Chapter 69: Competitive Advantage
First and foremost, the Paris News has no aristocratic background.
The owner of the newspaper is a businessman from Marseille who inherited his family business and is the sole shareholder.
Secondly, the business performance of this newspaper is not very promising. It has applied for tax payment extensions twice this year, so it is likely willing to sell.
Lastly, and most importantly, the Paris News owns a very large printing workshop. It seems they tried to run a side business of printing for other newspapers, but evidently, this endeavor did not bring much profit.
Joseph immediately decided that this was the one.
If he wanted to step into the publishing industry, the most direct way was to acquire an existing newspaper.
He screened a few alternatives, and by the time he finished, the sun was already setting.
...
Early the next morning, Joseph headed straight to the Paris News headquarters in the northern part of Paris to discuss the acquisition and personally inspect the newspaper’s operations.
The street where the Paris News is located was not particularly bustling, but a very large building by the riverside stood out conspicuously.
The building’s main entrance bore a sign that read “Paris News.” Even from a distance, one could hear the noisy and busy sounds from within. Behind the building, black waste water was continuously being discharged into the river.
Joseph took a look around the newspaper office. The massive building housed the printing workshop, which contained seven printing presses.
In the workshop, craftsmen pulled the handles of the printing presses, which were over a meter long, pressing blank sheets of paper onto the printing plates below.
When they raised the handles again, a freshly printed newspaper emerged.
Dozens of workers bustled about, adding ink, drying papers, and moving stacks of prints. Their movements were quick and precise, clearly showing their years of experience.
After inspecting the storeroom and the editorial office, Joseph had a rough understanding of the overall situation of the newspaper and was quite satisfied with what he saw. He casually stopped an editor and expressed his wish to meet the owner of the newspaper.
The editor quickly led them to an office on the second floor of the building and pointed to a slightly plump middle-aged man wearing a dark green vest and glasses. “This is Mr. Denico.”
Seeing visitors, Denico immediately stood up, smiled, and greeted them politely. “Welcome, esteemed sir. May I ask if you’re here to place an advertisement or to have something printed?”
Joseph disliked small talk. After returning the greeting, he went straight to the point: “Mr. Denico, I’m interested in purchasing your newspaper.”
Denico immediately sat back in his chair, waved his hand, and said, “Please leave. It’s not for sale.”
When Joseph didn’t move, he raised his voice. “Go, or I’ll have you escorted out!”
Joseph glanced at Eymond and thought, “According to the usual movie script, shouldn’t you step forward now and say, ‘How dare you! Do you know who stands before you? The Crown Prince!’”
But Eymond clearly had no intention of speaking up.
Joseph had no choice but to pretend he hadn’t heard and continued, “Can you tell me why you don’t want to sell?”
Denico mumbled, “I promised my father I’d take good care of this newspaper.”
Joseph sighed, took a seat across from him, and smiled. “I’ll offer 150,000 livres for the purchase. You can still manage the newspaper afterward.”
He had brought an accountant with him, who had roughly estimated the value of the newspaper earlier. It was worth about 120,000 to 140,000 livres, with most of the value tied to the property and the printing workshop.
Denico was stunned. The newspaper had been losing money for over a year, and he thought selling it for a little over 100,000 would already be a good deal. He didn’t expect this young man to offer such a high price.
He hesitated internally but still shook his head. “No… I promised my father…”
Joseph nodded. “160,000 livres.”
“But…”
“170,000. Final offer.”
“All in one payment?”
“Yes.”
“170,000 livres… sir, are you certain… you want to buy my newspaper?”
“Yes.” Joseph gestured for the accountant to show Denico proof of his 170,000 livres in bank assets.
Denico stared into Joseph’s eyes, confirming he wasn’t joking. After struggling for a while, his shoulders suddenly relaxed, and he displayed a resolute expression. “Oh, fine. It’s yours.”
He thought to himself, “Dear father, you can’t blame me. His offer is simply too generous…”
Joseph’s lawyer immediately took out the pre-prepared contract for both parties to sign. The accountant then accompanied Denico to the bank to process the payment.
Given the inefficiencies of banks at this time and the substantial amount involved, the procedures took over two hours. The full amount would take another three days to clear completely.
On the way to the bank, Denico had already learned of Joseph’s identity from the accountant. He felt as though he’d won the lottery—not only had he sold the newspaper for a huge sum, but he had also forged a connection with the Crown Prince.
