News Agencies

Abstract

Without news agencies, the global media system would not be able to operate in the form in which we know it today. Regardless of the respective media landscape and freedom of opinion, print, radio, TV and online media depend on permanently obtaining reliable information about political events, key economic figures or even natural disasters. News agencies collect, check, and process such information in order to disseminate it further. However, their business model is put under pressure as the media changes. Thus, they are increasingly trying to win customers outside the traditional field of news media.

1 Introduction

The core business of news agencies is the sale of information to third parties and in particular to the media, for which a constant “noise floor” of news is essential. Agencies contribute to value creation in the media market in two ways. On the one hand, they form the basis for newspaper columns, websites, radio broadcasts and television formats as a comprehensive source of information. On the other hand, since their establishment, they have ensured that journalists report from regions or countries to which many of their clients are unable to send correspondents for financial or other reasons.

The range of services offered by news agencies – the information as a commodity for the purpose of political communication, commerce and entertainment – tends toward an extreme form of “journalism of information”. This distinguishes it from the “more refined and creative journalism of opinion” of other media genres (Boyd-Barrett & Rantanen, 1998, pp. 1, 6). Unlike other media companies, agencies usually operate in the background and provide services for other companies (B2B). When their contributions are then published in the media, unchanged or edited for the respective target group, not every recipient knows how to interpret the abbreviations that identify an agency contribution. This “shadowy existence” seems to continue in the specialized literature. There are only a few relevant or more comprehensive works (e.g., Zschunke, 2000; Segbers, 2007; Schulten-Jaspers, 2013; Vyslozil, 2014b) that provide information on how news agencies work, how they finance themselves, and what plans they have for their business model in an increasingly digital media future.¹

News agencies also play an important role as drivers of new communication technologies. In the nineteenth century, for example, they already relied on modern transmission technologies such as telegraph cables, and as early as the mid-twentieth century on computers (Boyd-Barrett & Rantanen, 1998, p. 32). Until today, technological developments, especially against the backdrop of digitization, and accompanying changes in media usage behavior and in the competitive environment, are still considered a key issue that will set the framework for news agencies in the future. Therefore, agencies are required to consistently develop their IT capacities and capabilities (Vyslozil, 2014a, p. 331).

Overall, the global agency scene is characterized by extraordinary consistency. State-independent national news agencies in Northern and Central Europe have an average age of over 120 years (Vyslozil, 2014b).

There are currently about 20 independent news agencies worldwide – in the sense of being independent of political parties (Dörfler & Pensold, 2001, p. 434; Segbers, 2007, p. 16) – while around 75% of all news agencies are state-owned (Vyslozil, 2014b). Three global agencies (AP, Reuters, AFP²) and ten national agencies based in Europe³ are independent. In addition, Canada, India, and Japan each have one independent agency (Vyslozil, 2014b). The independent Australian News Agency AAP was closed in 2020 (Stummer, 2020).

In the case of state-run or semi-state-organized agencies, leadership in management and the editorial office are determined directly or indirectly by parliament or the government (Group39, 2019, p. 6). For reporting from countries with state-controlled agencies, global or international agencies and their own correspondents in these regions are of particular importance (Vyslozil, 2014b).

The path of a news item in the classic media business sector was and is clear: After news agencies have produced multimedia news content, they make it available to media companies. These in turn act as B2C providers and select certain agency content to publish it online and offline in their media. (Fig. 1):

Fig. 1

Path of a news item from the perspective of news agencies

In particular, the following external factors are causing a change in the framework conditions of news production and selection:

• The number of potential traditional media customers is decreasing,

• Circulation and reach of many traditional media offerings are declining.

• New entrants to the media industry are not dependent on information services provided by news agencies, for example, because they focus on entertainment and/or have little or no in-depth reporting.

• For users, digital news offerings from different media brands are easily comparable; access is often provided through aggregators such as search engines or social network algorithms.

• In digital media offerings, there is almost unlimited space for journalistic content of all kinds, and updates can be made permanently.

• Many digital media services provide engagement choices (e.g., like, comment, and share) for their users.

• Especially through social media, user-generated content can be posted online by “anyone,” and can be distributed to a dispersed audience – this challenges the “gate-keeper” role of journalists, especially that of news journalists.

This article aims to outline current business models of news agencies and, where possible, to substantiate them on the basis of data from individual agencies. The focus is on news agencies in German-speaking countries, global agencies and universal agencies that basically report on all areas of public life (Zschunke, 2000, p. 82). The most important question is how the business cases of news agencies are adjusting amid media change and which innovation scenarios are being considered or already implemented.

Leading news agencies in German-speaking countries (dpa, 2022; APA, 2022; Keystone-SDA, 2022) and worldwide (AP, 2018; AFP, 2021a; Reuters, 2022; EFE, 2021), which are referred to in many cases in the following text, are presented at a glance in Tables 1 and 2.

Table 1 German-language news agencies at a glance

Table 2 Global news agencies at a glance

Special agencies⁴ and press services that focus on specific topics or target groups, as well as media networks⁵ and other news projects⁶ are not explicitly referred to in this article.

2 Business Model of News Agencies

The value chain of news agencies is too narrow in scope to capture the central challenges of media change. The strong effects of changing framework conditions are particularly evident in those aspects that are adjacent to genuine value creation. In order to ensure a systematic examination of news agencies, their business model is analyzed, schematically based on the nine building blocks of the “Business Model Canvas” by Osterwalder and Pigneur (2011) (Fig. 2):

Fig. 2

Business Model Canvas

Central characteristics of news agencies are their B2B structure and the interdependent relationship with customers and partner networks. In order to present this type of company in a comprehensible way, the business model is rolled out starting from the central value proposition that news agencies provide. Due to their decisive role in the case of news agencies, the core partners are then introduced and, building on this, the customer structure is explained. The next focus is on the key links to the customer: On the one hand, the channels for product and service provision, and on the other, customer relationship management (CRM). Subsequently, the chapter highlights the key activities and key resources that are essential for a news agency to create a value proposition for its customers. Finally, this chapter compares the resulting central cost drivers with the most important revenue and pricing models. In the description of the individual building blocks, potential opportunities for change resulting in particular from digitization are included.

2.1 Value Proposition of News Agencies

Content has been the undisputed core competence of news agencies ever since the first agencies were founded (Havas in Paris in 1835 and the predecessor agency of the US Associated Press (AP) in 1848). In order to be able to continue to provide the core product of news for the benefit of media and non-media customers some 200 years later, the necessary services around the product have had to and still have to be constantly adapted.

