GAIN Growth Initiative Underway As Bertelsmann Priority

More than 100 projects set, with medium-term revenue potential of €1 billion

Berlin, March 17, 2005 – Bertelsmann is systematically implementing the initiative for more growth and innovation (GAIN – Growth and Innovation) it launched in 2003. Since GAIN was begun more than a year ago, approximately 100 new business ideas with a medium-term revenue potential of around €1 billion have been identified. Some of the most promising projects are underway, and are already showing tangible results in the divisions. The initiative is designed to promote growth throughout the group with new content, products and services. “In the world’s largely mature media markets, growth will not happen by itself, but will require newly developed, innovative products. We revved our engines in 2004, and now we’re shifting up a gear,” as Bertelsmann Chairman & CEO Gunter Thielen metaphorically stated at the Annual Press Conference in Berlin. In 2005, the group will advance ongoing projects and develop more new business ideas to achieve sustained growth in its core businesses.

The GAIN initiative is at the heart of entrepreneurial action in all of Bertelsmann’s divisions: For example, RTL Television went on air with “Traumpartner TV,” Germany’s first interactive dating channel. The production company Ufa introduced a new TV format to Germany: telenovelas. In the U.K., the media services provider Arvato will take over parts of the administration from the council of East Riding. Under the terms of this public private partnership, Arvato will handle the collection of local taxes, the administration of the citizens office, and wage accounting for the council’s civil servants. It will also be in charge of all information technology. Meanwhile, Arvato Mobile has commenced a new line of business with games, videos, music and ringtones for cell phones. A few weeks from now, Arvato Mobile will be going live with GNAB, a download platform for a wide variety of digital content. Gruner + Jahr added bi-weekly TV guides to the French TV listings market with “Télé 2 Semaines” and “TV Grandes Chaînes,” which were two of the most successful new launches in the French magazine market in recent years. Random House is publishing comic-style illustrated “Manga” novels for new target audiences in the Western world and is developing the audiobook market internationally. Direct Group is offering members of its Internet-based music club Yourmusic.com one CD per month as a subscription service, as well as access to 14,000 CDs containing more than 100,000 music titles − all at the same low price.

 For further questions, please contact:
Oliver Herrgesell
Senior Vice President Media Relations
Phone: +49 – 5241 – 80 – 24 66
oliver.herrgesell@bertelsmann.com

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