont
The History of DMGT is synonymous with the history of the British 'Press Barons' during the turn of the century: The Daily Mail was published for the first time in 1896, the first national 'cheap newspaper' on the British newspaper market. The publisher Alfred Harmsworth, later gentled as Lord Northcliffe, created a modern paper with a solid journalistic foundation. The circulation surpassed the one million mark as early as 1900. The 'mail' had always been one to make politics: During the Boer War, the mail ignored censorship constraints and went on to uncover understated loss numbers on the side of the British forces, in the First world war, the paper even forced the prime minister to step down. After Lord Northcliffe's early demise in 1922, the company fell into the hands of his brother Harold (who had become a part of the nobility as well by then, as Viscount Rothermere), who managed to walk the fine line between supporting both Winston Churchill as well as the British fascists in the 1930s, which severely damaged the Daily Mail's reputation as an independent-conservative newspaper. In 1928, a chain of regional newspapers (Northcliffe Newspapers) had already been part of the company.
Although the 'Mail' ended up benefiting from the newspaper exodus in the 1960s, it still found itself wedged in a deep-rooted crisis when Vere Harmsworth became head of the company in 1971. The main competitor – The Daily Express – sported a circulation twice as high and a merger of the two papers seemed to inevitably loom ahead. Yet, Harmsworth opposed his own board of directors, positioned the 'Mail' as a sophisticated boulevard paper and relied on reaching out to a younger readership of average education. Later on, the newspaper also spawned the Sunday spin-off 'Mail on Sunday'. Making David English (1931-1998) the editor-in-chief was another coup. Until the time of his death, English was considered one of the most successful newspaper personalities in Great Britain. In 1991, the circulation of the 'Daily Mail' surpassed that of the 'Daily Express' for the first time.
The publishing activities flourished for quite a long time – not alone thanks to elaborate investments into DMGT's own printing offices. In October 2010, the circulation of the 'Daily Mail' hit 2.123.886 copies (minus 2,47 percent compared to the previous year), while the 'Mail on Sunday' sported 1.957.544 copies (minus 4,5 percent). Hence, the papers manage to retain a stable position within the continuously shrinking British newspaper market, wherein not only the publishers stand in competition with each other but also with themselves by challenging their commercial newspapers with freemium titles: The „Metro“ freemium newspaper was launched in 1999 (not to be confused with the internationally distributed Swedish freemium concept 'Metro International') and had been in the black numbers since 2002. DMGT publishes it as joint venture with regional media groups in Yorkshire, Manchester and Scotland as well. On average, 1.3 million copies are distributed all over the nation per day, reaching more than three million readers, according to DMGT's own statistics, which also state that the freemium newspaper is "the world's largest free newspaper".
Starting in 2006, DMGT waged a war against its rival Rupert Murdoch's 'London Paper' (News Corp.) sending their own evening newspaper 'London Lite' into the race – the war of freemium newspapers. When the international media tycoon cancelled his newspaper in September 2009, which had dropped down to 500.000 distributed copies in its last weeks of existence, the DMGT- subsidiary Associated Newspapers could celebrate a victory that surprised many onlookers. Murdoch's title allegedly generated a loss of 9.1 million Pounds within twelve months - “about double the estimated amount”. However, it is safe to presume that 'London Lite' suffers from losses not much less than that. As a result, DMGT cancelled the title on the 13th of November 2009 as well.
The vicious newspaper crisis in England had been the subject of many discussions both in and outside the country when due to a rather radical endeavour: In February 2009, DMGT sold 76 percent of its 'Evening Standard' shares to the holding of the Russian billionaire Alexander Lebedew. Eventually, Lord Rothermere also agreed to the trade – not without comparing the transaction with the death of his parents in an interview with the 'Sunday Times'. The selling price of the paper in deficit, the circulation of which has dropped below the 300.000 mark, but was still said to exert great influence on London politics, amounted to one symbolic Pound Sterling. The buyer, who is widely known as 'Oligarch' or 'former KGB agent', is involved in the Russian airline Aeroflot, but also the opposition newspaper 'Nowaja Gaseta' (among others). Investments of approximately 25 million Pound in the newspaper in crisis were supposed to ensure its prolonged existence. His son Evgeny Lebedew became the CEO of the 'Standard'. DMGT remains involved in the company with a minority sharehold, although its value in the books comes down to zero.
In an ironic turn of events and shortly after the end of the London freemium newspaper war, Lebedew decided to distribute the hitherto 50 pence 'Standard' as a freemium newspaper in the future.