News agencies convert information into news. Information only becomes news through contextualization and re-signification. Awareness of this process step and its impact on the spin of the news is gaining importance in the digital age. Against this background, news agencies are more than input-output organizations that ensure the “flux of information”. Their networks have social, political and/or economical interconnections and effects. News agencies ensure that social discourses are diffused. According to Thomas Bauer, news agencies in a globalized and mediatized democracy can be characterized as a concentration point of knowledge, experience, and the organizational culture of social discourse in a media-democratic environment (Bauer, 2005, pp. 11–13).

The goal of cooperative agencies is to offer added value, especially for media customers. They achieve this by reducing their costs and increasing efficiency, for example, through appropriate projects, services, or products (Grüblbauer et al., 2021, p.15).

To ensure a continuous flow of information, one of the central functions of news agencies is to collect, check, process, and distribute information as quickly as possible (Schulten-Jaspers, 2013, p. 58; Agenturjournalismus 2016). While the collection and processing of information is based primarily on qualitative principles, the speed of distribution was and is largely dependent on technical capabilities (Dörfler & Pensold, 2001, p. 537).

Information service providers such as news agencies are highly affected by media convergence (Dörfler & Pensold, 2001, p. 534). The tasks of news agencies therefore go far beyond the mere provision of news. Especially against the backdrop of digitalization, the verification of news is gaining importance (Gösmann, 2015). Continuity, universality and archive functions are also becoming more important, not least in order to enable journalists and other customers themselves to verify news.

New challenges have arisen since the mid-1990s in the distribution of agency materials to online-only customers. Access to the most important world news, a formerly expensive commodity, is available on the Internet – supposedly – free of charge. Content from news agencies – even in the case of paid offers – is usually found as free content of the respective online news offers and hardly generates revenues directly, but mainly through cross-financing through advertising. In addition, formerly good agency customers issued the slogan that agency material – due to its non-exclusivity – was an obstacle on the way to a better, more individual media product (Segbers, 2007, pp. 10–11; on the topic of paid content, see Spiegel online, 2015 as an example).

For recipients, information and breaking news on current events are therefore mostly available free of charge on news portals, news aggregators, or social media. In contrast to agency reports, however, many feeds are usually not checked for veracity, have no compelling periodicity or continuity in news content production and no universality of topics (Schulten-Jaspers, 2013, p. 105; Trankovits, 2015, pp. 17–25 as well as pp. 85–87). The effort required by editorial offices to check information from social media for accuracy of content is considerable (Vyslozil, 2014b). Even more than in the past, the verification of information and gossip is gaining importance for news agencies, and thus their role as a credible, reliable partner for the media and other customers. News agencies, for example, offer their clients curated Twitter lists to separate relevant from less relevant Twitter accounts in big news events. They also rely on complex verification processes to block false tweets or fake Twitter accounts (Presseportal, 2014; Schulten-Jaspers, 2013, p. 206; Gösmann, 2015). The Associated Press, for example, has set up a generally strict process for verifying user-generated content (Silverman, 2012). The fact that agencies nevertheless still make mistakes in this respect is shown by the case of the German Reuters service, which in the asylum dispute between the CDU and CSU in the early summer of 2018 adopted a fake tweet by an editor of the satirical magazine “Titanic” as news (see, e.g., Asmus & Kumpfmüller, 2018).

Another challenge for news agencies is that their news content can be distributed on the Internet without much effort and thus be used (and shared) by users mostly free of charge. As long as this is done via news aggregators, the widely discussed ancillary copyright in Germany (and similar measures in other countries) was supposed to allow remuneration of the authors here, such as traditional media houses, but was not extended to news agencies. Since late summer 2016, a European version of such a remuneration for media houses and content providers was discussed. In Spain, for example, such a law did not work as intended by the legislator: the search engine company Google, for example, no longer indexed such media that demanded a snippet remuneration on Google News (Schulten-Jaspers, 2013, p. 106; Kühl, 2016).⁷

The possibility of integrating real-time service and archive databases into a single digital system extends the “actuality” as a traditional core competence of news agencies, by the new dimension of “permanence”. It is true that in earlier times, there was also a corresponding archive – but it is only through digital indexing that this can also develop a real added value in agency services (Dörfler & Pensold, 2001, p. 515).

Due to the close exchange relationship with media clients, changes in the media industry have a direct impact on news agencies and vice versa. Agency journalists act as editors and curators or as impetus providers who point journalists to relevant developments and do not just deliver ready-made products. Important impulses came, for example, in the expansion of multimedia offerings and in the development of compatible content for tablets, smartphones and other mobile communication devices (Bouhs & Milz, 2010; Schulten-Jaspers, 2013, p. 206). Or they form “virtual editorial communities” via web-based applications (Goldmedia, 2011). Savings in newsrooms mean that there is also an increasing demand for in-depth information, analyses, and features on the news from news agencies (Schulten-Jaspers, 2013, p. 108).

Non-media customers benefit above all from the fact that they are informed as much as possible in real time. This means that they are informed of news which is available about them or about relevant industries (monitoring) at the same time as media operators and can thus react promptly, if necessary. In addition, as subscribers they receive direct access – unfiltered by media – to agency news. They are also prepared to a large extent for what – due to the high reach of the agencies – will dominate the headlines on the same day and the following morning. One of the challenges for agencies with corporate communications customers is their general demand on all suppliers to guarantee a very high availability of their service and to stipulate this in so-called service level agreements (SLA) (Segbers, 2007, pp. 100–102) .

2.2 Key Partners of News Agencies

At the heart of the world’s news production are three global agencies: the American Associated Press (AP), the formerly UK-based Reuters agency (now part of Thomson Reuters), and the French Agence France Presse (AFP). In addition, international agencies also provide world news. These include Deutsche Presse-Agentur (dpa, Germany), Agenzia Nazionale Stampa Associata (ANSA, Italy), and Agencia EFE (Spain). However, the majority of agencies are national news agencies whose focus is on individual countries. Of these, most agencies are operated and controlled by governments. Nearly one-third of internationally recognized countries – many of them in Latin America – have no news agency (Segbers, 2007, pp. 15–23).

The global networking of virtually all news agencies worldwide, regulated by exchange agreements, represents a unique position. Without such cooperation between the 100 and 110 news agencies existing worldwide, they would hardly be able to – today as in the mid-nineteenth century – ensure their worldwide coverage. The agreements regulating the exchange of news between agencies precisely define territorial responsibilities (Vyslozil, 2014b). If there are no exclusive agreements (such as dpa with AP), media and companies can also obtain news directly from global or international agencies or specialist agencies. This intensifies competition between information providers (Segbers, 2007, p. 174).

