Resistance to Change at German Media AG: Publishing Companies in the Digital Age

Resistance to Change at German Media AG: Publishing Companies in the Digital Age

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Abstract

The business model of German Media AG has traditionally relied on revenues from advertising markets to subsidize the newspaper business in the readership market. With the long-term slump in advertising markets that began in 2001 and hit the newspaper industry again in 2008, the company entered a severe crisis of drastically declining revenue streams. German Media AG has unsuccessfully responded to the crisis for more than 10 years by offering digital news, investing in new technologies, and acquiring innovative technology start-ups. To finally jump start a turnaround, Bohning, the vice president of the news department introduces paid digital news as a strategic alternative during a strategy meeting. However, he runs against a strong headwind; during the strategy meeting, most managers are skeptical about paid content ...

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