Foreign investment in our region: a case study on the expansion within the EU

379 F FO OR RE EI IG GN N I IN NV VE ES ST TM ME EN NT T I IN N O OU UR R R RE EG GI IO ON N: : A A C CA AS SE E S ST TU UD DY Y O ON N T TH HE E E EX XP PA AN NS SI IO ON N W WI IT TH HI IN N T TH HE E E EU U Láng Esz e Facul y o Economics and Business Adminis a ion, Uni e si y o Deb ecen, Hunga y E-mail: esz e [email protected] The majo i y o capi al low is p o ided by he capi al in es men o ansna ional companies which a e e y p o i -o ien ed as a esul o hei a ional economic ac i i y. An excellen example o he a ional ans-na ionalisa ion p ocess cu en ly occu ing in he wo ld economy is he eas wa d expansion o he Aus ia-based In o m Media g oup. A e he changes in he poli ical sys em he company s a ed se ious in es men s, i s in Hunga y and la e in Romania, p ima ily in he ield o p in ed and online egional media. This pape examines he case o his i m o he expansion wi hin he EU. The majo i y o capi al low - apa om some cha i able conce ns - is p o ided by he capi al in es men o ansna ional companies (TNC’s) which a e e y p o i -o ien ed as a esul o hei a ional economic ac i i y. We ace di e en s ages o ma ke pene a ion du ing he in e na ionalisa ion o company p oduc ion. A company gene ally en e s o eign ma ke s by expo ing a p oduc which is gene ally success ully in he domes ic ma ke ; la e he dis ibu ion is helped by he c ea ion o local wa ehouses. The nex s age is he cons uc ion o assembly plan s, pe haps in co-ope a ion wi h local companies. Finally a local subsidia y is c ea ed wi h a wide p oduc ion ac i i y and highe alue-added h ough o eign in es men . TNC’s pene a e o eign ma ke s o gain an ad an age h ough he abo e p ocesses o by lea ing ou ce ain s ages and sea ching o a ou able possibili ies. In he Middle-Eu opean coun ies one o he e icien ools o a apid con e gence and he mode nisa ion o he economy include he g adual libe alisa ion o he p oduc and se ices ma ke and he admission o o eign wo king capi al in o he coun y. The p esen s udy pape aims a he eas wa d expansion o he Aus ian based In o m Media g oup: i examines how i s ope a ion and beha iou can adop he cha ac e is ics o he p ocesses in wo ld economy. A e he changes in he poli ical sys em he company s a ed se ious in es men s, i s in Hunga y and la e in Romania, p ima ily in he ield o p in ed and online egional media. This expansion is con inuing oday, and wha is mo e, he plan o pene a e o he ma ke s in he egion is cu en ly in p ocess. An openly s a ed aim o he company conce ning he eas wa d expansion was he acquisi ion o new ma ke s and he c ea ion o a leading posi ion in he ield o egional media. The Aus ian Vo a lbe ge MedienhausGmbHen e ed he ma ke o Hunga ian egional p in ed media in 1991 and i acqui ed he coun y newspape s o Észak-Magya o szág, Kele -Magya o szág and Hajdú- biha i Napló a a ende . The in es o ca ied ou p ominen in es men s: i buil i s own p ess p in ing he h ee egional daily pape s in Deb ecen. In 1993 i se up an own dis ibu ion ne wo k and by 1996 i had made i s own billing sys em. The sales igu es howe e showed a signi ican 20-30% d op, and o 1996 he i m pos ed consolida ed losses o mo e han one billion Fo in s. The company appoin ed a new managing di ec o o deal wi h he c isis, who began a signi ican es uc u ing p og amme: a d as ic inancial es uc u ing, he o ced edundancy o 100 wo ke s, and he closu e o 13 si es. In 1998 one o he membe s o he in es men g oup secu ed 100% o he pa en company. In acco dance wi h he o wa d planning s a egy, he company bough a new p in ing machine (UNIMAN) and ins alled a new compu e en i onmen . The i s aim was o win back los ma ke s, and he abso p ion o new publica ions which damaged he in e es s o IM. They bough up he publishe s o ‘Ú on’, which had appea ed in Deb ecen as an al e na i e newspape . In Nyí egyhaza hey i s bough and hen closed down ‘Új Kele ’ and in 2002 abso bed hei compe i o in Miskolc, he ‘Déli Hí lap’. In 1999 he company con inued i s se ious in es men p og amme, eno a ing he o ices o he Kele -Magya o szág and he Észak Magya o szág. The ou ope a ing companies we e me ged in o one, and hus In o m Media was bo n. O e he whole a ea o hei ope a ions hey changed o he compu e -based Hubbuch sys em. In 1999 he company eco ded i s i s p o i able yea . In 2000 he ans o ma ion o he company’s news ga he ing and edi ing sys em was comple ed. Linked o