In addition to the regional reach, the legal form of the agencies also determines with which external partners agencies must work closely in terms of financing and strategic steps. (1) As public limited companies , whose shareholders are mainly media companies, operate, for example, Reuters (at the global level) and Keystone-SDA (Switzerland) (Schulten-Jaspers, 2013, p. 59). (2) Organized as a limited company is, for example, dpa (internationally active, based in Germany, with 180 shareholders). (3) Cooperatives , which can be both profit and non-profit, include AP (global, based in the USA), ANSA (international, based in Italy), and Austria Presse Agentur (APA, Austria). (4) State-owned or semi-state-organized agencies include AFP⁸ (globally active, headquartered in France) and EFE (internationally active, headquartered in Spain) or the Chinese Xinhua, the largest state news agency in the world with around 7000 employees (Segbers, 2007, pp. 15–38).

German-language news can be obtained from the three national agencies Keystone-SDA (Switzerland), dpa (Germany), and APA (Austria) as well as via two global news agencies (AFP and – since the termination of the dpa contract in 1971 – Reuters) (Segbers, 2007; dpa, 2021). A German-language offering from AP is distributed by dpa (dpa, 2016e). The three national agencies cooperate on a project basis.⁹

While the exchange between national agencies takes place primarily at the editorial level, the exchange of news with global agencies¹⁰ is additionally based on a monetary compensation. The national news agencies usually only maintain their own correspondent bureaus in countries that are politically or economically relevant to them, mainly for cost reasons. In order to nevertheless offer foreign news, they cooperate with global or international agencies that operate correspondent networks in up to 150 countries around the world (Segbers, 2007, pp. 177–178; AFP, 2016; Vyslozil, 2014b).

If national agencies obtain their news content from global agencies, they can forward them to their own customers either (1) selected but in the original, (2) modified or at least translated, or (3) as original news content created in the course of in-depth research based on information from various agencies (Segbers, 2007, p. 15).

In addition, news agencies work with national agencies or specialist agencies as well as with non-news agencies such as the global visual media company Getty Images (for example, AFP) and Corbis (for example, Reuters) (Segbers, 2007, pp. 178–179) and furthermore with trend scouts, technology service providers (for example, cloud computing), software companies, process managers, etc. (APA, 2016e).

There are also associations that promote regular exchange between news agencies, such as The European Alliance of Press Agencies (EANA) ¹¹ and Group 39¹² or MINDS International. According to their managing director, Wolfgang Nedomansky, MINDS is a kind of “think tank” for the agencies. At the same time, MINDS forms a network – also with “guests from outside” (Nedomansky, 2015). Since 2007, the more than 20 international agencies have met twice a year within the framework of MINDS International to exchange ideas about the future of media and the technical or content-related challenges (for example, trend topics of the agency future such as dealing with social media). This agency network emerged from an earlier EU initiative. From an association perspective, MINDS members are the leading news agencies in their respective home markets, ranging from agencies in Europe to North Americas The Canadian Press and Japan’s Kyodo News, and including the three global news agencies (AFP, AP, Reuters) (MINDS, 2022). European agencies are very strongly represented in MINDS.

The agencies’ core partners also include PR service providers that are particularly involved in the distribution of press releases and contribute significantly to the agencies’ value creation. For example, the PR service news aktuell is a 100% subsidiary of dpa. Among other things, the profits of the news aktuell subsidiary ensure positive financial statements for the dpa group as a whole, while the actual classic core business has been incurring high losses for years.¹³ APA also generate part of its revenues from APA-OTS, the Austrian equivalent of news aktuell (APA, 2016a).

Public value services of the agencies are no longer supported only by governments or state funds, but also by private-sector initiatives such as Google’s “Digital News Initiative “. Here, the funding body defines what “high quality journalism” is considered worthy of funding (Digital News Initiative, 2016). An alternative in the form of revenue sharing for journalistic performance through ancillary copyright has not yet taken place for news agencies in Germany (Schulten-Jaspers, 2013, p. 106), but has been negotiated for AFP in France (Der Standard, 2021).

Of increasing interest to news agencies is the promotion of media-related start-ups in order to show their own customers possible solutions in the digital transformation. For example, dpa cooperates with other Hamburg media companies (such as “Die Zeit”, Springer, Gruner + Jahr) in the “Next Media Accelerator,” an incubator based on the American model. Here, among other things, promising founders are promoted whose technological approach or product ideas are potentially marketable and, in the best case, generate returns for the investors (nma, 2016; Schwanenberg, 2015). In addition, agencies invest in new business areas: for example, dpa, which expanded its video offering in 2020 by acquiring the video news agency TeleNewsNetwork TNN (dpa, 2020b) .

2.3 Customers of News Agencies

News agencies basically operate in the B2B business and supply both media and non-media customers. From the point of view of the news agencies, the two customer segments differ in that the former also use news for publication and the latter generally for their own information. Against the backdrop of digitization, however, the exchange of news via agency infrastructures is being intensified on the one hand (e.g., PR reports) and on the other, agencies also want to sell selected content to non-media customers for their corporate media (corporate publishing) or as part of their content marketing activities in order to generate additional revenues (APA, 2016d; dpa, 2016b; AP, 2015b).

One exception to the B2B model is the stock-listed group Thomson Reuters, which, as the classic agency brand Reuters, also supplies end customers directly (Kantchev, 2012, p. 39) with Reuters.com and the mobile-optimized Reuters TV (Reuters, 2016a).¹⁴ Another exception are limited offerings with the most important news, as offered by Associated Press as an app in the USA (AP, 2015a).¹⁵

Attempts to address end customers directly have also been made by other agencies, but these have not been very successful.¹⁶ The reason for this is that media companies – historically, especially publishing houses and broadcasting companies – are usually both customers and shareholders or owners of the news agencies in the case of cooperatively or privately managed agencies. It is therefore in the interest of the owners that agencies work B2B and are not news suppliers and competitors at the same time.

Conversely, there are and have always been efforts by newspapers to work without a news agency. While the Austrian newspaper “Kronen Zeitung” has managed without a national news agency since 1959 and, before the Internet, mainly used teletext as a source of information, the German newspaper “Bild,” for example, abandoned its attempt to work without a news agency – despite the large number of its own journalists – after 2 days (Der Standard, 2015).

Ultimately, news agencies benefit from the fact that they provide such a comprehensive range of information that most media companies cannot manage without it for the foreseeable future (Zschunke, 2000, p. 271; Segbers, 2007, p. 11). This is particularly evident in countries where extensive news coverage is served by only one agency – such as AFP in France or EFE in Spain. Although AFP and EFE also have customers all over the world, they are de facto monopolists in their home countries (Segbers, 2007, p. 174).

