Europe’s biggest newspaper publisher, Axel Springer SE, is wagering that it can earn money from digital news by attracting readers who pay in both Europe and the United States.
By the second half of 2016, Axel Springer plans to begin charging fees for some content on its mostly ad-financed Upday mobile news app. Upday’s chief product officer, Jan-Eric Peters, made the announcement on Tuesday.
Upday is still involved in beta testing and officially will not be released until early next year. The Berlin-based company is also considering whether to launch a subscription version of Business Insider. In September, the publisher agreed to take over the Business Insider in a $343 million deal.
The announced changes are part of a broader plan by Axel Springer Chief Executive Officer Mathias Doepfner to heavily spend on digital media - mostly in English-speaking countries. The company also announced that it increased its stake in Now This Media, a New York-based social media video producer, from 4.3% to 14.6%. This follows a $16 million round of funding.
The publisher is also financially backing the Thrillist Media Group - a lifestyle outlet that targets male readers.
The publisher also purchased the remaining 15% in its digital classifieds division from General Atlantic LLC for approximately $508 million in shares. The division operates real estate and job portals such as Immowelt and Totaljobs, in addition to the Israeli classifieds portal Yad2.
Axel Springer announced that it is “full of optimism” on its United States push. However, Doepfner, a former music critic, also acknowledged to German reporters that “some things will work out while others may fail. Money follows attention - hopefully.”
Interestingly, Axel Springer noted that the Upday app will be launched only on Samsung smartphones next year. The publisher is in negotiations with Samsung to pre-install the application eminently on its mobile devices, which currently are the best-selling mobile devices in Europe.