Holy Roman Empire

Chapter 441: Making Money is Only Incidental

If the Christmas Eve of 1868 brought worldwide fame to the Austrian New Energy Power Company with the “City That Never Sleeps,” then 1869 established the company’s dominance in the industry.

With the completion of a series of patent authorizations, the Austrian New Energy Power Company’s standards also became the international standards for electrical systems.

Breaking this set of standards isn’t difficult. As long as one is willing to spend enough money, it can always be broken. However, how much money it would take, no one knows.

If this were a highly profitable industry, the consortiums might give it a try. Unfortunately, the electric power industry was just beginning to emerge, and city power supply systems, although appearing attractive, were difficult to make profitable.

No one knew when the market would mature, but everyone was clear about when the patented technologies would expire.

This era had not yet entered the fast-paced stage, and people’s sense of crisis was not that strong. They did not believe that within 20-30 years, electricity would become the mainstream of the era.

Take the steamship as an example. In 1796, John Fitch manufactured one. At that time, it was also considered an era-changing technology. However, more than seventy years have passed, and the main vessels in the sea are still wind-powered.

There are many such examples. From the appearance of a technology to its large-scale application, there is a time period in between. The length of this period directly determines the commercial value of the technology.

To promote the advancement of electric power technology, Franz invested several million guilders. If the later promotion costs are included, the cost has already exceeded ten million guilders.

It is important to note that this is not a single technology but an entire industrial system. It includes upstream industries such as steel, copper smelting, rubber, and other raw material industries, as well as downstream industries such as power transmission, generators, electric lights, and electric meters.

Without significant investment, this cannot be achieved. It is not something that 1-2 scientists and dozens of engineers can complete. It tests the industrial strength of a nation.

This is also why most technological inventions and creations in the 19th century were concentrated in Europe and America. Without a supporting industrial system, even if you were given the technology to build an atomic bomb, you wouldn’t be able to create it.

Franz was in a good mood. The Austrian New Energy Power Company had made a profit. Even though it was through selling technology, this was still a good start.

If everything goes as expected, a consortium centered around the Austrian New Energy Power Company will soon emerge.

Since the advent of the capitalist era cannot be stopped, then they should control it.

Those who follow me will prosper; those who oppose me will perish!

As an emperor, Franz did not lack boldness. Leveraging his foresight and the advantage of his power, he began to lay out his industrial plans in advance. It was not impossible for him to secretly control the empire’s economy.

This thick stack of commercial contracts was his confidence. So far, the Austrian New Energy Power Company has signed strategic cooperation agreements with over a hundred cities.

These cities were not only in Austria but also in other European countries. The main reason for their cooperation was mutual benefit.

Simply put, the Austrian New Energy Power Company provided technology at a discounted rate, along with part of the funding, to establish joint ventures with local governments. Everyone was contributing to advancing the lighting revolution for humanity.

Letting foreign companies monopolize the country’s power supply would surely cause concern, but turning it into a domestic company makes a difference.

Many local governments do not directly invest in enterprises, so these shares can be taken up by private capital. The specific distribution of shares would naturally be calculated based on the investment from both sides.

In the face of mutual benefits, everyone can become good friends. No one doubts the prospects of electricity, but considering the costs, everyone tacitly agreed to delay the construction timeline.

This arrangement satisfies everyone’s needs. The Austrian New Energy Power Company completed its strategic layout, extending its influence to various European countries.

Politicians secured contracts that pleased the public. When these would actually be realized, it didn’t matter; they already had their political achievements in hand.

Investors were investing in the future. For now, they only signed commercial contracts and provided a small amount of capital to establish shell companies. When it becomes profitable, that’s when the real money would be spent.

As a result of these contracts, gas company stocks fell significantly. Ordinary people were unaware of the high current cost of electricity, and many assumed that electric lights would soon replace oil lamps.

This assumption wasn’t entirely wrong. The cost of oil illumination was also high, though cheaper than pre-popularized electricity. Once the power system is complete, monthly lighting costs would actually be more cost-effective.