his in June 2000 he Vasá napi Újság (Sunday Newspape s) we e launched (Vasá napi Észak, Vasá napi Napló, Vasá napi Kele ). The company opened i s i s egional o ice, and he Hajdú Online in e ne po al was s a ed. The p o i s, now a a signi ican le el in e na ionally, allowed he company o con inue wi h u he expansi e plans o es uc u ing bo h domes ically and ab oad. In Feb ua y 2001 he o he wo coun y dailies’ in e ne po als – Bo sod Online and Szabolcs Online - we e launched. Toge he wi h he es ablishmen o he Miskolc company headqua e s, he Call Cen e was se up o p o ide elema ke ing se ices o all h ee coun ies. 380 The publishe began i s eas wa d (Romanian) expansion in 1999 wi h he launch o he Baza Biho ean ad e ising publica ion. Two yea s la e i bough he egional newspape s, he Biha i Napló (a Hunga ian language publica ion wi h a ci cula ion o 12,000) and he Ju nal Biho ean (a Romanian language publica ion wi h a ci cula ion o 8,000). The ans o ma ion o he Romanian company was also s a ed. In 2002 in Hunga y he company bough he o he Miskolc daily, he Déli Hí lap. I also opened i s i s egional o ice in Bo sod-Abaúj-Zemplen in Tiszaúj á os. The eno a ion o he Hajdú-Biha o ices in Deb ecen was also begun. On he Romanian side he es uc u ing o he publica ions in Nagy á ad begun ea lie was comple ed: he o ices hey had acqui ed we e me ged and p o ided wi h new echnical equipmen . In Hunga y in 2003 i was necessa y o e-equip he p in ing p esses. A new egional o ice was opened in Kazincba cika. In his yea he ea lie plan, ha all dailies should be accessible on-line, was achie ed. An edi ing o ice was es ablished in Budapes . A new daily was launched on Ap il 17 h in Temes á , in Romania, en i led Ju nal Bana en. A he same ime he cons uc ion o he Temes á p in ing p ess was begun, eaching comple ion in May 2004. Following he model o he Hunga ian Tipp ee shee , he Romanian Pon was launched. In Oc obe he Romanian expansion was con inued, wi h a new daily – he Timpul, based in Resi a – coming on o he ma ke . Mo e plans eme ged o he acquisi ion o daily and Sunday pape s. La e he daily ee shee s in A ad and Temes á (A ad Exp es, Timis Exp es) we e launched. A p esen he Romanian subsidia y is esponsible o se en dailies in six coun ies. In Nagy á ad and Temes á small-ad pape s (Baza Biho ean, Publi im) we e launched and ad e ising o ices opened. Following he Hunga ian model h ee Romanian news po als (TION, BIHON, ARADON), and one job- inding po al (BIHORJOB) we e launched. Online ac i i ies con inued o expand in Hunga y om 2004. The No h-Eas e n egion’s la ges small-ad in e ne po al appea ed as ONLINEAPRÓ, he online e sion o he ou coun ies leading small-ad newspape s (Bo sodi Ap ó, Hajdú Ap ó, He esi Ap ó, Kele i Ap ó). This po al con ains app oxima ely 50,000 new ads e e y week om he ou coun ies. Now, 35% o ad e isemen s a i e ia he web. In 2005 se e al o he e ical po als we e se up: job po als (hajdujob.hu, bo sodjob.hu, szabolcsjob.hu), eal es a e po als (bo sodlak.hu, hajdulak.hu, bo sodlak.hu) and used ca po als (szupe au o.hu). Visi ing numbe s show a mon hly inc easing end. In 2005 a u he ad e ising ee shee , he weekly Fu á , wi h i s ci cula ion o 120,000, was bough in Szabolcs-Sza má -Be eg Coun y. In Janua y 2005 wo publica ions we e bough in Hajdú Biha coun y (in Deb ecen wi h a ci cula ion o 80,000, and in he Zemplen wi h a ci cula ion o 30,000), while in Feb ua y 2006 he Szabolcs-Sza má -Be eg coun y Szupe in o (ci cula ion 70,000), and in July 2006 he Dél- Bo sodi Szupe in o (ci cula ion 25,000) in Bo sod-Abaúj-Zemplén Coun y also came unde he company’s con ol. The es ablishmen o he O adea Se ice Cen e (OSC) and Call Cen e (CC) in O adea, Romania in 2005 esul ed in he ac ha he impo ance o he CC in Miskolc ell behind, i s ope a ions we e g adually cu back and i s ole was aken o e by he uni in O adea. The O adea Se ice Cen e is equipped wi h s a e- o - he-a echnology. The in es men has gene a ed esul s compe i i e on a global scale as well. A he momen he In o m Media G oup owns almos 40 newspape s, 10 websi es and 2 adio s a ions in Aus ia, Hunga y and Romania. (Fu he mo e, in 2005 i acqui ed 100% s ake in he Ge man Quoka Ve lag GmbH, which publishes 20 weekly pape s.) The company’s o ganisa ional s uc u e is cha ac e ised by sho decision making ou es be ween he owne , he execu i e and he senio managemen . The aims a e o de ine accu a ely he clea o ganisa ional s