2024-03-21 19:33:40
It is rather a time of relief for press publishers. But basically, the end of the concession in favor of a temporary system is a bad deal.
Following the agreement reached on Wednesday within the federal government, press publishers now know where to stand. Compared to the initial version, the time is rather for relief in their ranks, even if major uncertainties remain for the future. The seven partners of Vivaldi are also satisfied with the compromise reached. Decoding in six questions.
What helped resolve the situation?
The De Croo government agreed on Wednesday on a support for press distribution which varies depending on the Region, rather than aid limited to white areas, as imagined in December. This support is granted in the form of a tax credit, to mitigate the impact of the end of the press distribution concession by bpost.
“In the absence of being able to increase the envelope, we are expanding the system, which makes it more robust.”
The new system, which is complex and based on forks, concerns daily and the commercial periodicals. In summary, there will be no intervention in Brussels; in Flanders, this intervention will be 0.17 euros per newspaper until the end of 2025, then 0.15 euros in 2026; and in Wallonia, it will be 0.49 euros per newspaper until the end of 2025, then 0.43 euros in 2026. Magazines will benefit from support of 0.10 euros per copy in Wallonia as in Flanders.
This compromise emerged after a succession of proposals and counter-proposals. The concept of white zones was difficult to implement and did not reassure publishers. They themselves suggested to the government a solution which, after maturation, resulted in Wednesday’s decision.
“In the absence of being able to increase the envelope, we are expanding the systemwhich makes it more robust and reduces the risk of recourse,” believes Deputy Prime Minister Ecolo Georges Gilkinet.
Support does not carry not on advertising magazines, specifies the kern note, but the latter have never benefited from distribution support, indicates bpost. The definition will now be stricter, indicates the Finance Cabinet. The scope of publications supported could therefore be a little smaller than in the past, which would therefore increase the support for others.
The measure ofaid decided in December for non-commercial actorssuch as periodicals distributed by mutual societies, unions or non-profit organizations, in the form of a tax credit for legal entities, is maintained. Ditto for the increase in the expense deduction decided to support the independent booksellers.
Politically, who is there?
Open VLD firstand Prime Minister Alexander De Croo, who wanted to remove public support to newspapers and periodicals, and which obtained its strong reduction, before its suppression. This federal support was 175 million euros per year with the concession to bpost of the distribution of newspapers and periodicals. But as we know, the public market for the award of a new concession was canceled.
From July 1, publishers will have to bear the distribution costs themselves. To help them, a envelope of 50 million euros per year was released in December – which includes aid to independent booksellers. She will removed in 2027. And the Prime Minister resisted pressure from those who demanded an increase in the envelope or an extension of its lifespan.
THE other partners of the Vivaldi however show themselves they are also satisfied. The Greens and Socialists welcome the fact that a form of support for the plurality of the press is maintained. The CD&V, for its part, managed to save the non-commercial press, which some once imagined excluding from the agreement. And the MR is delighted with the continued aid to independent booksellers.
“The distribution cost for publishers is expected to more than triple, but the adoption of the tax credit should offset some 85% of this increase.”
Why do publishers seem reassured?
At the end of the kern, Wednesday, the publishers, both of the daily press and the magazine pressont marked their relief following the agreement reached. The publishers have in fact obtained a few million additional tax credits compared to the initial version envisaged at the end of 2023.
“Compared to the first version, the new system is more sustainable and more egalitarian, since it will no longer apply only to white areas”, summarizes Bernard Marchant, CEO of the Rossel group (Le Soir, Sudinfo, 50% of Mediafin, publisher of L’Echo, etc.).
“THE four daily newspaper publishers (Rossel and IPM, on the French-speaking side, Mediahuis and DPG on the Flemish side, Editor’s note) worked in good harmony to develop these proposals which were finally retained by the government”, underlines François le Hodey, CEO of IPM (La Libre, la DH, L’Avenir) and president of Lapresse.be, the association of French-speaking publishers.
In fact, if the Flemings, who publish almost four times as many daily newspapers, will logically receive more money than the French speakersthe latter will receive proportionally more resourcesbecause the south of the country is less populated.
“Above all, it’s a victory for the state budget.”
François le Hodey notes that the removal of the concession without compensation would have led to an increase in the cost of distributing the newspaper to a subscriber of around 164 euros per year! “According to the first price offers received from bpost, the average distribution cost for publishers should more than triple, but the adoption of this tax credit should offset some 85% of this increase“, he says.
Satisfaction also, finally, from the magazines side because they will receive 0.1 euro per distributed copy, many of them fearing for a moment that they would receive nothing at all.
Why is this still a Pyrrhic victory?
Because the concession systemrenewed every five years and which provided security to publishers for the distribution of their titles, will disappear in favor of this much less advantageous tax credit. “So it’s above all a victory for the state budget,” quips Bernard Marchant.
Publishers will therefore have to take out their calculators. “We will examine how to reduce our costs, it will be more in the back office, because we do not want to increase the price of our subscriptions or reduce the offer to the reader,” specifies the boss of Rossel.
With the current concession expiring on June 30, publishers now have around a hundred days to organize their distribution from July. “At the beginning, nothing will change, because the deadlines are too short, we will continue to work initially with bpost and PPP”, indicates Peter Quaghebeur, CEO of Mediafin (L’Echo, De Tijd).
A situation which will also put pressure on bpost and PPP, ordered to provide a competitive offer to publishers. Negotiations, we are told, are difficult.
Ultimately, all options are on the table for publishers: working with bpost and/or with other operators, or even launch their own distribution system as Rossel does in the North of France.
What will happen after 2026?
“We have exactly 33 months to transform our businesses with a view to becoming a company capable of operating primarily in digital markets.”
As the aid system ends on December 31, 2026, this is the big unknown. The Greens promise to put the subject back on the table, if they are part of the next government. But in any case, publishers will come knocking.
“The first thing we’re going to do is sit down at the table with the future new government. No one can say, at this stage, whether this tax credit law will be extended beyond 2026,” indicates François le Hodey.
“Logically our distribution costs will decrease, as sales of paper newspapers fall on average 7 to 9% per year”, observes Peter Quaghebeur.
Is this the beginning of the end for the print media?
What is certain is that this saga should push publishers to accelerate their digital transition. “We have exactly 33 months to transform our businesses with a view to becoming a company capable of living economically mainly on digital markets”, picks up François le Hodey.
“It’s not not good news for the economic model of publishersbecause paper, although in decline, still brings in much more money than digital, both on the readers’ market and that of advertisers”, comments Bernard Cools, visiting professor of media economics at UCLouvain and director of research at the Space media agency.
At IPM, for example, a digital subscriber brings in half as much as a paper subscriberwhile for advertising, a Internet user generates four times less money than a paper readerindicated its former general manager Denis Pierrard a few months ago.
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