Leo Kirch
Encyclopedia
Leo Kirch was a German
media
entrepreneur
who founded the Kirch Group
.
, Bavaria
, but shortly afterward his family moved to the nearby town of Würzburg
. After completing High school he studied marketing
and management
as well as mathematics
at the University of Munich, graduating in 1952. It was during this time that he gained an interest in electronic media
.
In 1956 he purchased the German rights for the Italian
movie La strada
. He borrowed money for this venture through an enterprise with a complicated and unclear structure, with ownership distributed amongst himself and various daughters. As his company rose to become one of the most important private media companies in the then West Germany
, the country's second public broadcaster, ZDF
, came to depend on it heavily for films and other programs, partly as a result of companies that appeared to be competing actually being owned by Kirch. This situation remained for many decades, until the launch of commercial television in 1984. Kirch was the owner of the first private channel, Sat.1
and withdrew his series from ZDF.
In 1985 he purchased a stake in the leading tabloid Bild after the death of former owner Axel Springer
. During the 1990s he set up the subscription television service Premiere
and became a key player in sports broadcasting rights, paying massive amounts for the rights to the German
Bundesliga
, eventually to the point where even players of moderate ability could earn multi-million mark salaries. This was consistent with trends happening across much of Europe
at the same time. In addition, in 1996 he purchased the rights to the 2002
and 2006 FIFA World Cup
s for some €
1.9 billion and purchased the rights to Formula One
for €1.5 billion.
Even during this decade there were reports of the group being on the edge of insolvency. His large investments in sports broadcasting rights and in pay television were major reasons. In other countries of Europe pay television could be operated profitably, because there were few freely receivable channels. Many programs also aired on Premiere at the same time that they aired on terrestrial television
. This resulted in an investment of some €3 billion for only 2.4 million subscribers. Combined with the fact that many of the packages were more expensive than similar packages available, the decoder was easy to crack, resulting in large amounts of piracy. In 2002 these difficulties came to a head and KirchMedia declared itself insolvent on April 8. Kirch himself withdrew itself from the enterprise, but kept up participation in the Swiss
arms on his business, transferring sports broadcasting rights to the subsidiary. The insolvency represents the largest insolvency of an enterprise in German postwar history. The next month Kirch sued Deutsche Bank
for €100m, claiming that they had questioned the status of the group and disclosed confidential business information in the process.
were on friendly terms for decades. Kirch was always accused of preferential coverage and advertising. Kohl arranged the creation of commercial television as one of his first official acts as Chancellor in 1982; this allowed Kirch to own a TV station and sports broadcasting rights. During the 1999 CDU contributions scandal
, it was revealed that Kirch had donated six million DM to the CDU during Helmut Kohl's tenure as chancellor. In addition, Kohl, along with various other CDU/CSU politicians, was revealed to be an adviser to the firm during the insolvency process.
's spying scandal. Moreover, according to the WSJ, the lawfirm that was representing Kirch was the target, and perhaps victim of, an effort to infiltrate a "mole
" into the firm in furtherence of the Bank's spying.
, aged 84.
Germany
Germany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...
media
Mass media
Mass media refers collectively to all media technologies which are intended to reach a large audience via mass communication. Broadcast media transmit their information electronically and comprise of television, film and radio, movies, CDs, DVDs and some other gadgets like cameras or video consoles...
entrepreneur
Entrepreneur
An entrepreneur is an owner or manager of a business enterprise who makes money through risk and initiative.The term was originally a loanword from French and was first defined by the Irish-French economist Richard Cantillon. Entrepreneur in English is a term applied to a person who is willing to...
who founded the Kirch Group
Kirch Group
KirchGruppe was a German media group founded by Leo Kirch. The group collapsed in 2002 largely due to the debts associated with the purchase of sports rights for its television channels and the launch of pay-TV services....
.
Life
Kirch was born in VolkachVolkach
Volkach is a town in the district of Kitzingen in the Regierungsbezirk Unterfranken in Bavaria. The town was founded in 906 AD.Volkach's main tourist attraction is its annual wine festival. Volkach's wine festival is the culminating festival for the entire Franken wine region.-External links:*...
, Bavaria
Bavaria
Bavaria, formally the Free State of Bavaria is a state of Germany, located in the southeast of Germany. With an area of , it is the largest state by area, forming almost 20% of the total land area of Germany...
