Kauppalehti which bought a 22 percent stake in BNS in 1998 acquired full control of the company in May 2001 when it purchased a 59 percent stake from the Swedish Bonnier Group's business daily Dagens Industry.
"We believe that the Baltic market will grow in the future," said Juha Blomster, president of AMBIG. The company is planning to expand to Russia and Poland in the future.
"Our solid market position and the transparency of our company were the two most important things that stimulated the Finnish company to decide for us," said BNS Board Chairman George Shabad. "The Baltic online media market is a difficult market with a lot of companies appearing, disappearing, investing a lot of money, losing it and shutting down."
"The long history of BNS and the transparency of the company were very important for our investors," he said.
BNS was founded by a group of Baltic students in Moscow in 1990 at the height of the Baltic states' struggle for freedom to bring direct news from Estonia, Latvia and Lithuania to Moscow-based foreign correspondents. BNS was one of the founders of the English-language weekly The Baltic Observer, the forerunner to The Baltic Times.
Allan Martinson, one of the founders of BNS, who now manages Microlink, the biggest Baltic IT company, said that he would not have believed in the 90s that BNS would obtain such a secure position on the Baltic media market.
"There are many young people who believe that BNS has existed forever," he said. "BNS is a strong, stable company and has overthrown a widespread myth that a news agency's business can't be succesful and has to be supported," Martinson said.
BNS became the first competition to the former Soviet state-run news agencies in Estonia, Latvia and Lithuania which controlled the Baltic media market at the time. Delayed privatization and bad management led to their demise and BNS became the leader in the small Baltic market.
But competition is gathering strength. The former state-run wire services - ETA of Estonia, LETA of Latvia and ELTA of Lithuania - are now privately owned and back on their feet, seriously challanging BNS.
With 57 million kroons ($3.3 million) in turnover last year, BNS claims it controls 70 percent of the Estonian, 50 percent of the Latvian and 70 percent to 80 percent of the Lithuanian online information market.
"This is calculated according to the amount of money involved in the market, which includes portals, online newspapers, media monitoring services and other companies that release information products online," Shabad said.
BNS's competitors don't agree. Their estimates show that BNS's market share in Latvia is 40 percent and the Lithuanian market is divided 50-50.
Estonian ETA was privatized in 1999 but changed owners in April, 2000, after bankruptcy when its brand name was purchased by the Latvian investment fund C&R, ETA's manager Tiit Lohmus said. The company, whose turnover last year was 2.2 million kroons, works unprofitably but hopes to generate more revenue in the future since many free-of-charge online news sources have closed down recently. Lohmus said that BNS produces more business news and for a higher price, while ETA is focused on human interest stories such as regional, social and cultural news.
The Lithuanian news agency ELTA is 39 percent state owned and the rest belongs to about 60 shareholders including newspapers, magazines, radio and TV companies. Last year the company netted a 3.4 million litas ($850,000) turnover and turned a profit. This year the company will end up with some 4 million litas in turnover and a loss due to large investments in construction works.
"Our strength over BNS is that we offer both photos and text," said Gestutis Jankauskas, head of ELTA. "BNS has more business news, but we are planning to expand there as well."
LETA feels the strongest of the three siblings with 2001 being its second profitable year since the company's privatization in 1997. LETA is planning a 30,000 lat ($48,400) profit on a 800,000 lat turnover for the year. A little more than a third of the company belongs to the management, the other third to the U.S. investment fund Baltics Small Equity Fund and the rest to the U.K. investment fund Tradevision.
Martins Barkans, LETA's board chairman, asserts that his company has regained its leading position on the Latvian market. "LETA produces more stories and covers more areas," Barkans said.
Barkans said that BNS' main weakneses are its "lack of development of new products and services, its frequent changes of local management in Latvia and its negative financial result from local operations in Latvia."
Barkans stressed that the biggest advantage of BNS is its Pan-Baltic presence. But ETA, LETA and ELTA are already cooperating on the Baltic market.
"It's just a question of time when we launch a joint product for the Pan-Baltic market," ETA's Lohmus said.