Strengthening the Core

The Power of Creativity

Bertelsmann acts from a position of strength: The company occupies leading market positions and operates very profitably. To ensure that this remains the case, Bertelsmann creates an environment that encourages, rewards and protects creativity. Television, radio, books, magazines, digital businesses and services - Bertelsmann is active in a wide range of sectors. But all of the company's activities have one thing in common: They are businesses that require artistic as well as entrepreneurial creativity. Therefore, strengthening Bertelsmann’s core primarily means strengthening creativity.

"Creativity is the foundation of all our businesses, the centerpiece of our value creation. We will therefore continue to invest in and expand our creative businesses."

Thomas Rabe, CEO

RTL Group is constantly developing new TV formats and expanding its families of channels to counter the increasing fragmentation of the viewer market, and thereby diversifying its sources of revenue. Mediengruppe RTL Deutschland has augmented its portfolio of channels with special-interest channels, and uses airtime to show additional content such as home-shopping or call-in offers. This helps open up growth opportunities even in mature markets.

Creating environments where creativity thrives

The worldwide success of the "Fifty Shades" trilogy shows the important role media companies can play in an era in which digitization allows everyone to produce and market their own content. Initially self-published by the author E L James, the books became mega-sellers thanks to Penguin Random House’s positioning, marketing and distribution of the English, German and Spanish editions – clearly demonstrating the publisher’s creative energy and skills. Creative success for Bertelsmann is a prerequisite for commercial success: RTL Group’s TV channels are number one or a close runner-up among viewers in all its European markets. The book-publishing group Penguin Random House sells nearly two million books every day. The publishing house Gruner + Jahr reaches readers and users in over 30 countries. And Arvato’s service center staff managed more than 300 million calls last year alone on behalf of customers worldwide. That calls for an environment where creativity thrives. To make this possible and put the expertise of our people to the best possible use, we need appropriate structures – another element in the strategic focus of "strengthening the core." In this context, one of the measures Bertelsmann took last year was to focus its services subsidiary Arvato on the fast-growing services business.

Maximizing the potential of the core can also mean combining one’s creative assets with those of other companies – in other words, to use opportunities for consolidation without relinquishing one’s claim to leadership of the business. One example of this is the combination of Bertelsmann’s book publishing group Random House with Pearson's Penguin Group. The merger delivers an unparalleled diversity of publishing opportunities for authors and makes it possible to publish book content even more effectively – in traditional as well as digital formats. These are the preconditions for the future of the two major publishing houses – and for strengthening the core business of books.

Copyright protection in a digital world

Not only should creativity be able to thrive – to be sustainable, creativity must also be worthwhile. This requires, among other things, a reliable legal framework that makes it possible to invest in digital content and new business models. Bertelsmann gives artists and media professionals a platform – and demands that their work should be adequately rewarded in the digital world, too. Creativity is the engine of Bertelsmann’s businesses. If the ideas arising from it are not protected, the basis of these businesses is lost. Many digital revenue models are only commercially viable if they are given appropriate copyright protection. Bertelsmann actively works to provide information about the value of intellectual property, to enforce copyright protection in the digital world, and take action against the illegal dissemination of content.