An average household had only a few light bulbs, usually only one turned on at a time, consuming just a few kilowatt-hours per month, costing just a few schillings in total.

The main expense was the power supply equipment, leading to high connection fees. The installation cost alone required at least dozens of guilders, which ordinary people simply couldn’t afford, becoming the biggest obstacle to the widespread use of electricity.

This was under the condition of a high installation rate. If the installation rate in an area was low, the cost could potentially rise to thousands of guilders.

After all, even a single household still needed a power line, but so do dozens of households, and the more households sharing the cost, the lower the per capita expense.

No matter what, as long as these contracts become a reality, the Austrian New Energy Power Company will have secured a long-term source of income.

Even if these subsidiaries aren’t very profitable, just providing them with technical services and selling supporting electrical equipment would be enough to keep the Austrian New Energy Power Company well-fed.

Even if they did nothing else and remained idle until the 21st century, they would still be a Fortune 500 company. Fortunately, no one in this era thinks that far ahead, otherwise, these deals wouldn’t be so easily secured.

It’s not accurate to say they secured the deals. It seems more like the deals were delivered to their doorstep. The Austrian New Energy Power Company didn’t even need to go out and solicit business; clients came to them.

However, complacency is unacceptable. A company that does not strive to improve cannot become a great enterprise.

“Tell Marc-Oliver to keep up the good work and expand as much as possible. Seize more territories while there are no major competitors involved, and bring more cities into our fold.

Additionally, rebrand the company. The Austrian New Energy Power Company is not just an ordinary company. It is an enterprise with a great vision.

Our goal is to light up the world. Making money is only incidental.

If some partners have doubts, allow them to hold a majority stake in the subsidiaries. The key is to expand quickly, complete the European strategic layout as soon as possible, and then extend our reach globally.”

Monopolizing the power supply is impossible, but what can be done now is to leverage the first-mover advantage and capture as many cities as possible.

As for the countryside, money-losing ventures are the government’s responsibility and are not currently part of the Austrian New Energy Power Company’s plans. The future, however, is uncertain.

Such public infrastructure and livelihood projects will inevitably have their profits capped by governments around the world. Otherwise, the backlash from the public could be severe.

When that time comes, rural electricity can be considered. The costs of new construction and maintenance will directly dilute the subsidiary’s profits.

No longer being a highly profitable industry means the public won’t criticize as much. Retaining a reasonable profit margin of around ten percent is something no one will complain about.

Moreover, lower subsidiary profits do not equate to lower overall company profits. While dividends might decrease, the costs for later-stage equipment maintenance and parts procurement will rise.

Even if there are calls for the nationalization of electricity, it depends on whether local governments are willing to take over. The increased costs of converting private enterprises to state-owned ones are not just a few percentages. Turning a profitable business into a loss-making one is not uncommon.

If a government does move to nationalize, Franz wouldn’t mind selling for a good price. Enterprises with strong backgrounds never worry about being swallowed up. Being a legitimate business, nationalization must follow proper procedures, with the government buying company shares at a premium.

By that time, they would have already made enough profit. The additional benefits gained in other areas might far exceed direct profits.

This is the advantage of a conglomerate: one industry drives a series of others. Even seemingly unprofitable industries can generate returns in other areas.

…

“This is truly a city that never sleeps. It really is the most beautiful city in the world, far beyond Tokyo!”

“Of course. Only London and Paris can compare to this place. Tokyo would need a long time to reach this level.”

The speakers are Toshimichi Okubo and Hirobumi Ito. After the victory in the Boshin War in 1868, the Meiji Government was established and headed by Emperor Meiji.

To reclaim sovereignty, Emperor Meiji dispatched a delegation to Europe to negotiate with various governments. The negotiations also involved on-site investigations to learn the methods of powerful nations in Europe.

The more they saw, the more they could feel the gap between them. The Japanese of this era had no arrogance whatsoever and presented themselves completely as diligent learners.

It was evident that their spirits were low. They had visited many countries along the way, but the negotiations were progressing very poorly.

