The Krone in its present form was created in 1959 by Hans Dichand, the former editor-in-chief of Kurier; and secretly funded by Franz Olah of the SPÖ, using funds of the ÖGB, the Austrian Trade Union Federation. The party newspapers were in decline at the time and Olah, influenced by the US press, planned to build a friendly newspaper. In 1964, Olah was thrown out of his party and the ministry of the interior after holding it for only one year, because it became apparent that he had once again used ÖGB funds, this time to finance the FPÖ. A few years later he was convicted and spent a year in prison for yet another of his financing schemes.

The Kronen Zeitung, using innovative marketing methods like "Sonntagsstandln" and concentrating on girls, children and pets rather than long stories to sell papers, grew rapidly. In the mid 60s, the ÖGB claimed ownership and the ensuing legal battle and political campaign lead to a financial settlement and arguably to the first ÖVP control of parliament.

At least since then, most politicians stayed close to Krone chief Dichand in fear of becoming a target of one of his concerted campaigns. While both big parties tried to avoid conflicts with the Krone, if at all possible, the ongoing collapse of the SPÖ's economic powerbase made it much more dependent on Hans Dichand's goodwill. Even Bruno Kreisky, the most famous of SPÖ chancellors, was no exception.

Later the Krone formed Mediaprint with the Kurier, controlling about 50% of the Austrian newspaper market and most of the magazines.

What differentiates the Krone from the Murdoch press is mainly it's origin as a populist counterpart to conservative media corporations like Styria. Consequently, it is far less friendly to neoliberal economic policy, and focuses mainly on increasing its own influence rather than pushing a particular political agenda.

In 1995 the Krone campaigned for accession to the EU, ensuring a yes victory; only to make Brussels, next to immigrants, its main recipient of bile. Similiarly, while the Krone campaigned ceaselessly against the great coalition of SPÖ and ÖVP while simultanously pushing the FPÖ, by providing it with a platform including regular columns by FPÖ members, it was vehemently opposed to the formation of the ÖVP-FPÖ government in 2000. Since the letter was published, the coverage of Werner Faymann has been nearly worshipful.

The most bizarre episode in this was Hans Dichand's dementi that no, Werner Faymann is not his out-of-wedlock son.

Causes of Gusenbauer's Downfall

When Alfred Gusenbauer managed to squeeze out the narrowest possible victory, everybody was surprised. Most of all the SPÖ itself. It had staked its campaign on opposition to tuition fees and the Eurofighters, yet sacrificed those positions in the coalition talks. Both decisions are defensible but how they were communicated by the SPÖ was not.

The party declared the tuition fees to be practically abolished after it launched a program that allowed students to work in social service programs for ridiculously low hourly wages instead of paying.

Alfred Gusenbauer's denunciation of protesters - mainly made up of the party youth organizations - didn't necessarily increase his popularity.

The solution to the SPÖ's Eurofighter conundrum was similarly self-defeating. The Eurofighter deal was very close to delivery of the first planes, yet the SPÖ had promised to cancel it. During the long period of coalition talks, the opposition parties, at the time still including the Social Democrats, had launched parliamentary hearings about both the procurement of new fighter jets and the recent banking scandals. The parliament decided that there should not be a settlement with Eurofighter until the hearing was finished. Yet, soon after the coalition agreement was finalized, the (SPÖ) Defense Minister unilaterally reduced the number of jets to fifteen, declared victory, and the new partners ended the hearings long before all the questions they were created to answer had been addressed.

Two additional measures the SPÖ took in order to enhance its chances in the elections came back to haunt it.

Firstly, in order to contain the political fallout of the collapse of the union bank, the party decided that union leaders should no longer sit in parliament. While probably necessary in order to win the election, it didn't make the still powerful unions happy.

The second measure was the installation of a new and surprisingly independent leadership in the ÖVP-dominated ORF (the national broadcasting company) with the help of all other parliamentary parties. Consequently, Gusenbaur's chancellorship never managed to put its own spin on events. The alliance with the Krone was probably conceived to counter the SPÖ's lack of sympathetic media.

All of the above added up to a sense that there was an ÖVP government with a red chancellor and made Gusenbauer's status inside his party ever more precarious. To counter his inner party critics, he decided to ally with Werner Faymann, the preferred candidate of the powerful faction of Michael Häupl, the mayor of Vienna. The ÖVP hoped that it could ride the chaos in the SPÖ all the way to the chancellorship, but now it looks exceedingly likely that it made a bad gamble.