On the other hand, the intention to rely on paid content when it comes to Internet – a philosophy much propagated by Murdoch – remains a hot topic in England as well. Viscount Rothermere was one of the international subscribers of the "Hamburger Erklärung zum Schutz des geistigen Eigentums" (Hamburg initiative for the protection of intellectual property), initiated by the Axel-Springer company, by means of which the newspaper publishers sought to develop potential marketing nodes on the Internet with 'content that is legally paid for for'.
As far as the regional newspaper market is concerned, the British incarnation of which suffers both from the globally known crisis factors as well as the collapse of the previously flourishing advertising market, the DMGT- subsidiary Northcliffe Media realized radical plans ever since its operative revenues sank by 85 percent in the first half year of business in 2008/2009. The measures included a 'pay freeze' for all employees, the closure of freemium newspaper editorial offices such as 'Total Essex' and 'Focus' in West Kent and the merger of units. All in all, a total of 2500 employees were laid off.
Thanks to the intentionally long-term strategy that sought to become more independent of the cyclical nature of the advertising market and the constraints caused by media policies as well as creating a more diversified portfolio of market-dominating B-to-B and B-to-C activities, DMGT is suffering less from the global crisis than many of its British competitors - for the time being. As a result of refocusing on core activities, DMGT has parted with several media activities, such happened in 2005 when the remains of rather unsuccessful TV activities were pushed off, such as the culture channel 'performance', distributed over BSkyB and cable networks. As far as radio is concerned, DMGT already parted with a major part of its 70 stations in Australia in 2004. Merely eight stations in big cities like Sydney and Melbourne remained a part of the company. In 2009, 50 percent of shares were sold to Illyria, the investment company of Rupert-Murdoch-Son Lachlan Murdoch (who operates independently from his father).
As early as December 2009 , instead of 2010/12 as it had been initially planned, the activities in the business field of private economy teletext (a market virtually unknown in Germany) were cancelled and shut down as far as digital television went. Prior to this measure, the DMGT subsidiary had been providing teletext content for commercial channels such as Channel 4 as well as ITV's analogue and digital channels, which reached a total of 13 million viewers per week. In the business year 2007/2008, this business segment generated a loss of three million Pounds. According to DMGT, reasons for the withdrawal from the business had also been the competition in form of the Internet and the relative position of Ofcom, who refused to ascribe teletext-services with public value. In 2009, the withdrawal of DMGT resulted in a penalty fee of 225.000 Pounds issued by Ofcom due to "breaking the public service broadcasting licence". The license is running until 2014 after all.
Only the profitable online activities of the division, first and foremost the tourist sector ( thisistravel.co.uk) are continued.
DMGT is a family company through and through and even the seats in the board of directors are more or less a matter of inheritance: When Vere Harmsworth, the third Viscount Rothermere, died in September 1998, his son Jonathan became the fourth Viscount Rothermere as well as the chairman and head of the company. The Harmsworth-clan ensures its influence by holding on to established structures, which might seem a rather dated strategy in the age of globalisation: Out of the approximately 100 million DMGT-shares, only five million come with a voting right in shareholder's meetings, of which almost 80% are owned by the family itself. Therefore, matters of personnel within DMGT are usually dealt with an accordingly tranquil manner. It was announced in November 2007, that Martin Morgan would succeed the retired Charles Sinclair as CEO in October 2008.
These structures expedited long and solid growth rates, even in times of minor crisis. Paul Dacre, the editor-in-chief of the 'mail' is considered one of the most influential journalists in Great Britain as well as the "the best-paid editor in Fleet Street" (writes the Guardian, which also reported on Dacre's 1.635.000 £-paycheck and the shareholder's wrath over this 'fat cat pay' in 2010). Unlike the Harmsworth family, Dacre is a dependable enemy of the labour party and the possile introduction of the Euro in Great Britain. His newspapers embody the values and views of 'Middle England' and despite their outward design and appereance, they do not consider themselves as boulevard papers, but 'compact newspapers' (Dacre). Complex issues are subject to being “successfully simplified into questions of moral and identity” by the Mail, at least according to the tattling of the liberal 'Guardian'. Not the conservatives would rule over the newspaper, but the party itself would come across as 'junior partner of the 'Mail'. In the meantime, the paper allegedly ceased to be the “the opinion-former it once was", according to the MediaGuardian100 list of the most powerful media personalities in 2010, in which Dacre managed to land on Place 13.
However, in 2011, he climbed up the ranks again and ended up on Place 7, not only for being "by far the best paid UK newspaper editor" but also thanks to his political influence.