The European countries did not take them seriously at all. Wanting to revise treaties and reclaim sovereignty was a pipe dream! Expecting them to give up what they had already taken was impossible in the survival-of-the-fittest mentality of the 19th century.

It was uncertain whether they were lucky or unlucky. At this time, Franz was inspecting the Balkans, accompanied by several cabinet ministers.

With the key figures absent, it was naturally impossible to persuade Austria to make concessions with mere eloquence.

The Austrian Ministry of Foreign Affairs had already given their answer: treaty revisions could be negotiated in exchange for benefits, or the Japanese could buy their way out with money. Empty promises were out of the question.

The conversation was in a stalemate that it couldn’t continue. The Ministry of Foreign Affairs also rejected their request to meet high-level government officials. The reason was simple: disdain.

Japan’s international status at that time was very low, even lower than that of the Principality of Montenegro. European countries treated them as if they were natives.

Hirobumi Ito and others had visited six or seven European countries, but none had extended appropriate diplomatic courtesies. To meet senior government officials, they had to pay bribes; otherwise, the officials were too busy to meet them.

With negotiations failing, they could only conduct on-site investigations to learn the methods of powerful nations. Despite all three claiming to be constitutional monarchies, the systems of Britain, France, and Austria were quite different.

Through initial observations, Hirobumi Ito realized that the models of Britain, France, and Austria were not ones they could emulate.

These three were all old empires that remained European powers even during their weakest periods in the last century, facing mostly internal problems without the risk of becoming colonies.

Japan couldn’t compare, as they lacked the foundation to resist external threats.

Toshimichi Okubo asked, “Ito-san, did you notice that we haven’t seen thick black smoke in Vienna, unlike in Paris and London?

It’s said that Europe is currently in an economic crisis, and many factories have closed. Now, with the Austrian Emperor personally inspecting the regions, does it mean Austria’s economic crisis is so severe that no factories are operating in Vienna?”

Looking at the bustling streets, Hirobumi Ito pointed with his finger and said, “It doesn’t seem like it. This looks like a prosperous scene. If the economic crisis were that severe, these ordinary people probably wouldn’t be smiling.

Moreover, Vienna is a city that never sleeps. With so many streetlights, the monthly electricity bill must be no less than 400,000 to 500,000 taels of silver.”

Electric lights were a new phenomenon they had encountered in London, challenging their perceptions.

However, in London, electric lights were a luxury for the wealthy, and to avoid losing face for their motherland, Japan, they only observed from a distance and never got up close.

It was different in Austria. The power company was already promoting electric lights, with streetlights everywhere and even electric lights installed in their hotel. Seeing them so frequently, they became accustomed to it.

Hirobumi Ito’s estimate of a monthly electricity bill of 400,000 to 500,000 taels of silver left the entire delegation in stunned silence. They couldn’t help but compare this to Japan and were embarrassed to find that Vienna’s electricity bill equaled half of Japan’s financial revenue.

Of course, this number was inaccurate. The cost of electricity for street lighting and residential use was different, and the actual monthly bill was about tens of thousands of taels of silver.

This expense wasn’t covered by the Vienna city government but was passed on to the merchants. This tax was gladly paid, as the city had become more prosperous since Vienna lit up.

The fame of being the “city that never sleeps” attracted many visitors, boosting commerce. Vienna was already showing signs of becoming a tourist city.

The delegation leader, Tomomi Iwakura, waved his hand and said, “No need to delve into it. This is Austria’s territory. Whatever the case, it has nothing to do with us. Perhaps this city doesn’t have any industry!”

Even he didn’t believe his own words. In this era, large cities without industry did exist, but only in backward areas.

In the great powers’ countries, almost every city was filled with thick smoke. Austria was no exception, and Vienna was only an anomaly due to Franz’s intervention.

The thick smoke rising into the sky was considered by many to be a sign of a powerful nation. Even the foul-smelling London was seen by many as an ideal place.

The Japanese, known for their extreme views, were no exception. If one were to carefully examine their literary works from this period, there were many positive descriptions of these conditions.

In short, this exhaust was considered fragrant back then.