Ard Business Information, Profile, and History

Company Perspectives:

As institutions under public law, ARD's state-owned broadcasting stations are independent of government control; their sole obligation is to serve the public. Within the dual broadcasting system (nonprofit public and commercial private broadcasting), their task is providing the German public with information, education and entertainment.

History of Ard

ARD (Arbeitsgemeinschaft der öffentlich-rechtlichen Rundfunkanstalten der Bundesrepublik Deutschland) is a federation of one national and ten regional public broadcasting stations that reach over 72 million people in about 34 million German households. In a cooperative effort, these stations produce the content for the national 'First German Television' channel, eight regional TV channels, and over 50 national and regional radio channels, including radio programs in 12 different languages for foreigners. The national TV and radio network, Deutsche Welle, is government-owned and financed by taxes. ARD has a 30 percent share in German satellite channel 3sat, a 25 percent stake in European culture channel ARTE, a 50 percent interest in the children's channel KI.KA and the news-oriented PHOENIX channel, and runs a joint national video-text service and an Internet portal. To maintain its leading position in Germany's TV news market, ARD employs a network of roughly 100 foreign correspondents in 30 cities around the world.

ARD's communications infrastructure is provided mainly by Deutsche Telekom. Its central dispatching office, located in Cologne, manages the use of mobile TV broadcasting equipment. About 83 percent of ARD's funding is derived from a fee that every German household with radio receivers or TV sets, except low-income households and hospitals, are required to pay monthly. The fees are collected by Cologne-based Gebühreneinzugszentrale der öffentlich rechtlichen Rundfunkanstalten (GEZ). Approximately 14 percent of ARD's funds come from licensing, co-productions, and merchandising. ARD's third source of funding is advertising, which contributes about three percent of the total; the amount of advertising is strictly limited by law. ARD's advertising time is sold through ARD-Werbung SALES & Services GmbH (AS & S) while licensing for sports events is overseen by Sportrechte- und Marketing-Agentur GmbH (SportA), a joint venture of ARD and Germany's second public TV broadcaster ZDF. The federation is not a legally liable entity. ARD member stations take turns chairing the network's management board, while the managing station is elected by the general assembly. The managing station is legally liable for the federation during its one-year term, which can be extended for an additional year, and its director becomes ARD chairman during that period. ARD's various functions are supported by several subsidiaries, including Frankfurt-based management office ARD-Büro, the central program coordination office in Munich, its news headquarters located in Hamburg, the Frankfurt-based movie acquisition and production arm Degeto Film GmbH, and a central archive with locations in Frankfurt and Berlin.

German Radio: From Monopoly to Federation after World War II

When Germany entered the age of radio broadcasting in 1923, the government decided to raise the funds necessary for technical infrastructure and programming by imposing a general fee on every household that owned a receiver. The fee, in German the Rundfunkgebühr, was determined by the government-owned post office, the German Reichspost, and collected from German households by the mailman. The Reichspost also established the technical backbones of German broadcasting, including mid-, long-, and shortwave radio broadcasting stations. In 1925 the Reichs-Rundfunk-Gesellschaft (RRG) was founded as an umbrella organization for German radio broadcasting. First in the Weimar Republic, and then especially after the Nazis came to power in 1933, radio broadcasting in Germany was increasingly centralized. It became a propaganda vehicle of the Nazi government before and during World War II.