The customer policy of news agencies is highly dependent on the company and shaped by the respective legal forms or owners.

There are restrictions on customer segments: Owners or shareholders of the agencies can prevent or encourage targeting or offers to certain customers (non-media customers or media genres such as classified media). At dpa in Germany, for example, the classified advertising periodicals distributed free of charge were excluded as customers for a long time at the request of members.¹⁷ The APA service, on the other hand, has been available to both members and non-members by subscription since its foundation (Dörfler & Pensold, 2001, p. 423).

Owners or shareholders are often at the same time important customers or practically “obligated” customers of the news agencies. However, it is possible, for example, at dpa – unlike at APA – to be a shareholder and not purchase the news service (Schulten-Jaspers, 2013).

A stronger focus on non-media customers is recognized as an economic necessity in many agencies, but was started at very different times and has progressed to different degrees. Drivers are, for example, the return to core competencies (Reuters), limited growth potential of domestic media markets (APA) or structural problems of the media market (dpa).

The international agency Reuters News was founded as a business service, later supplemented this with a political service for private business people, and only then did the media companies also become customers. Over the years, these emerged as the main customers (Dörfler & Pensold, 2001, p. 518). From the 1960s and 1970s onwards, however, the agency embarked on a course that ultimately resulted in an international financial information group – including stock market capitalization. For some time now, Thomson Reuters has only generated up to 2.5 % of its total revenues from traditional news (Reuters, 2016c).¹⁸

At APA – partly due to the limited size of the Austrian media market – a diversification of the market beyond traditional media customers was already being pursued at the end of the 1980s, following a trend set by the Thomson Reuters agency. Since 1988, it has increasingly offered target-group-specific information as a service for decision-makers in business and politics, thus securing a lucrative field that cross-finances the basis of the news agency, i.e., the service for media customers (Dörfler & Pensold, 2001, p. 516).

News agencies therefore offer various other services, building on traditional core competencies of agencies – the availability and organization of information:

• Specific news selection for non-media customers such as companies, authorities and organizations (associations, trade unions, political parties, NPO/NGO etc.): For example, dpa has been offering a service with selected news since the 1980s, which is now used by a number of German DAX companies under the label “dpa-Select” or “dpa-Business” (Segbers, 2007, p. 102).

• Secondary exploitation of content for follow-up, not necessarily daily publication and use, for example of photos, by the dpa-Picture Alliance (Segbers, 2007, p. 152).

• Original Text Services (OTS) enable customers to make use of the agencies’ technical infrastructure for processing and distribution. They create the opportunity to publish and organize their own information. Thus, on the one hand, non-media customers can access the corresponding “press portal” for their publications, and on the other hand, journalists can obtain these OTS messages directly via their content management system.

• Media monitoring builds on the process competence of agencies to import, store, bundle, analyze and process information. Social media monitoring and the observation and analysis of the distribution paths of individual messages are gaining importance here.

• IT services for media and non-media customers who need fast, reliable, and powerful processing of information: These services are already a central part of the positioning, especially at the Austrian APA (Dörfler & Pensold, 2001, p. 517). Current tasks that require technological know-how include, in particular, the expansion of automated content, robot journalism, and solutions using artificial intelligence (Grüblbauer et al., 2021, p. 15).

• Services for government customers: for example, at the French AFP, the share of revenue from government customers has always been comparatively high – it is around 30 to 40 percent.¹⁹

The developments shown illustrate that the formerly clear hierarchy of news production, at the top of which stood the agencies as external content providers supplying to the newspapers, is being replaced by a network of connections. Quite a few information providers sell to all kinds of buyers (Dörfler & Pensold, 2001, p. 517). The choice and variety of offers for traditional news buyers, i.e., newspapers, radio, and TV stations or pure online providers, has never been more extensive (Goldmedia, 2011). However, these “new” information providers do not necessarily fulfil the verification function of news agencies .

2.4 Customer Relationship Management of Agencies

“News agencies are rarely in the public spotlight. Nevertheless, they are one of the most influential and at the same time one of the least known media genres. They are key institutions of substantial importance to any media system. They are the invisible nerve center that connects all parts of this system”, former APA managing director Wolfgang Vyslozil summarized the importance of news agencies (Segbers, 2007, p. 10).

One prerequisite for this is global networking, a unique selling point of news agencies. It requires constant exchange and development processes that optimize the smooth flow of news feeds, especially against the background of technical developments.

For international exchange, there are various joint platforms between news agencies, media companies and IT. In particular, technical standards are coordinated within the framework of the IPTC (International Press Telecommunications Council) in order to simplify the spread of information between media companies by means of uniform formats and metadata standards (IPTC, 2016).

As early as 1965, the IPTC was founded for this purpose as a consortium of 55 globally leading news agencies, media companies and manufacturers of IT systems for the media sector (Der Standard, 2006). Various open standards, with which the IPTC would like to enable global, smooth Cooperation between news media are constantly being further developed. The aim is to reduce the costs of cooperation on the agency and customer side through standardization.

Software programmed according to IPTC standards is partly made available by news agencies, partly free of charge under open-source licenses, for implementation in editorial content management systems. Nevertheless, it takes a lot of effort for newsrooms to implement them (APA, 2016c).

Some news agencies see it as their task to establish and develop collaborations between media companies. This is effective when relevant projects for several media companies (at least 2) are identified and realized (Grüblbauer et al., 2021, p. 15).

2.5 News Agency Channels

News agencies continuously supply their customers with regional, national and international news of all categories (Segbers, 2007, p. 43) in the form of current texts, illustrations, photos, videos (AP, 2015c), stock market data, charts (Reuters, 2016b), up to animations for tablet and web (APA, 2016b) etc. for internal processing or distribution. The options for the language selection of the news (only in the respective national language or multilingual) vary depending on the agency.²⁰

News is now no longer necessarily presented to the customer in the form of the classic agency ticker – even if this view is still present in most editorial content management systems, in which several agencies often appear simultaneously. Instead, agencies, for example, rely on client portals.

Via B2B portals, agencies enable their customers to obtain the latest news (dpa, 2015b), whereby access and usage rights are regulated differently depending on the contract. Agency material can be viewed, searched, and also commented on in real time (Trankovits, 2015, p. 185).

Frequently, these portals also provide access to their own and international agency archives as well as media and specialist databases. This means that content can be aggregated from comprehensive source pools which makes it easier to search for and find documents that originate from various print media as well as specialist and company databases, transcripts of radio and TV programs, image and graphic data, videos, and special topics.

