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Monday, February 17, 2003

Bertelsmann Off-line

AOL Time Warner and Vivendi Universal aren't the only media giants who have felt the price of failure deep into their pockets. Germany's Bertelsmann, whose on-line venture suffered a premature demise in 2002 after shelling out millions trying to hold back Amazon and trying to ride the Napster wave, are experiencing not insignificant in-house problems too. I still can't get my mind round the problem of how so many 'old style' business luminaries are going to help dig the pre-internet world out of its mess and point it successfully towards the future in a post internet environment - in Bertelsmann's case it's even the dynastic family behind the curtain who seem to want to step on stage to ressurect themselves and put a stop to all those 'silly' decisions. But maybe I am missing something. One thing's for sure, with all the high pressure meetings and hassle to think about they can't possibly be spending enough time online to be able to begin to appreciate what it's all about.

The internal crisis at Bertelsmann intensified at the weekend as the chairman took the unusual step of warning the Mohn family, founder and majority owner of the media group, not to interfere in the day-to-day running of the business. The comment by Gerd Schulte-Hillen came after Gunter Thielen, chief executive, wrote to employees on Friday to try to defuse rising tension after Reinhard Mohn, the family's patriarch, and his wife Liz severely criticised past managers. Separately, insiders said the board of RTL, Bertelsmann's television unit, might decide as early as this week on a successor to Didier Bellens, who abruptly resigned as chief executive last week to head Belgacom, the Belgian government-controlled telecom group. Bertelsmann executives have been growing uncomfortable about signs the Mohn family, which holds 75 per cent of the voting rights but has long retreated from operational management, was seeking a more direct influence.
Source: Financial Times

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