uc u e, he esponsibili ies, he ope a ional asks and o ensu e comple e anspa ency bo h o he owne and o he senio managemen as well as o he employees. Decisions a e made a he lowes possible le el. By moni o ing he success ul elemen s o he compe i o s’ cou se o business, he so-called one- o- one-copy echnique is applied, which means he di ec adop ion o me hods ha ha e p o ed o be e icien . The company is pleased o employ junio people a he beginning o hei ca ee s. The young, alen ed employees ela i ely soon ha e he chance o p o e hei compe ence, and hey can ge senio posi ions i hey ha e he necessa y skills. The company is he bigges and mos mode n pool o media and ad e ising consul an s. U mos a en ion is paid o he p o essional aining o he consul an s. The newspape s a e compiled by expe ienced and epu able jou nalis s. By he second hal o 2006 he numbe o s a in Hunga y had exceeded 500. Besides, he company employs nea ly 1,000 people on a con ac ual basis in his ma ke . The a ailabili y o he in o ma ion ha can be made a ailable o he public abou he ma ke posi ion o he i m is limi ed due o he disc e e handling o he ele an da a. The igu es below e e exclusi ely o he Hunga ian subsidia y and i s en i onmen . The Hunga ian ma ke comp ises a popula ion o 10 - 10,5 381 million, 1.9 million o whom li e in he egion whe e In o m Media L d. ope a es. The company is one o he ou egional media g oups whose igu es a e as ollows: − Axel-Sp inge : 9 egional daily pape s, 1,019,000 eade s, 274,000 copies sold − AZ G oup: 4 egional daily pape s, 747,000 eade s, 224,000 copies sold − In o m Media G oup: 3 egional daily pape s, 560,000 eade s, 165,000 copies sold − Associa ed Newspape s: 2 egional daily pape s, 470,000 eade s, 135,000 copies sold The In o m Media L d has unde gone a dynamic de elopmen since i s appea ance in Hunga y which owing o i s con inuous expansion ac i i ies ends o con inue in he u u e. A e he ini ial loss making pe iod he Romanian subsidia y also became p o i able. The u no e inc ease o he Hunga ian and Romanian segmen s in he In o m Media g oup is shown in he ollowing g aph. The e is a wide-scale and expanded coope a ion be ween Aus ia whe e he pa en company is based, Hunga y and Romania p o iding he subsidia ies. As a esul o he s ong coope a ion we ace he c oss- bo de low o he majo i y o he ac o s o p oduc ion. Besides he mo e o labou and capi al ac o s, which belong o he ca ego y o basic ac o s o p oduc ion, he in e na ional low o echnology eme ges as a u he impo an ac o , wi hin which he low o human capi al is ou s anding. The p oduc s ha e wide-sp ead egional popula i y ha ’s why he common aspec ep esen ed by hem has an in luence on he ( ans) o ma ion o he local cul u e, as es and wo ld o ashion connec ed o he co po a e ac i i ies. In he case o In o m Media he low o labou is ealized a he le el o uppe manage s, ollowing he ype o a he a d ain b ain. Examining he low o labou wi hin he company- apa om he example o he Aus ian MD- he mig a ion o a longe pe iod is no ypical. Fo he manage ial posi ions he company employs manage s om he egion. An app o ed me hod o he exchange o expe ience and quick and undis o ed low o in o ma ion is he mo emen o manage s among he company cen es. The in e na ional low o echnology in he co po a e ac i i y mainly belongs o he ca ego y o in e na ional echnology ans e . The c oss-bo de mo emen o physical and in ellec ual ou wa d o ms o applied echnology is ealized by he ac i e pa icipa ion o he owne . The In o m Media g oup makes in e na ional in es men s mainly in he o ms o in as uc u al in es men s. A he company buying used p ope ies is he gene ally accep ed cus om. 382 The Hunga ian In o m Media L d. Is owned by In o m Media GmbH in 96,67% and in 3,33% he In o m Media P ope y U iliza ion L d. The Romanian In o m Media Immobilia e SRL is a p ope y u iliza ion company wo king in he sane way as he Hunga ian company and i is owned by In o m Media P ope y U iliza ion L d. In 99,9% and in 0,1% by In o m Media L d. The In o m Media SRL wo ks as a subsidia y o he In o m Media L d., which owns i in 98,4%. The u he 0,9% is owned by he In o m Media GmbH and 0,7% is owned by he In o m Media Immobilia e SRL. The In o m Media g oup ealizes he pu chasing o p ope ies h ough p ope y u iliza ion i ms, which unde ake he unning and leasing o he p ope ies, ypically o he pa en company. The company makes hese majo in es men s mainly wi h he help o loans. .