2.6 Key Activities of News Agencies

The product portfolio of news agencies, despite all innovations for new markets, is still strongly newspaper-house oriented (Segbers, 2007, p. 62). However, the range of products offered by publishers is also in a state of flux.

In addition to the main business of providing news text services/tickers, an agency’s core business also includes sports news coverage and picture services. The services are often supplemented by images (infographics), radio, video services, online services, mobile services, or news for children (Segbers, 2007, pp. 62–80).

News agencies are still agenda setters and deliver non-exclusive information raw materials (basic news service) in real time. As a basis for news content, they filter thousands of press releases as well as daily reports from foreign agencies and correspondents, according to relevance. Therefore, news agencies are considered to have a central gatekeeper role.²¹ They archive agency and media reports and also use them for fact-checking current reports as well as for contextualizing information (BKA, 2003, pp. 83–85, p. 90).

All activities take place against the background of the central task of an agency editorial department: to deliver journalistic quality around the clock. In the agency business, this means above all that “accuracy takes precedence over speed ”. News content should only be passed on to third parties after being checked (BKA, 2003, p. 95; APA, 2015, p. 10). In order to maintain quality standards of the basic news service (these have been partially stipulated in the statutes), a minimum level of funding is required, which must be ensured (Grüblbauer et al., 2021, p. 15).

Quality in terms of meeting customer expectations is complex for news agencies that supply “raw material” to a portfolio of strategically differently oriented customers. Even if only the needs of newspaper customers are considered, these differ according to newspaper type, circulation area, own foreign correspondents, editorial office size, etc. (Segbers, 2007, p. 87).

The respective quantitative agency output cannot be directly equated, as different information is counted as news (Goldmedia, 2011). Based on the regional spread, the following basic news services can be defined: Basically, the three global agencies offer text and images everywhere in the world, at least in one world language (Segbers, 2007, p. 61). Due to a lack of image rights, international agencies are partly unable to fulfil this principle completely. For example, in contrast to global agencies such as AP and AFP, dpa was unable to provide images for its Spanish text in Latin America until recently, because the image rights of the joint operation of the European Pressphoto Agency (epa) for Latin America were held by the Spanish EFE (Segbers, 2007, p. 62; in 2016/17 dpa revised this policy, see dpa, 2016g; OTS, 2017). In general, the foreign share of images at APA and Keystone-SDA, and until 2017 also at dpa,²² comes primarily from the European Pressphoto Agency (epa). However, for important international events of particular significance for the respective media clients, agencies also send their own photographers abroad (Segbers, 2007, pp. 66–69). The added value of national providers compared to international agencies lies mostly in the regional coverage offered (Segbers, 2007, p. 62).

Against the backdrop of increasing digitalization, the availability of global information no longer provides genuine added value for customers. In particular, technical innovations make it necessary to constantly develop new and optimized workflows (with regard to content, editorial, and graphic-technical processing) as well as products (videos, apps, real-time media monitoring, etc.) and services (quality improvements through keywording of information broadcasts, specific training of journalists, etc.) (APA, 2015, pp. 5–16).

News agencies currently generate added value in particular through the organization of news. This still includes the collection of information – from an increasing number of individual sources – checking the accuracy of news (verification), the storage and retrieval of information, the generation of metadata, the clarification of rights for materials used, payment modalities and documentation (Kropsch, 2015). Specific challenges also arise according to media types: Unlike with texts, for example, the presence of a photographer on site and the ideal moment to press the shutter release are indispensable for visual material (especially in sports news coverage) (Segbers, 2007, pp. 66–67). In early January 2022, the PA announced that it would launch a non-fungible token (NFT) photojournalism marketplace, built by blockchain technology provider Xooa. Collectors can thus buy, sell and trade official AP digital collectibles. The NFTs also contain a rich set of original metadata offering collectors awareness of the time, date, location, equipment, and technical settings used for the shot (AP, 2022; APmarket, 2022).

A historically relatively new service of the agencies, which is currently mainly used by non-media customers (for example, PR) and serves publishers with added value offers outside their core business, are moving images or videos. The Reuters news video channel has been widely used for years, while dpa, for example, had for a long time tended to focus on special entertainment video contributions, and is in the process of expanding the area (dpa, 2016a, 2020b). Since 2014, APA has provided Austrian daily newspapers with video portals in technical terms. Financing is to be guaranteed by pre-roll and post-roll ads (APA, 2015, pp. 7, 13). In 2014, the international AP’s extensive video service already contributed 40% of revenues – mainly through profitable sales to TV stations. The importance of moving images, videos, and also live streaming has increased in recent years for the British Press Association (PA), which operates in a highly competitive media market characterized by concentration processes (Pruitt, 2014; Sweney, 2014).

Due to their task of making the added value of the agency’s services visible to third parties, and of packaging and selling services in a way that is appropriate to the customer, marketing and sales play a decisive role in ensuring that the key activities are adequately financed .

2.7 Core Resources of News Agencies

The most important resources of news agencies are their employees and their specific competencies. Intangible resources that are of great importance include software licenses and usage rights. Tangible resources that are needed for business operations are primarily buildings, operating and business equipment, and technical facilities. Financial resources are essential for this and for driving innovation.

The total number of employees varies from agency to agency (mainly due to the different areas of activity) and also according to the structure of the group (i.e., the employees who are directly attributable to the news agency). For example, although Switzerland and Austria are comparable in size, APA employs around 503 people (APA, 2021), while only 174 people (Keystone-SDA, 2022) work for Keystone-SDA. The fact that employees, as core resources, can also be affected by cost-cutting measures became clear in February 2018 at sda, which is run as a stock corporation. Faced with a planned job cut (around 35 out of 150 full-time editorial positions) as part of a restructuring, sda editorial staff went on strike, and important customers also threatened to reduce prices in the event of a drop in quality (SRF, 2018).

The “remaining” share of journalistic employees at the agencies provides information about the agency-specific significance of services that go beyond news services. While only about a quarter of APA’s employees are journalists (APA, 2020), dpa employs at least 60% of its employees as journalists (dpa, 2020a).

According to the extent of their network of correspondents, news agencies are divided into world agencies, international agencies, regional agencies and national agencies.

• Most news agencies fall into the category of “national agency”, which have reporters more or less only in their home country (Schulten-Jaspers, 2013, p. 59). Although historically there have been efforts to operate larger networks of correspondents.²³

• An international agency such as dpa is represented in more than 100 countries worldwide with dpa presences and employs a total of around 1000 journalistic staff on a permanent and freelance basis in the word segment. In addition, there are photographers and others (dpa, 2020a).

