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German bookseller, publishing operation and media group Weltbild filed for insolvency on Friday January 10th, with reports on Reuters and elsewhere citing both competitive pressure from Amazon in Germany and failure to obtain new financing, after its owners failed to agree on new funding arrangements. Fortunately, the actual bookstores in the bookstore chain Hugendubel – Germany’s second largest – which Weltbild part-owns, will be unaffected, according to Reuters, but the bankruptcy terminates a turnaround strategy that involved shifting to more internet-based businesses, albeit in the face of sliding sales. Business will continue for the present while the court administrator looks for a more viable restructuring plan.

WeltbildThe controlling shareholders of unlisted Weltbild were 14 dioceses of the Roman Catholic Church in Germany, including the Association of German Dioceses, and the Soldatenseelsorge Berlin, the church’s military welfare organisation. Disagreements among them about how to finance the business through its restructuring plan ultimately led to its demise. Weltbild claimed earlier to be Germany’s second largest online bookseller (presumably after Amazon) so its business may have a future – in other hands. Amazon has its own reputational issues in Germany, but Weltbild’s own financing concerns rather than the lower sales appears to have been the more significant factor in its downfall. And that points to issues in the holding structure, in the actual degree of freedom in the market for control of German and other European companies, and in the true level of openness and development in German business and society.

Amazon may or may not be the culprit in Weltbild’s demise, but it’s hard not to assume that a media company owned by a confederation of Catholic dioceses simply has no place as a major presence in a 21st-century media landscape. How can such an entity not run into competitiveness issues when up against multinational competitors like Amazon? How can its owners not negatively influence its behavior at times – or, as actually happened, exercise less than optimal business judgement about its strategy and future? And how can their values not finally affect it at some level?

The problem was exactly illustrated by an incident earlier in 2013 when Weltbild announced that it would no longer be carrying books from Vancouver-based Icon Empire Press, which specializes in gay erotica. As quoted in Vancouver online news source Straight.com, Weltbild told Icon Empire that: ”As a company owned by the Catholic church of Germany our leadership is devoted to rather traditional values und [sic] thus has decided not to sell your titles.”

So there you are: Weltbild was in fact acting as an agent of censorship on behalf of its ecclesiastical owners. Whether or not that was the intention, it certainly was the result. Hard to regret its demise under the circumstances.

 
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