When he returned, Denico was incredibly respectful, repeatedly assuring Joseph that he would manage the newspaper well for the Crown Prince.
Joseph encouraged him and asked, “How was the newspaper’s profit situation before?”
Denico stammered, “You know, people nowadays prefer gossip and sensational news. Our focus on freedom and ideals doesn’t sell as well… This year, we lost 1,200 livres, though we did earn a few hundred in the first half of last year.”
Fearing that the Crown Prince might reconsider, he quickly added, “Actually, in previous years, when business was better, we used to earn over 1,000 livres annually.”
Joseph nodded. “I’ll give you an annual salary of 1,000 livres, plus 5% of the newspaper’s total profit as a bonus.”
He had acquired the newspaper entirely to win the battle of public opinion, and the Paris News would serve as his important base of operations. Tying the management’s interests to the newspaper’s performance was crucial to motivating them.
Denico couldn’t believe his ears. He no longer had to worry about the losses of the newspaper, and now he’d receive such a generous salary. The Crown Prince was truly a godsend!
Overwhelmed with gratitude, he repeatedly swore his loyalty, promising to do everything possible to ensure the Crown Prince’s satisfaction and to restore the newspaper to profitability and prominence as quickly as possible.
...
When Joseph mentioned giving the newspaper’s management and key technical workers a 20% pay raise, Denico quickly advised against it. “Your Highness, the newspaper is still losing money. It’s unwise to increase expenditures so significantly.”
Joseph smiled, noting how diligent this man was in safeguarding his finances.
“It’s fine. The business will improve soon. Just do as I said.”
Joseph didn’t dwell further on salaries and instead turned to more pressing matters. “Mr. Denico, how many skilled plate-making craftsmen are in the workshop now?”
At this time, printing technology was still relatively primitive. The text was printed using movable type made of lead blocks, which was relatively inexpensive.
Illustrations, however, required copperplate engraving, where craftsmen painstakingly etched designs into copper plates. These plates were then used alongside movable type or separately for printing. This labor-intensive process made engraving the most expensive part of the entire printing process.
Denico replied without hesitation, “Your Highness, the workshop currently has five engraving craftsmen, three of whom have over ten years of experience and are somewhat renowned in the copper guild.”
Joseph nodded. “Please prepare some white chalkstone slabs—fine-grained ones. Cut them to the size of drawing boards and polish one side smooth. We’ll need about 40 pieces. Have the three experienced craftsmen bring them to Versailles; I have tasks for them.”
Chalkstone, a type of limestone, was widely used in construction and was inexpensive.
Denico, puzzled, asked, “Chalkstone? Are you planning to repair floors?”
Joseph smiled faintly and shook his head. “It’s for lithographic printing.”
Denico’s eyes widened. “You mean printing with stone slabs?”
“Precisely.”
Joseph understood that to dominate the publishing industry, superior content alone wouldn’t suffice. He needed to tackle costs, distribution channels, and other factors, leaving competitors with no chance to fight back.
“My newspaper will feature brilliant content and sell for only 1 sou, perhaps even just 8 deniers. Meanwhile, your ordinary newspaper costs 4 sous. How do you expect to compete with me?”
In terms of cost control, lithographic printing—or stone printing—was a game-changer.
With cheap materials and simplified plate-making processes, the cost of lithographic printing was only one-fifth or even one-tenth that of copperplate printing.
The other cost-reducing innovation was the use of wood-based papermaking. If mass production were achieved, it could cut paper costs by 70%. Historically, this technique even sparked a revolution in the British newspaper industry.
With these two technologies, Joseph was confident he could slash newspaper prices to less than a fifth of current levels and still turn a profit.
Of course, wood-based papermaking had higher technical requirements, so success wasn’t guaranteed. But lithographic printing was relatively simple, and experienced craftsmen could quickly master it.
Joseph then instructed Denico on several immediate tasks, such as increasing staff, stocking more ink and paper, and designing a new layout for a newspaper titled News and Pictures.
After roughly organizing the newspaper’s affairs, it was nearing sunset. Before leaving, Joseph casually asked Denico, “Are there any large paper mills near Paris?”
Denico immediately pointed northeast. “There’s one in Saint-Antoine. Your Highness, half of Paris’s paper supply comes from there.”