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SCHIBSTED CASE ANALYSIS, STRATEGIES IN A DIGITAL WORLD
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● Schibsted is media group which was founded in 1839 as a newspaper company in Oslo, Norway. It is present in 20 countries. ● Currently, its management is facing some serious challenges after enjoying continued success for past few years. ● Google is threatening its profitability and core value proposition with its plan of a news aggregator in Norway. ● The company is also confronted with challenges surrounding the changing nature of its audience, the startups’ threat and its internal organisational culture. ● They are also faced with a dillemma whether or not to launch ‘free dailies’ in their core and established newspaper markets.
● Schibsted started as a family owned company and was publically listed in July
● A legacy of more than 150 years, with 8500 employees. ● It had two major subsidiaries - Aftenposten and VG. ● After going public, it started investing into Television and other media networks. ● It was well known for its investments in innovative segments.
● In 1995, they acknowledged the threat posed by the Internet to their core newspaper business and decided to act on it. ● They decided to take aggressive positions by utilising their strong finances. ● They decided to transform from a newspaper company to an electronic media company. ● They also planned to expand beyond Norway to other Scandavian nations. ● Schibsted reorganised itself into three business units - Print Media, TV/Film and Multimedia. They planned to keep them separate. ● They invested in certain new IT related projects by partnering with various such companies. ● They introduced free dailies where they did not have traditional media majorly.
Pros: ● Readers are moving towards online news aggregators such as Yahoo, Google etc. for looking at varieties of news headlines. ● It will increase the customer’s base of the company as non-readers of Schibsted will also visit their site if they found the news interesting. Cons: ● It will impact the advertising revenue of the company as there will be less visit on the website. ● There is no ordering in online news feed. ● They will get very less amount from news aggregator for their offering which can not justify the effort made by the company in developing the news content.
Pros: ● It will help in expanding the current market of their print news business. ● Less Administration Cost. ● Revenues only from Advertisement. Comapny can increase the charges for advertisement. ● Suitable for Office Goers who uses public transport. Cons: ● Cannibalization of existing market offerings by the company. ● Complete dependence on advertisement. ● It may not work out well in long term as the company will face challenges in terms of reduced margins. ● It can also got in some legal arguments with its competitors for trying to gain unfair. advantage in the market and exploiting the current competitive ecosystem.
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