By the end of 2015, Bertelsmann will close its German-language book club and book retailing operations, which were the cornerstone of the company's success in the post-war period.
"The business model of book clubs is old and has been largely superseded by online sales, where Amazon is the market leader," Sarah Simon, senior media analyst with Berenberg Bank in London, told the Wall Street Journal.
In the 1950s, under Reinhard Mohn, Bertelsmann's Lesering (Reading Ring) sold discounted books through the mail and in 1964, the first retail store opened. By the 1990s, there were more than seven million book club members and more than 300 stores in Germany, only 52 of which remain.
Bertelsmann has, of course, diversified, and now owns Random House and a 53% share in Penguin Random House, among other ventures. "Bertelsmann has come a long way from bookselling," Bettina Deuscher, a media analyst at Landesbank Baden-Wuerttemberg, told the Journal. "The bulk of its revenues today come from TV, publishing and business services. The company is trying to gain market share as media become more digital and advertising revenues shrink."
