Bertelsmann

Company Overview

While Bertelsmann’s list of business areas is long, its number one source of income is the RTL Group, which grew out of the Luxembourg-based station Radio Télévision Luxembourg (Radio Television Luxembourg, or RTL). With currently 68 television channels and 30 radio stations in 10 countries, it is the largest private television and radio operator in Europe. With a revenue of 6.65 billion EUR in 2019, the RTL Group generates about 36% of the total income of the Bertelsmann Group. By contrast, the total revenue of the German Public Broadcasting Station (ARD) was around 6.6 billion EUR in 2019.

As a decentralized organization, Bertelsmann is involved in a range of media and communication markets and services. Since 2016, the conglomerate has been divided into eight separate divisions. Besides the RTL Group, it includes the Bertelsmann Education Group, the Bertelsmann Printing Group, and Bertelsmann Investments. Bertelsmann BMG (music rights) is an international music company with 19 offices in 12 core music markets, representing more than 3 million songs and recordings. This includes, among others, the catalogs of Alberts Music, Broken Bow Music Group, and Trojan, as well as thousands of artists and songwriters (e.g., the rights in songs and recordings by artists such as Kylie Minogue, The Rolling Stones, and David Bowie). The Group also owns the service company Arvato with more than 65,000 employees working in a wide range of sectors in more than 40 countries worldwide. Since 2020, Bertelsmann is also the sole owner of the world’s largest book publishing group (based on revenue), Penguin Random House, controlling a quarter of the world’s book trade, and it owns the international publishing group Gruner + Jahr (G+J). While each division is largely independent, all divisions work together under the umbrella of Bertelsmann. As such, they take advantage of synergies where these exist (e.g., the Bertelsmann Content Alliance).

Like most German media corporations, Bertelsmann is a family-controlled business. After World [Page 184]War II, it rose from being a medium-sized enterprise to a major conglomerate under the leadership of Reinhard Mohn. As of 2021, the Mohn family holds 19.1% of the company’s shares and Mohn’s widow Elisabeth and his son Christoph Mohn are on the group’s supervisory board (next to Thomas Rabe who was appointed to the board in 2006, and has been its chairman and CEO since 2012). The majority of capital shares, 77.6%, belong to the Bertelsmann Stiftung, a foundation founded by Reinhard Mohn in 1977. Mohn (its long-term chairman) initiated this transfer in 1993. In doing so, he not only secured the long-term control of the family over the company but also saved it about 2 billion EUR in taxes. As of 2021, the Bertelsmann Stiftung is one of the largest and most influential foundations in Germany. Financed by the profits of the company, it spent a total of 90 million EUR in 2019 for nonprofit work (in areas such as education, health, and digital technology). Among its four executive board members are Elisabeth Mohn and her daughter Brigitte Mohn. The other 3.3% of Bertelsmann’s shares belongs to foundations, namely the Reinhard Mohn Stiftung and the BVG Stiftung. Members of the Mohn family serve on the executive boards of both.

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