After Nazi Germany was defeated in 1949, the Western Allies started rebuilding a radio broadcasting infrastructure in West Germany. To prevent the formation of a new centralized system that could be misused again by political parties, they sought an appropriate organizational structure. After several abandoned proposals, the Arbeitsgemeinschaft der öffentlich-rechtlichen Rundfunkanstalten der Bundesrepublik Deutschland (ARD), that is the federation of public broadcasters of the Federal Republic of Germany, was formed in June 1950. The legal form of the new entity was Anstalt des öffentlichen Rechts, a nongovernment and nonprofit organization with its own administration under the control of two commissions, the Rundfunkrat and the Verwaltungsrat, in which different stakeholders from German public life were represented. ARD's founding members were six German broadcasting stations, the successors to the Allied Forces radio stations: Nordwestdeutscher Rundfunk (NWDR), the broadcasting station in the former British zone; Südwestfunk (SWF), the station in the French zone; and four stations located in the former part of Germany that was occupied by the Americans, Bayerischer Rundfunk (BR), Süddeutscher Rundfunk (SDR), Hessicher Rundfunk (HR) and Radio Bremen (RB). The new entity was financed by an obligatory fee which every German household with at least one radio receiver paid. Each station received the money collected in its state. However, larger ARD members subsidized smaller ones to a certain extent.

Between its foundation and 1962, the number of ARD members increased to ten. First, between 1953 and 1955, the new station Sender Freies Berlin (SFB)--literally translated Station Free Berlin--was founded in West Berlin, in the heart of the Soviet zone. NWDR dissolved during this time, and two new stations took its place, Norddeutscher Rundfunk (NDR) in the northern and Westdeutscher Rundfunk (WDR) in the western part of West Germany. After the French-occupied Saarland voted to join West Germany, the newly founded Saarländische Rundfunk (SR) joined ARD in 1959. Finally, in 1960 the international German radio station Deutsche Welle (DW) was founded and became ARD's tenth member two years afterwards. Every member of the federation remained independent, and decisions were made by the directors of all member stations.

The Age of German Television Begins in 1950

During the Nazi years, radio broadcasting was equivalent to the voice of the political power, and thus the German public was not accustomed to a plurality of ideas. Therefore, the Western Allies and the Americans in particular put a high emphasis on airing discussions and shows that invited different opinions. The year 1950 marked the beginning of the postwar radio broadcasting age for Germany. On November 27 of that year, ARD member NWDR began broadcasting three times a week from its studio in an old bunker on Hamburg's Heiligengeistfeld. Two years later, on Christmas Day 1952, German television was officially launched. On the following day, ARD's flagship daily news program 'Tagesschau' aired for the first time and found a permanent home in ARD's news headquarters in Hamburg Lokstedt in 1955. Broadcast three times a week at first, the show later switched to a daily schedule and became a hallmark of German public television. Two of the first TV events of the time were the live broadcasts of the crowning of the English Queen Elizabeth II in June 1953 and the soccer world championship games in Switzerland in summer 1954 at which Germany won the title. ARD's first U.S. correspondent, Peter von Zahn, informed German TV viewers about life in the United States in his monthly show Bilder aus der neuen Welt--Pictures From The New World.

In the summer of 1954, SWF, BR, and NDR started their own regional TV programs. On November first of the same year, ARD's joint channel, Deutsches Fernsehen, which later became Erstes Deutsches Fernsehen (First German Television), went on air. The new channel consisted of jointly-produced shows such as Tagesschau as well as broadcasts produced individually by ARD member stations. The programs were coordinated by the Programmdirektion based in Munich. Besides several entertaining shows, ARD went political in 1957 when it launched its first political TV magazine, Panorama. Germany's first political TV show adopted the slogan 'What is being talked about and what should be talked about' and pictured all aspects of postwar West German society--including conflict-laden topics, scandals, and other taboo topics, such as former Nazis who then held high positions in the political and legal systems. Embraced by the German public, Panorama became the instant enemy of the German federal government. One of the first moderators of the show, Gert von Paczensky, greeted his viewers with: 'And now let's pick a little bit on the federal government.' The leading party at that time, the Christian Democrats, objected to the critical tone of the TV journalism, and Paczensky lost his position in 1963. By the end of the 1950s the number of German TV viewers had exploded. While only about 1,500 TV sets in private households, public halls, and shopping windows had shown queen Elizabeth's crowning in 1953, the German post office reported the one millionth TV consumer in October 1957. Only one year later that number had doubled; it would reach roughly 3.4 million by 1960.