• In comparison, the world agency AFP, for example, is present on five continents and has 201 bureaus in 151 countries with a total of around 1500 journalists from 80 different nations and in six languages (AFP, 2020b).

Over the years, technology in particular has exerted a decisive influence on the development of news agencies (Schulten-Jaspers, 2013, p. 65). The central technical innovation at the end of the twentieth century was digitization, which made it possible to jointly process information transfers that had previously been handled by different carrier systems (Dörfler & Pensold, 2001, p. 533).

The first computer systems for news gathering, processing, and distribution came into use in news agencies in the early 1970s. Since the early 1980s, news agencies’ networked information systems can be used by their customers simultaneously for information search, text processing and broadcasting (Dörfler & Pensold, 2001, pp. 501, 511).

Since about 2004 – and also due to the increase in multimedia – the work of the agencies has increasingly been divided according to the Anglo-Saxon model of dividing the work into editors and reporters. The editors or reporters brought their news – first physically, later via electronic editorial systems – to a central newsdesk.

Large rooms or newsrooms have existed at agencies for a long time, but truly integrated, contemporary newsrooms are a development of recent years (Schulten-Jaspers, 2013, p. 108). In integrated newsrooms , all editors work from a central newsdesk – often grouped around it in a ring – on one level. The realization of this model is mostly an architectural challenge, since – depending on the size of the newsroom – a space with 2000–4000 m ² must be available for the newsroom (Segbers, 2007, p. 139).

The editorial systems of the agencies are often specially developed by the agency’s own IT department in cooperation with editorial staff and are constantly refined to adapt them to changing requirements. Modules such as different text and photo formats, agency languages, links to the agency’s extensive schedule, live features such as real-time video services of press conferences, events and general news, etc. are combined in one system. The news agencies’ editorial systems can also become a product themselves (APA, 2015, p. 11; Mecom-news, 2013).

Most larger agencies contractually set quantity limits and/or time delays for those who wish to want to use their services (Segbers, 2007, p. 97). An evaluation of reprints of the agency’s own material and that of its competitors is carried out by so-called “play reports”, which regularly and systematically refer only to newspapers in almost all cases (Segbers, 2007, p. 109).

It is customary, when concluding the corresponding supply contracts, to oblige the newspapers to use the material only with source identification. On the other hand, no news agency will terminate a customer’s contract if this rule is violated (Segbers, 2007, p. 109).

Legal action is taken against the illegal use of agency material by non-customers. To counteract this, dpa, for example, offers individual licenses for time-delayed use of agency material (news, photos, graphics) for publications that do not require a regular supply of content. Published texts are protected by copyright and may only be used with explicit permission. In the event of illegal use, agencies reserve the right to take further legal action and usually demand compensation for damages (dpa, 2016d).²⁴

Less clear is the copyright permissibility of quoting agency reports if they have already been published by third parties (dpa, 2016d).²⁵ Text messages can only be protected if they are copied exactly. Illegal copying is more difficult with visual information such as images or videos, which is why agencies are increasingly pushing them as information carriers.

Digital licenses and the efficient control of their compliance or illegal use are also gaining importance. As with news, license models of selected image sources etc. are also distributed as packages (APA, 2015, p. 13).

In addition to this, monitoring tools are relevant that help to observe and analyze the complex stream of content that is distributed digitally.

Due to numerous necessary technical innovations that require rapid development and adaptations of existing services beyond traditional areas of activity, cooperation with start-ups is also essential. For example, the American AP invested in a startup called Sam, which promises to keep an eye on trends in social media (Neufeld, 2016) .

2.8 Cost Structure of News Agencies

The aim of operating news agencies – today as 120 years ago – is to provide an independent, balanced and reliable news service that has a cost-reducing effect on their media customers (sda, 2015, p. 58). The average financial outlay that a newspaper, for example, makes for subscribing to agency services is in the single-digit percentage range, averaging less than 5% of editorial costs (Segbers, 2007, p. 157). According to Zschunke (2000, p. 56), this figure was around 6% in Germany in the 1990s.

On the part of the news agencies, the following operating expenses are incurred for the provision of services: personnel expenses, news procurement, transmission, technical expenses, material expenses, office supply costs and other operating expenses such as administration (sda, 2015).

Concrete key business figures are only known from a few agencies. Relevant data are only available from the major international agencies and the group of national independent agencies in Europe. In the DACH region, Keystone-SDA and the dpa GmbH (voluntarily) publish an annual report. Since 2019 at APA, the annual report is available for the cooperative members and an excerpt with the most important figures via press release.

Personnel costs account for the majority of total operating costs (e.g., about two-thirds of operating expenses). Direct expenses for agency operations (technology and information provision) account for around one fifth of operating expenses. The office supply costs (rent, etc.) are comparatively low at around 3–4% of operating expenses, and advertising costs are also negligible (0–2%) due to the B2B structure. Further costs arise from other expenses (such as administration) (APA, 2020; Keystone-SDA, 2022).

The cost drivers include, for example, major sporting events such as the World Cup or the Olympic Games in the case of news procurement, IT and video-projects in the case of technical expenditure, and revenue-driven fee expenses (e.g., provisions) or ancillary wage costs in the case of personnel expenditure (sda, 2015; dpa, 2022).

With regard to the costs of news production, those agencies that produce originally in English or Spanish have a certain advantage, as the services can be sold in large parts of the world and no costs are incurred through editorial translation work – as is the case with French or German (Segbers, 2007, p. 174). In Switzerland, on the other hand, news production in the three national languages German, French and Italian results in higher costs (Keystone-SDA, 2022).

A major challenge for most news agencies is the increasing economic concentration process of the media market. It is true that media groups with several brands have emerged in most Western countries in recent decades, from daily newspapers to magazines to pure online media, but mostly under the umbrella of existing media providers. Their goal is, among other things, to create so-called synergy effects, which are also desired when purchasing agency material. This means that some agencies in the media sector are dependent on a few dozen major clients. If one or a handful of these major clients terminate their contracts, the agency runs into turbulence or even distress. This is due to the fact that the costs of news procurement are largely fixed costs, i.e., they are incurred regardless of sales (first copy business) and thus remain unchanged or increase while sales slump (Segbers, 2007, p. 155) .

2.9 Revenue Opportunities for News Agencies

Ownership structures in national media markets are concentrating, and with them, to some extent, the number of news agency owners and customers. Maintaining the basic news service despite low profitability is essential for news agencies. This is achieved through additional business areas and innovations (Grüblbauer et al., 2021, p. 15).