After the death of his father, the young head of the company, Jonathan Harmsworth, turned out to be a rather successful heir after all. With an estimated fortune of approximately 1.020 million Pounds, he is the richest amongst all the British Press Barons and landed on place 51 on the 'Sunday Times Rich List' in 2006 that includes the richest Brits; In 2009 he dropped to place 138. Harmsworth had to endure several setbacks: In 2004, during the bidding war over the conservative 'Daily Telegraph', the DMGT syndicate was defeated by the Barclay brothers (Scotsman). In order to prevent that the latter might even consider to snatch away the star editor-in-chief Dacre, Harmsworth increased Dacre's salary by 30 percent. The sale of the Evening Standard in 2009 must have been a painful chapter. In the MediaGuardian100-List 2011, the Viscount plummeted from Place 37 to Place 42.
It is custom not to let go of top-tier personnel without announcing it a long time ahead of its enactment. Such happened in Autumn 2010, when it was announced that the company would part ways with the man who had been finance director since 1991, Peter Williams, in spring 2010. However, a 'real clash of cultures' (as an anonymous insider called it in the Guardian) exemplifies that things can easily turn ugly in DMGT management as well, such happened during one of the many cost efficiency and downsizing measures in 2010: When it was decided that the 'Associated Northcliffe Digital' (AND), the unit for digital audience media with approximately 1000 workplaces, which had just turned profitable, would be merged with A&N Media, the Chief Executive of the division, US-American Richard Titus, who came in from the BBC only a year before, left the company without further ado due to a dispute with A&N Media-CEO Kevin Beatty.
DMGT is the holding for all companies by the Harmsworth family. The company is primarily active in Great Britain. Following several restructuring measures, the DMGT activities in 2010 are divided into the business fields A&N Media as well as Euromoney, dmg events, dmg Information and RMS, in which the respective (quite manageable numbers) international activities are included.
A&N Media consists of Associated Newspapers (AN), Northcliffe Media (Northcliffe Newspapers until 2006) and A&N International Media. The 'Associated Northcliffe Digital', which had been an independent division in between, was dissolved in 2010.
The AN-newspapers include the 'Daily Mail', 'The Mail on Sunday', 'Metro' (freemium newspaper in London and 15 other British cities and regions), 'Irish Daily Mail' (Ireland on Sunday until 2006), 'Loot' and '7 Days', which is published in Dubai. Furthermore, the company operates supplements such as 'This is London' and more than 100 websites, including financing and dating gateways and the digital leftovers of the teletext division. Furthermore, additional acquisitions that are more or less rooted in B-to-B sectors, such as the real estate search engine, of which half the shares were acquired in 2010, are also part of A&N Media. The newspaper division continues and will continue to downsize its staff. Due to the cancellation of 'London Lite' alone in the last quarter of 2009, 334 work places were made redundant.
As of the summer 2010, Northcliffe Media includes "113 daily, weekly and free newspapers and an online network of over 155 local websites" as well as regional printing workshops. Due to rapidly decreasing revenues, several cost efficiency measures were initiated in 2008.
In Ireland, AN and the (company-independent) 'Irish Times' merged their formerly collaborative freemium newspapers 'Metro Ireland' with the 'Herald AM' by the Independent News and Media publisher, which had also been suffering from the crisis. Each of the companies holds a third of the new title - "Metro Herald", of which 65.000 copies are distributed in Greater Dublin by the day. The Swedish Metro International, previously involved in 'Metro Ireland' with ten percent, is no longer one of the shareholders.
A&N International Media is active in seven middle-European and Eastern European states, especially in Hungary (such as the largest local newspaper ' Kisalföld') and Slovakia, where DMGT acquired the leading local newspaper with 'Pravda' in 2006.
2.) Other business branches
Euromoney is a globally active B-to-B company with a focus on international finance markets (about 100 newsletters, databases, online-services, conference and seminar operations). About half of revenues are generated in the USA.
dmg events (formerly 'DMG World Media') is an international fair and congress host; dmg information is also an international B-to-B company for education and university business, real estate, surveying, administration and health. In Germany, DMGT owns the Landmark Information Group, the Inframation AG that is based in Dortmund and Frankfurt, which operate the data service gateway geoport, (among others).
DMG Radio Australia is still home to six commercial radio stations 'down under' and has been 50-percent joint venture with Lachlan Murdoch's company Illyria since the end of 2009.
Last but not least, Risk Management Solutions (RMS), the world's leading provider of services and know-how (according to its own statement) concerned with the calculation and management of risks generated by catastrophes is also part of the DMGT-company.
S.J. Taylor, The Great Outsiders: Northcliffe, Rothermere and the Daily Mail, 1996.
Paul Ferris, The House of Norhtcliffe. A Biography of an Empire.
the Open Society Foundations' Media Program,
Germany's Federal Agency for Civic Education,
the Rudolf Augstein Foundation,
the city of Cologne, Germany,
and the State of Thuringia, Department of Commerce.