Reoganization and Private Competition in the 1960s, 1970s and 1980s

The success of NDR's Panorama inspired ARD to launch two more political shows. The first one, Report, was introduced in 1960 and broadcast by BR and SWR. WDR-produced Monitor followed five years later. ARD's political shows were enormously popular and reached up to 40 percent of TV viewers during the 1960s. Beginning in March 1960, Tagesschau viewers were presented with 'Tomorrow's Weather' after the news of the day. In the following two decades ARD consistently expanded its information and news reporting capabilities and broadcasts. In 1963 Bericht aus Bonn, a weekly news show covering the major events in West Germany's new capital, Bonn, premiered. Based on the reports of ARD correspondents in London, Paris, Rome, Belgrade, New Delhi, Tokyo, New York, and Washington D.C., the international news show Weltspiegel was launched at the same time. ARD presented an election prognosis for the first time during the 1965 governmental elections.

The era of color television officially began in Germany when West Berlin mayor Willy Brandt pushed a button at the international broadcasting trade show Funkausstellung in Berlin in August 1967. Other TV events of the 1960s included U.S. President John F. Kennedy's visit in West Germany in 1963 and the live broadcast of U.S. astronaut Neil Armstrong's landing on the moon on July 21, 1969, at four o'clock in the morning for German viewers.

In 1975 ARD opened a studio in East Berlin, and three years later its half-hour moderated late-night news show Tagesthemen was launched. In addition to its information arm that also produced documentaries such as The Third Reich, ARD developed a diverse set of entertaining broadcasts, including quiz-shows, TV series, programming for kids, and music shows.

During the 1960s and 1970s, the ARD organization itself also changed significantly. In June 1961 all German states signed the 'Staatsvertrag über das Zweite Deutsche Fernsehen,' a law that created the second German public broadcaster (ZDF) owned by the states. The new station became ARD's first competitor for TV viewer's attention. In 1964 ARD member station BR launched its own TV programming, and other ARD member stations followed suit. These programs ultimately became Germany's so-called 'third channels.' They were free of advertising and focused on regional news, information, and entertainment with a regional touch. After a 1968 ruling of the Bundesverwaltungsgericht, Germany's highest administrative court, the responsibility for setting the Rundfunkgebühr was transferred from the post office to the German states. In 1976 the Gebühreneinzugszentrale (GEZ) was founded by ARD and ZDF and took over the collection of the fee. However, the change with the most fundamental impact on ARD occurred in 1984 when the first commercial TV channels ended the public broadcaster's monopoly of the German market. Beginning in 1986, an ever growing competition from private radio stations challenged their public counterparts. However, while the new private competitors sharpened their weapons, a historical surprise created a TV spectacle for ARD and new challenges for German politics.

The Effects of German Reunification in 1990

On November 9, 1989, ARD's Tagesschau reported that GDR-government official Günter Schabowski had proclaimed freedom to travel to the West for GDR citizens. On the same evening the first openings of the Berlin Wall were covered live in special broadcasts. Pictures of East Berliners celebrating with their Western countrymen took the world by storm--and by complete surprise as well. The reunification of Germany in October 1990 resulted in a major challenge for ARD since its mission had to be expanded to include the new German states. In December 1990 ARD started broadcasting in former East Germany. While East Germany's central TV channel DFF was shut down, some of its most popular shows were integrated into ARD's programming.

On August 31, 1991, the Minister Presidents of all German states signed an agreement that became the new legal basis of the so-called 'dual radio broadcasting system,' the 'Staatsvertrag über den Rundfunk im vereinten Deutschland.' This agreement regulated the rights and responsibilities of the public broadcasting sector, including its financing, and contained guidelines for commercial broadcasters as well. The treaty guaranteed the existence of public broadcasting and its financing through the Rundfunkgebühr. Among other things, it regulated the quality and quantity of advertising among public and commercial radio and TV stations. The new law also abandoned the 50-percent discount that hotels had received on the TV-fee for some of their TV sets, which resulted in about DM 33 million in additional revenues for public broadcasters--and an equal amount in additional costs for Germany's hotels.