, but shortly afterward his family moved to the nearby town of Würzburg
Würzburg
Würzburg is a city in the region of Franconia which lies in the northern tip of Bavaria, Germany. Located at the Main River, it is the capital of the Regierungsbezirk Lower Franconia. The regional dialect is Franconian....
. After completing High school he studied marketing
Marketing
Marketing is the process used to determine what products or services may be of interest to customers, and the strategy to use in sales, communications and business development. It generates the strategy that underlies sales techniques, business communication, and business developments...
and management
Management
Management in all business and organizational activities is the act of getting people together to accomplish desired goals and objectives using available resources efficiently and effectively...
as well as mathematics
Mathematics
Mathematics is the study of quantity, space, structure, and change. Mathematicians seek out patterns and formulate new conjectures. Mathematicians resolve the truth or falsity of conjectures by mathematical proofs, which are arguments sufficient to convince other mathematicians of their validity...
at the University of Munich, graduating in 1952. It was during this time that he gained an interest in electronic media
Electronic media
Electronic media are media that use electronics or electromechanical energy for the end-user to access the content. This is in contrast to static media , which today are most often created electronically, but don't require electronics to be accessed by the end-user in the printed form...
.
In 1956 he purchased the German rights for the Italian
Italy
Italy , officially the Italian Republic languages]] under the European Charter for Regional or Minority Languages. In each of these, Italy's official name is as follows:;;;;;;;;), is a unitary parliamentary republic in South-Central Europe. To the north it borders France, Switzerland, Austria and...
movie La strada
La Strada
La Strada is a 1954 Italian neorealist drama directed by Federico Fellini in which a naïve young woman is sold to a brutish man and goes on the road as a part of his itinerant show....
. He borrowed money for this venture through an enterprise with a complicated and unclear structure, with ownership distributed amongst himself and various daughters. As his company rose to become one of the most important private media companies in the then West Germany
West Germany
West Germany is the common English, but not official, name for the Federal Republic of Germany or FRG in the period between its creation in May 1949 to German reunification on 3 October 1990....
, the country's second public broadcaster, ZDF
ZDF
Zweites Deutsches Fernsehen , ZDF, is a public-service German television broadcaster based in Mainz . It is run as an independent non-profit institution, which was founded by the German federal states . The ZDF is financed by television licence fees called GEZ and advertising revenues...
, came to depend on it heavily for films and other programs, partly as a result of companies that appeared to be competing actually being owned by Kirch. This situation remained for many decades, until the launch of commercial television in 1984. Kirch was the owner of the first private channel, Sat.1
Sat.1
Sat.1 is a privately owned German television broadcasting station. Sat.1 was the first privately owned television broadcasting station in Germany, having started one day before RTL Television....
and withdrew his series from ZDF.
In 1985 he purchased a stake in the leading tabloid Bild after the death of former owner Axel Springer
Axel Springer
Axel Springer , was a German journalist and the founder and owner of the Axel Springer AG publishing company.-Early life:...
. During the 1990s he set up the subscription television service Premiere
Premiere (pay television network)
Sky Deutschland AG, branded as Sky, is a German media company which operates the first pay television platform in Germany and Austria, offering several channels of digital content via satellite and cable....
and became a key player in sports broadcasting rights, paying massive amounts for the rights to the German
Germany
Germany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...
Bundesliga
Fußball-Bundesliga
The Fußball-Bundesliga is a professional association football league in Germany. At the top of Germany's football league system, it is the country's primary football competition. It is contested by 18 teams and operates on a system of promotion and relegation with the 2. Bundesliga...
, eventually to the point where even players of moderate ability could earn multi-million mark salaries. This was consistent with trends happening across much of Europe
Europe
Europe is, by convention, one of the world's seven continents. Comprising the westernmost peninsula of Eurasia, Europe is generally 'divided' from Asia to its east by the watershed divides of the Ural and Caucasus Mountains, the Ural River, the Caspian and Black Seas, and the waterways connecting...
at the same time. In addition, in 1996 he purchased the rights to the 2002
2002 FIFA World Cup
The 2002 FIFA World Cup was the 17th staging of the FIFA World Cup, held in South Korea and Japan from 31 May to 30 June. It was also the first World Cup held in Asia, and the last in which the golden goal rule was implemented. Brazil won the tournament for a record fifth time, beating Germany 2–0...
and 2006 FIFA World Cup
2006 FIFA World Cup
The 2006 FIFA World Cup was the 18th FIFA World Cup, the quadrennial international football world championship tournament. It was held from 9 June to 9 July 2006 in Germany, which won the right to host the event in July 2000. Teams representing 198 national football associations from all six...
s for some €
Euro
The euro is the official currency of the eurozone: 17 of the 27 member states of the European Union. It is also the currency used by the Institutions of the European Union. The eurozone consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg,...
