Le Monde sets up a new business model
Falling circulation and ad revenues forced the journalists at the paper into selling off their majority ownership. Now a triad of French businessmen -- industrialist Pierre Bergé, Xavier Niel, the majority owner of broadband provider Free, and Lazard banker Matthieu Pigasse -- have the largest stake. "The major change," said Kauffmann, "is that the future owners ... will end up owning 70 percent of the shares."
Sylvie Kauffmann, the Executive Editor of Le Monde, spoke about the sale of France's most prestigious newspaper on Charlie Rose last month, saying, "if you ask me whether Le Monde will still be an independent newspaper the answer is yes." In 1951 Hubert Beuve-Mery, Le Monde's founder, secured France's flagship daily's independence from political power by helping create the Society of Journalists, which is basically the newsroom. With that, the journalists, through a complex shareholders structure, owned the majority of Le Monde SA giving the paper its legendary independence. "Today we own about 20% of the shares," Kauffmann told Rose. "But the most important thing is that we have veto power on the appointment of the publisher."
The three have their work cut out for them in turning things around. Paid national newspaper circulation in France is in decline. According to OJD, paid national newspaper circulation fell 4.9% in 2009 compared to the previous year. And then, of course, there is competition from the free dailies. On the average weekday, according to OJD, the circulation numbers for the free French daily 20 Minutes beats national papers like Le Monde, Le Figaro and L’Equipe. Xavier Niel, though, is "very much interested in the digital world," Kauffmann told Rose. Niel wants to "set up a successful new business model, the magic formula we are all looking for." Still one of the greatest newspapers in the world, the debt-laden Le Monde has a circulation around 318,000 in France, second to Le Figaro, but down from 398,000 back in 2003.
The French digital media space is getting crowded. Niel -- the richest of the members of the consortium -- also happens to have stakes in Mediapart and Bakchich, another leftish investigative news Web site. The ad-free, pay wall-funded news website Mediapart is lean (25 editorial staff members), left-leaning, young (founded in 2008), just started publishing in English -- and, most importantly: it ate Le Monde's lunch on the scandal involving L'Oréal heiress Liliane Bettencourt and French President Nicholas Sarkozy.
The two year old site published transcripts, audio files and articles about the secret recordings of the billionairess made by her butler. In June alone, Mediapart drew 5,000 new and paying subscribers -- at 9 Euros a month -- attracted to the immediacy of a scandal, with audio, involving a sitting President and the richest woman in Europe. By 2012, Mediapart, which has over 30,000 paying subscribers, says it will be profitable. Le Monde's "magical formula," however, will have to be different from that of the svelte start up Mediapart. Part of the French businessmen's agreement with the editorial staff was that jobs will not be cut.
Mediapart probably learned many of its lessons from Le Monde. The sixty-six year old paper has actually had an online presence since 1997, though it is not nearly as hungry as its competitors today. In the early part of the millennium, Le Monde's site became part of a major story about allegations of corruption regarding former President Jacques Chirac when he was Mayor of Paris. They published video online -- a pretty radical move for a media company back then, to be sure -- of an aide to Chirac making accusations of kickbacks and slush funds. In the two days in which the Chriac revelations were published, print sales rose 30 percent higher on September 22, 2000, and 39 percent higher the next day.
Since French people generally people prefer to read weekly magazines to dailies, the presentation of a compelling narrative using investigative reporting holds some promise. "Sarkogate" and its positive effects on page views and circulation could also hold lessons to hyperlocal publishers. Investigative reporting on the political corruption and scandal of our leaders creates a narrative every bit as compelling as any television drama (except, quite possibly, Law & Order).