In 1992 two new ARD stations started broadcasting in the eastern German states. Mitteldeutscher Rundfunk (MDR) served the states of Saxony, Saxony-Anhalt, and Thuringia in the south; Ostdeutscher Rundfunk Brandenburg (ORB) covered Brandenburg and Berlin in the east; NDR served Mecklenburg-Vorpommern in the north. Beginning in 1992, GEZ started collecting the Rundfunkgebühr in the eastern German states and in the eastern part of Berlin. Another agreement between all public broadcasters enabled GEZ to function as their central data processing center administering the data of all 'radio broadcasting participants,' or every household that owned at least on radio receiver or TV.

In July 1990 Germany's Minister Presidents also decided to merge the national radio channel Deutschlandfunk with the former West Berlin-based station of the American Allied Forces, Rundfunk im Amerikanischen Sektor (in short, RIAS 1), to form the new national radio channel DeutschlandRadio. The new channel, launched in 1994, was a cooperative venture of ARD and ZDF and not an ARD member.

Threats from Politicians and Private Media Giants in the 1990s

Since the beginning of commercial radio and TV broadcasting in Germany, ARD had two major adversaries: the commercial broadcasters and the federal government. The main criticism ARD had faced since the beginning involved two of its income sources, the obligatory Rundfunkgebühr and advertising. In the late 1950s, ARD had voluntarily limited the amount of its advertising. To avoid confrontations with newspaper publishers who accused ARD of taking away business, its directors opted not to broadcast any commercials after 8 p.m. However, with the emergence of private TV stations solely financed by advertising, ARD became commercial TV's permanent target of criticism. Their argument was that the public broadcaster should rely solely on the fee collected from German 'TV-households,' which private stations had no share in. Public broadcasters, the private stations argued, should abandon the advertising business altogether. ARD and its political backers maintained that advertising revenues ensured the federation's political independence and that the Rundfunkgebühr would have to be raised by 36 to 84 German Marks, about $18 to $42, per household per year, to make up for the financial losses. However, after Germany's reunification, ARD and ZDF had already instituted an increase of the monthly TV-fee by 25 percent to finance their expansion into the new east German states, specifically its satellite and cable programming and technical infrastructure.

Germany's commercial TV broadcasters actually had little reason to complain. After 1984, they were able to continually command a larger market share, while ARD suffered significant losses in advertising revenues. By the 1990s, ARD's losses in advertising revenues were reaching up to 22 percent annually. The permission for public broadcasters to use program sponsoring after the 8 p.m. limit, which was part of the new law, brought only a meager relief. By 1991, private TV-stations RTLplus and SAT1 had surpassed ARD in revenues. In 1994 ARD's advertising losses were about $25 million with a total of $227 million in advertising revenues remaining.

German politicians had watched ARD suspiciously since its inception. As early as 1961, the Christian Democrat chancellor, the conservative Konrad Adenauer, had tried to create a central TV channel, the Bundes-Fernsehen, which was ultimately stopped by the Bundesverfassungsgericht. With the arrival of commercial TV, politician interest in ARD faded for a period of time. Private TV was being explored as a new medium of political mass communication, offering a broader variety of avenues in which leading party figures could spread their news.

