Magazine article Editor & Publisher

The European Market: U.S. Newspapers Cannot Ignore New Growth Overseas

Magazine article Editor & Publisher

The European Market: U.S. Newspapers Cannot Ignore New Growth Overseas

Article excerpt

The European market

With the new economic community emerging in Europe, a market is being created that U.S. newspapers cannot afford to ignore, said Brian Knox Peebles, chairman of Consultants in Media Ltd., London, England.

The European Economic Community, formed in 1958, has set Dec. 31, 1992, as the date to achieve a common market. Theoretically, in 18 months' time, Peebles said, all goods, people, services and capital will move freely between the 12 European members: Belgium, Denmark, France, the Federal Republic of Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain and the United Kingdom.

Others are applying for membership, such as Sweden, Denmark, Turkey and some of the recently independent East European countries.

The E.E.C. economy, it is hoped, will grow by at least 5%, with two million new jobs being created and prices being reduced by 6%.

But, Peebles said, just as Europe began to adjust to the necessary agreements for this growth, events in Eastern Europe and the Soviet Union erupted.

"Now, not only are we having to come to terms with the political and economic union of one set of communities, but we are faced simultaneously with the breakup of another," he said.

Two new markets for newspapers are forming, one mature, one embryonic.

The East European countries now opened up to the West include Poland, Hungary, East Germany, Czechoslovakia, Yugoslavia, and Romania. Add to that the U.S.S.R. itself, the Baltic states - Latvia, Lithuania and Estonia - all fighting for independence. This area of East Europe, the Baltic states and the U.S.S.R., forms a separate mega-market of 400 million people, nearly twice the population of the United States. Western Europe is home to 320 million, a nearly 30% larger population than the United States.

While the same number of daily newspapers in Western Europe exist as in the United States (1,600), U.S. advertising revenues are about 80% higher.

"Anyone thinking of setting up business as newspaper publisher in any of these countries should study local conditions, including labor relations and fiscal arrangements, with some care," Peebles said.

"Despite the language and cultural differences between European states, let alone political and legal ones, it is a market you cannot afford to ignore; more, it is a market that is ripe for exploiting," he said.

In Western Europe, 18 different languages are spoken, and powerfully divergent subgroups of political traditions exist within different countries.

The way forward in both West and East is through getting to know equivalents in these countries, and then setting up joint ventures, or shares in each others' companies.

Peebles offers this advice to newspaper companies interested in the European market: Assume that everything beyond the plant, buildings and production processes is different from the United States.

Readership, for instance, is highly varied. Only 30% of Spanish adults read a newspaper daily, while the Swedish level is 93%. The British record 85%, while the United States figure is 67%. …

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