Wolfgang Blau, president of Condé Nast International, is steering the global publisher toward organizing around brands rather than separate countries. While many publishers in Europe bemoan the onward march of U.S. tech platforms, Blau says Europe can gain a digital edge by developing machine language translation. This interview has been edited and condensed.
You just addressed the Presidency of the Council of the European Union in Austria. What was the purpose of the address?
I made one policy suggestion around machine translation. The European Union has 510 million citizens and 24 official languages. The initiative the EU has been working on for many years, the digital single market, means that for startups from any 28 member states to succeed, it needs to standardize things like copyright and consumer protection laws. They have made huge progress. But assume you succeed in creating this beautiful level playing field, you’ll still be tied down by enormous linguistic fragmentation. You can’t reach more than 20 percent of the EU’s population in any one of these languages, if you want to reach people in their native language. Even in English, as the most common second language, you can’t reach more than 50 percent of the EU. The one thing we are missing is translation. I suggested the EU makes the fast development of neural machine translation one of their flagship technology projects. Typically these EU projects get funding over €1 billion ($1.31 billion) over the course of 10 years. This is what will unleash the digital single market and lead to a similarly explosive growth of content and information as the internet did itself.
Where has the EU’s focus been so far?
I think the emphasis of the EU was to create a standardized level playing field. I travel in China and the U.S. and from the outside, Europe seems to play defense and, I think, quite overtly uses copyright law, consumer protection and privacy law as a means of protectionism. I am not opposed to time-limited protectionism as long as it’s clear why it’s being put into place.
In the short term at least, it seems GDPR has given Google more of an advantage.
It’s still a bit too early to tell. I look at sums Condé Nast International had to invest in becoming GDPR-compliant. What does this look like for smaller startups? That’s the criticism of the EU. In this sell of protectionism — building a shield of stronger user privacy against the U.S. platforms — it raised the barrier to entry for startups. My question is: Are you building a fortress for protecting mostly underfunded European e-commerce businesses, mostly outdated European publishing companies, or pushing them as hard to modernize as you’re pushing against Google and Facebook?
How should the European Union approach Google and Facebook?
[Leader of the European People’s Party] Manfred Weber publicly proposed to possibly break up Facebook, which is always a popular thing to say. But then what? That will tie up all your regulatory energy, and you still don’t have a European equivalent. They are already being regulated in different ways. I wonder what the aim of regulation is. Will this substantially change Europe’s digital competitiveness or not?
Europe is looking to get squeezed between the U.S.-owned and Chinese-owned digital spheres. Most democratic discourse happening is owned by U.S. platforms. At cash registers, shops accept Alipay; Musical.ly is growing fast in Germany and Italy. How can we take advantage of the European market without widening the bottleneck of linguistic fragmentation? There are risks if Europe doesn’t do this. The incentive for the Chinese is greater than for the U.S. Does Europe want China to own the translation API between its languages?
How has Condé Nast International’s relationship with platforms changed in the last three years?
The U.S. platforms now understand that we have such a strong presence on all social media platforms. We have much more attractive commercial models in China compared to Facebook and YouTube. I like talking to U.S. platforms and saying, ‘We don’t have to do this with you.’ The Chinese are looking for European partners; that’s a good position to be in. There are the obvious issues of user privacy and surveillance, but the interface of WeChat is far superior to WhatsApp or Facebook Messenger.
Are you more optimistic about the magazine and media industry than when you joined Condé Nast International in 2015?
Paradoxically, I am. I’ve learned more about the importance of brands. If you want to succeed in publishing, you’re in the best position if you are one of the very few papers of record, such as the The New York Times, or a B2B player, like the Financial Times. And then there are those very few brands that own a global niche, like Vogue or Architectural Digest. And brands that play such a topical niche need to be global. Otherwise, they wouldn’t reach economies of scale.