1.9 billion and purchased the rights to Formula One
Formula One
Formula One, also known as Formula 1 or F1 and referred to officially as the FIA Formula One World Championship, is the highest class of single seater auto racing sanctioned by the Fédération Internationale de l'Automobile . The "formula" designation in the name refers to a set of rules with which...
for €1.5 billion.
Even during this decade there were reports of the group being on the edge of insolvency. His large investments in sports broadcasting rights and in pay television were major reasons. In other countries of Europe pay television could be operated profitably, because there were few freely receivable channels. Many programs also aired on Premiere at the same time that they aired on terrestrial television
Terrestrial television
Terrestrial television is a mode of television broadcasting which does not involve satellite transmission or cables — typically using radio waves through transmitting and receiving antennas or television antenna aerials...
. This resulted in an investment of some €3 billion for only 2.4 million subscribers. Combined with the fact that many of the packages were more expensive than similar packages available, the decoder was easy to crack, resulting in large amounts of piracy. In 2002 these difficulties came to a head and KirchMedia declared itself insolvent on April 8. Kirch himself withdrew itself from the enterprise, but kept up participation in the Swiss
Switzerland
Switzerland name of one of the Swiss cantons. ; ; ; or ), in its full name the Swiss Confederation , is a federal republic consisting of 26 cantons, with Bern as the seat of the federal authorities. The country is situated in Western Europe,Or Central Europe depending on the definition....
arms on his business, transferring sports broadcasting rights to the subsidiary. The insolvency represents the largest insolvency of an enterprise in German postwar history. The next month Kirch sued Deutsche Bank
Deutsche Bank
Deutsche Bank AG is a global financial service company with its headquarters in Frankfurt, Germany. It employs more than 100,000 people in over 70 countries, and has a large presence in Europe, the Americas, Asia Pacific and the emerging markets...
for €100m, claiming that they had questioned the status of the group and disclosed confidential business information in the process.
Kirch and Kohl
Leo Kirch and former Chancellor of Germany Helmut KohlHelmut Kohl
Helmut Josef Michael Kohl is a German conservative politician and statesman. He was Chancellor of Germany from 1982 to 1998 and the chairman of the Christian Democratic Union from 1973 to 1998...
were on friendly terms for decades. Kirch was always accused of preferential coverage and advertising. Kohl arranged the creation of commercial television as one of his first official acts as Chancellor in 1982; this allowed Kirch to own a TV station and sports broadcasting rights. During the 1999 CDU contributions scandal
1999 CDU contributions scandal
In late 1999, it was discovered that the German Christian Democratic Union political party had accepted illegal donations while under the control of Chancellor Helmut Kohl in the 1990s...
, it was revealed that Kirch had donated six million DM to the CDU during Helmut Kohl's tenure as chancellor. In addition, Kohl, along with various other CDU/CSU politicians, was revealed to be an adviser to the firm during the insolvency process.
Kirch and Deutsche Bank
Kirch was identified by the Wall Street Journal to be a target of Deutsche BankDeutsche Bank
Deutsche Bank AG is a global financial service company with its headquarters in Frankfurt, Germany. It employs more than 100,000 people in over 70 countries, and has a large presence in Europe, the Americas, Asia Pacific and the emerging markets...
's spying scandal. Moreover, according to the WSJ, the lawfirm that was representing Kirch was the target, and perhaps victim of, an effort to infiltrate a "mole
Mole (espionage)
A mole is a spy who works for an enemy nation, but whose loyalty ostensibly lies with his own nation's government. In some usage, a mole differs from a defector in that a mole is a spy before gaining access to classified information, while a defector becomes a spy only after gaining access...
" into the firm in furtherence of the Bank's spying.
Death
Kirch suffered from diabetes and a heart condition, and due to these became partially blind. He passed away in MunichMunich
Munich The city's motto is "" . Before 2006, it was "Weltstadt mit Herz" . Its native name, , is derived from the Old High German Munichen, meaning "by the monks' place". The city's name derives from the monks of the Benedictine order who founded the city; hence the monk depicted on the city's coat...
, aged 84.