Currently, three forms of financing can be distinguished for news agencies, which are also used in combination: (1) independent funding (about 20 out of 150 agencies worldwide succeed in this) – traditionally from the core news business, but increasingly through related businesses; (2) public funding for public value content; or (3) direct government management or ownership (predominant form).

For agencies that are independent of the state, the question of funding is a key issue, since their editorial independence ultimately presupposes economic independence. For this type of agency, remoteness from the state and government is almost a kind of dogma. Therefore, funding must both pay for the cost of providing key activities and preserve independence from third-party influence. About a quarter of agencies worldwide are independent of the state, including agencies such as Reuters, AP, dpa, and APA (Vyslozil, 2014b). With few exceptions, profit orientation plays no role at state agencies or is not an issue.

Since news agencies have a high proportion of fixed costs (first copy cost business), the success of independent financing through the core business, the sale of news, depends above all on the size of the sales market. For example, global agencies such as AP or Reuters have large sales markets. The largest market for news agencies in Europe is Germany.

Scaling existing business areas is often difficult in small markets and only possible if services are offered globally or nationwide, across different media, or at least for more than one company. A precarious financial situation calls both independence and innovative strength into question and is therefore something all agencies try to avoid (Grüblbauer et al., 2021, p. 16).

The growth limits of agencies in terms of news sales in the media market are mainly set by the following framework conditions:

• Agencies are not allowed to market ads or ad-like formats. Originally, their only source of revenue was, and to some extent still is the sale of their content. The advertising business, so essential for all other media as a substantial source of revenue, remains unavailable to news agencies (Vyslozil, 2014b).

• In addition, the number of potential customers as well as the reach and circulation of traditional media is continuously decreasing.

• Social media offers favor an unbundling of news media offers in order to continue to reach recipients. News content is distributed through these networks by external providers purely financed by advertising.

• Finally, news media are increasingly being replaced by media with less focus on background reporting (tabloid press, private TV, etc.).

• Text-based news content is a difficult asset to protect unless it is distributed completely unaltered.

Concrete economic key performance indicators from annual reports on how these circumstances affect the economic success of the agencies are only available from the large international agencies and the group of national independent agencies in Europe. The majority of them have positive annual financial statements, albeit mostly with a single-digit return on sales (Vyslozil, 2014b).

In general, the importance of the central revenue sources can be differentiated according to media categories: The revenue share of daily newspapers in the total revenue of news agencies has been declining for years, since the user fees are based on the circulation figures of the newspapers. In this respect, the classic, and generally most important market for news agencies, is a shrinking market (Segbers, 2007, p. 89).

The agencies’ second major source of revenue is usually the TV and radio market. Despite their large number, however, the small private broadcasters are of less importance for the revenue situation of news agencies as a whole than public radio and television stations, for which agency material serves as the basis for their news broadcasts alongside the reports of their own correspondents (Segbers, 2007, pp. 94–95).

In the case of Internet customers, portals of large online companies are to be distinguished from the online presences of media houses. Online presences of media companies are usually already customers of the agency anyway due to their “original medium”. Here, the news agencies regularly do not succeed in negotiating considerable amounts for this additional use, since the use is usually included in the overall contract (Segbers, 2007, p. 98). The extent to which contracts for online use are covered by print contracts is currently being discussed in agencies and is often a case-by-case decision. In principle, the revenues in this area suffer from the fact that the underlying agreements began at a time when the online potential was not yet so obvious (Segbers, 2007; Trankovits, 2015).

In the case of online portals , there are only a few larger providers and, overall, they can be compared with a small to medium-sized newspaper in terms of agency turnover. More difficult than the acquisition of agency content by internet portals with their own journalistic claim, such as the Huffington Post or GMX, is the use of agency content by the search engine Google. At least AP concluded a contract on exploitation rights with the Internet giant in 2010 – preceded by a lengthy dispute. Other agencies such as dpa are trying to profit indirectly from the use of content by the search engine group by participating in the “Digital News Initiative” (Ostrow, 2010). Google and the French news agency Agence France-Presse (AFP) concluded an agreement on the remuneration of ancillary copyrights under French law for a term of five years at the end of 2021 (Bünte, 2021). Google’s “News Showcase” product and licensing program, launched in October 2020 and rolled out to around 1500 publications in more than a dozen countries by mid-2022 (Horizont, 2022), does not include news agencies.

There is also collaboration with social media providers. For example, editors at Deutsche Presse-Agentur (dpa) have curated the content of the Facebook News section in Germany since April 2022 (Die Presse, 2022).

In contrast to news, the photo and image business is profitable for news agencies primarily in the context of so-called secondary exploitation, such as marketing to book publishers, magazines, advertising agencies, calendar publishers and others. In this field of business, news agencies come up against large competitors, such as the two US giants Getty and Corbis, but it is nevertheless a growing market (Segbers, 2007, p. 69). At dpa, for example, image marketing through its subsidiary Picture Alliance is very important in terms of revenue – it contributed around €2.5 million in surplus in 2019 (dpa, 2020a). Problematic for news agencies, however, is the fact that many media rely on different platforms such as Fotolia (Integrated into Adobe Stock in 2019) as an alternative to classic “stock image” providers, whose approach is to generate mass from a pool of diverse photo producers (Fotolia, 2016; BVPA, 2019). News agencies, on the other hand, also see their service in filtering and curating the multitude of available images according to quality criteria (Ürük, 2018).

Today, a non-subsidized news agency could hardly survive on media costumers alone. News from independent agencies is therefore also sold to those customers who have no intention of publishing it or publishing it in a different way than it was the case with classic media, for example in the areas of corporate publishing or content marketing, i.e., in target group-specific publications, such as for customers and employees. This market is theoretically unlimited, as it includes every company in the world, every interest group or even every political entity. However, the revenues to be generated there are rarely of the magnitude of media revenues. In the case of public service constructs such as the AFP or state agencies, the main sources of revenue are in political areas. In the case of independent agencies, the state share probably does not usually take up much more than 5% of their budgets (Segbers, 2007, pp. 100, 104).

On average, “modern” news agencies only generate about 40% of their revenues from classic agency services, while they already generate about 60% of their revenues from their other services on average (Vyslozil, 2014b). In the case of the Austrian APA, the share of non-member business was already comparatively high in 1972 compared to other national agencies in Europe. Due to the economic conditions in Austria, APA already generated 40% of its total revenue from non-members in 1972, while other European agencies at the time covered 75–80% of their expenses from their core business – i.e., supplying news to media institutions. The background to this is that it lacks a correspondingly large market in its core business in Austria and is unable to raise prices accordingly for its media customers, who are also cooperative members. (Dörfler & Pensold, 2001, p. 487) While the traditional news service generates about a quarter of APA’s revenues, a more traditional news agency such as Keystone-SDA, which is much more focused on its core news business, has for a long time generated about 60% of its total revenues with its basic media service. At the Austrian APA, every fourth euro is already earned with IT and 30% revenue share is generated by information management (APA-OTS and APA-defacto) (APA, 2020; sda, 2020).