In 1993, Christian Democrat Chancellor Helmut Kohl signed a contract for six appearances on SAT1, one of Germany's largest private TV channels, owned by movie mogul Leo Kirch, to be interviewed by 'friendly' journalists from newspapers owned by the same conglomerate. Some commentators speculated that this was the result of a close friendship between Kohl and Kirch. At the same time, Kohl and his finance minister, Wolfgang Schäuble, started a debate questioning Germany's existing public broadcasting system. Two years later the conflict climaxed. In February 1995, the London-based newspaper The Guardian reported that in an unusually emotional reaction to a snide attack on an ARD show, Kohl complained that ARD had 'lost all sense of decency and dignity' and threatened the federation's funding and structure. He suggested reducing the number of ARD member stations from 11 to around seven as a way of cutting costs and TV-fees. ARD and the opposition party, the Social Democrats, regarded this as the start of a campaign aimed at abolishing independent public broadcasting. Thus they threatened to use their majority in the Bundesrat, the assembly of German states, to block the further development of private TV in Germany. While the conflict lost steam, ARD was still plagued by the second means of influence of major politics: the political party membership of the directors of ARD's member stations, which often guaranteed a certain degree of compliance.

Strengthening Position in the New Millennium

ARD had lost no less than two-thirds of its advertising revenues, but this accounted for only a minority of its funding, the bulk being generated from the Rundfunkgebühr fees. Several lawsuits brought by organizations as well as individuals attacking ARD's funding privilege failed. The Bundesverfassungsgericht (BVG), Germany's Supreme Court, consistently decided in ARD's favor, willing to protect its political and financial independence. In 1994 BVG ruled that the commission that calculated the fee, KEF, had to be independent of state and federal politics. However, when commercial TV broadcasting stations SAT1, RTL, and other private cable TV channels were gaining momentum--and viewers--in the early 1990s, ARD felt pressed to adjust its programming to stay competitive. More and more entertainment formats used by private TV channels (talk shows and daily soap operas for example) made their way into ARD's programming, a trend which was harshly criticized by ARD backers as well as opponents.

Its 50th anniversary in 2000 fueled new public discussions about the legitimacy of ARD's existence. Besides being under attack for the diminishing quality of its programming, ARD also struggled with its image as an inflated bureaucracy. For example, each of the 11 regional ARD members maintained its own studios and editorial departments. Moreover, the already large group of stations sought to secure its place in the emerging markets of pay TV, digital radio and TV, and the Internet. While first signs of willingness to streamline its operations had been visible since 1998 when former ARD member stations SDR and SWF merged to form SWR, the battle against the interests of ever stronger private media networks showed no signs of abating. In the 1990s, ARD had lost to its rivals several radio and TV frequencies, high-profile staff, major movie rights, and licenses for broadcasting the most popular sports. A scandal caused by ARD member MDR provoked additional criticism. When it became known in the fall of 2000 that MDR had lost about DM 2.6 million in TV license fees in a currency speculation deal, Saxony's state assembly at first refused to approve the suggested increase in the Rundfunkgebühr of almost 12 percent.

Nevertheless, ARD remained a fierce competitor, and by its 50th anniversary year (2000) ARD had regained its place as Germany's top TV channel in the number of overall viewers as well as in popularity, beating its public rival ZDF as well as commercial channel RTL to which it had earlier lost this leading position.

Principal Subsidiaries: 3sat (30%); ARTE (25%); KI.KA (50%); PHOENIX (50%); GEZ (50%); ARD-Werbung SALES & Services GmbH; Sportrechte- und Marketing-Agentur GmbH; Degeto Film GmbH.

Principal Competitors: RTL Group; KirchHolding GmbH & Co. KG; ZDF; n-tv.

Chronology

• Key Dates:

• 1950: Company is founded by six German broadcasting stations.
• 1952: ARD's flagship daily news program Tagesschau airs for the first time.
• 1967: The era of color television begins at the international broadcasting trade show Funkausstellung in Berlin.
• 1978: ARD's moderated late-night news show Tagesthemen is launched.
• 1984: The first commercial TV broadcasting stations go on air.
• 1989: ARD reports live about the fall of the Berlin Wall.
• 1992: The new ARD stations MDR and ORB begin serving the eastern German states.
• 1993: ARD programs are broadcast via satellite.
• 1995: ARD closes the 'night gap' and broadcasts around the clock.
• 1998: Former ARD stations SDR and SWF merge to form SWR.
• 1999: ARD's new capital broadcasting studio opens in Berlin.