A difference also arises from whether an agency offers and sells its services in the domestic or in foreign markets. Outside the home markets, agencies are flexible in their pricing; here, for example, they do not have to meet the strict B2B requirements of the home market, but can theoretically also address end customers directly. The few agencies that maintain international sales at least try to develop prices in line with the market abroad. However, there is hardly any information on the relationship between revenues from domestic and foreign markets, since only a few agencies – only global and international agencies – generate any foreign revenues at all (Segbers, 2007, pp. 156–165).

In the case of cooperatively organized agencies, the focus is usually on the cost recovery principle rather than on profit maximization. The pricing leeway is subject to the approval of the members, is therefore usually limited and has a dampening effect on the price (Segbers, 2007, p. 162). For example, while dpa did not increase the price of its basic service for many years²⁶ and even discounted it,^{27 27} AP has been continuously increasing its prices since 1971 (Segbers, 2007, p. 156).

The question of how to portion news agency services is one of the most exciting in news agency finance ever. Traditionally, news agencies rely on subscription models of the entire basic service. All of the major agencies, at least, do not usually sell news texts individually, but within subscriptions with minimum contract terms of one year or longer (Segbers, 2007, p. 162). None of the agencies calculates according to the number of news printed. If news are deliberately written with a view to achieving the highest possible print quota, there is a temptation to take too much account of sales interests. In the case of newspapers, radio and television, it is above all the reach that plays a role in pricing. On the Internet, it is visits, page impressions, or comparable figures (Segbers, 2007, p. 159).

If newspapers have to pay a fixed amount per unit of paid circulation, smaller newspapers in particular benefit. If linear prices are applied above a certain base price or if wholesale discounts are applied, newspapers with higher circulations benefit. Linear pricing models consequently presuppose solidarity among members – with the news agency and with each other. This model is therefore easier to implement if newspaper landscapes are not characterized by concentration processes – as is currently the case (Segbers, 2007, p. 158).

In order to better serve special needs and also niche markets, the price bundling of the traditional subscription model (mixed bundling) is varied. Pure bundling of the offer (spin-off model) allows customers to subscribe only to certain partial services of the news service. However, if the total package were to be based on the prices of modularly subscribed services, this would be significantly more expensive than the flat rate for the total package. Unbundling (drag-in model), on the other hand, allows individual services, such as video services, to be decoupled and offered as separate modules, albeit with little success so far, as a result of which some of the decoupled services have been included in the overall offer again as added value.

In general, the pricing policy of news agencies varies widely: in some cases, there are non-debatable price tables that prescribe the price to the cent according to certain criteria, such as reach, but the calculation ranges all the way to very free negotiation, especially for non-media customers.

A major challenge is to find the right balance between pricing for declining traditional media and digital media that are gaining in reach. At the same time, billing methods for cross-media offerings must be found. Among other things, a so-called total audience model is currently being discussed, which takes into account all media channels in the sense of a total reach .

3 Summary

Adjustments to the business models of news agencies, which operate predominantly in the B2B business, are taking place at very different speeds depending on various external factors. Some trends that can nevertheless be derived for the entire industry are summarized in the following paragraphs and in Fig. 3:

Fig. 3

Business model of news agencies

Digitization has intensified the global exchange of information. Today, news agencies therefore create central customer benefits less through the mere availability of information and more through information services and the infrastructure for the exchange of information. Services for the organization of information, such as the collection from different sources, verification, storage, metadata, rights clearance or monitoring, are becoming increasingly important for customers.

With regard to the core partners, the willingness to cooperate – also historically grown – is high. There are various reasons for this: due to the contractually globally regulated networking of practically all news agencies as a unique selling point of the agencies, their ownership structures, the interdependence of the agency and media industries, as well as the focus on B2B customers. The network of potential partners is constantly expanding and, in addition to other news agencies and media companies, includes various other companies and organizations as well as start-ups, educational institutions, etc.

National responsibilities of individual agencies are contractually defined. The smaller the number of providers in an agency’s sales market whose publications are based on information services, the smaller the number of potential flat-rate buyers of the comprehensive basic service, the more agencies are dependent on non-media customers to secure sufficient funding. The interdependence between media clients and agencies nevertheless remains high, not least because of the strong ties in the ownership structures of many agencies.

In order to enable a global, smooth exchange of news, news agencies, media and manufacturers of IT systems have been agreeing on common standards (IPTC) for over 50 years and are continuously developing them further. B2B portals, through which individual usage and access rights can be controlled, form the interface between customers and the various services of the news agencies. The services offered, traditionally text-based, have expanded considerably in terms of multimedia.

In order to be able to offer availability, organization and exchange possibilities of news efficiently, the agency services from creation to monitoring of the news flow must be constantly adapted to new requirements and developed further. Marketing and sales staff, who make the added value of news agency services visible in order to sell the products to customers, are becoming increasingly important, especially in highly competitive agency sectors: sales to non-media customers.

The most important resources of agencies are of an intangible nature. Agency employees increasingly need IT know-how in all stages of the agency’s value chain, in addition to the traditionally important journalistic skills. Essential assets are also licensing and usage rights.

The resulting costs are strongly oriented toward fixed costs due to the production of first copies, which is necessary irrespective of sales. In addition to major news reporting events, IT projects are the main cost drivers. The agencies find themselves in a dilemma, since on the one hand, the provision of extensive news reporting is expected, but on the other hand, the willingness of customers to additionally participate in special expenses, such as for new video formats with 360° perspective or similar, is not increasing.

Only about 40% of the revenues required to finance these activities and innovations are now generated from media customers. Especially in the case of daily newspapers, the traditional main customer of the classic basic service, the revenue potential has decreased due to the circulation and reach-oriented pricing policy. Internet customers cannot (yet) compensate for the decline in revenues from traditional media customers.

The revenue from “news-related” services for non-media customers is therefore becoming increasingly important, as is the further development of technological solutions, for example, to optimize infrastructures for digital news exchange (Ürük, 2018). Sufficient funding – not tied to influence or strictly separated from the agency core business – ensures not least editorial independence, which is an essential intangible value of news agencies.