In late January the television channel TV-6 was taken off the airwaves after the Press Ministry implemented a court order that the channel’s parent company be liquidated, which essentially robbed its owners of their assets. This took place almost two years after the ownership of another television channel, NTV, changed hands under similar circumstances. While the NTV incident was accompanied by scandal, in which the Russian authorities were criticized internationally for curbing freedom of press, the TV-6 closure–though described widely in the press as marking the end of Russia’s “last independent TV station”–was commented on with restraint both inside and outside the country. And perhaps rightly so. A closer look at the conflict suggests that genuinely independent media is a rarity in Russia. The reason for this should be no surprise: There is no developed market for media products and may not be for a long time, given that the main factor in its development–the audience–has been grossly neglected by all the parties in both conflicts.
HOW TO BE INDEPENDENT IN RUSSIA?
In any country, truly independent mass media are those that generate enough money to sustain themselves. If a media outlet depends on the financial support of the owner, it becomes very vulnerable to influence–political, financial or otherwise. What difference does it make, then, whether it is owned by the state or by an individual? If the books are not in order, it is dependent. By this standard, there are very few independent mass media in Russia because there is no developed market for media products. And an underdeveloped economy means that advertising revenues are small.
Indeed, the advertising market has been directly affected by the Russian economy’s ups and downs. According to the daily newspaper Kommersant, the advertising market grew to US$2 billion in the first half of 1998–120 percent higher than in the same period of the previous year (in 1997, the whole of the market accounted for US$1.845 billion)–and was expected to grow another 30-40 percent by the end of the year. But the August 1998 financial crisis reduced the volume of advertising on television and in the print media by four times. Television was hit particularly hard, with ad revenues dropping by 70-80 percent and radio ads by 60 percent. Advertising rates hit rock bottom. The advertising market underwent drastic changes, with media of all kinds reorienting from big-budget advertisers towards those with just US$5,000-$10,000 to spend. One of the two companies controlling the market, Premier SV, closed down, and the media-buying business was practically monopolized by the Video International company, which seized some 70 percent of the market.
As if the financial crisis were not enough, in August 2000 the Ostankino television tower caught fire. According to Kommersant, advertisers lost up to US$4.5 million for each of the three weeks that the major television channels’ signals were disrupted. Last but not least, political factors also had a negative impact on advertising. When Gazprom, the state-controlled natural gas monopoly and NTV’s main creditor, moved to out the channel’s owner, Vladimir Gusinsky, citing the channel’s debts, NTV, which advertisers had long considered the most attractive channel, was selling a prime time ad slot for as low as US$500.
Still, signs of recovery eventually appeared. According to a yearly report published by the Russian Advertising Council in September 2001, the advertising market in 2000 was worth US$1.1 billion, a 45 percent growth over 1999. Television accounted for the single largest share of that market–33.5 percent, worth about US$300 million. Advertising in the print media accounted for 29.8 percent of the total (US$240 million)–down three percent from the previous year. In radio broadcasting, the leading FM stations, such as Russian Radio, were able to attract US$60,000 a month in advertising money. Meanwhile, the provincial advertising market’s share of the total grew from 22 percent in 1999 to 24 percent in 2000, totalling US$260 million.
Russia has obviously been the most attractive of the former Soviet republics for advertisers. In Ukraine, for example, which has the second-largest economy in the region, the total advertising market does not exceed US$270 million. Experts believe that in 2001 Russia’s advertising market exceeded the pre-crisis 1997 level (the exact figures are not yet known). It is still very small by Western standards, however, at just US$7.5 per capita, compared with US$200-300 per capita in Western Europe and US$800 in the United States.
HE WHO PAYS THE PIPER CALLS THE TUNE
So it took the Russian advertising market three years to overcome the consequences of the 1998 financial crisis–three years that were practically lost for the development of an open and stable mass media market. Starved for funds, mass media outlets are always fishing for money and not particularly touchy about its sources. One incident illustrates the worrying state of affairs well. In February 2001, Promaco, a start-up PR company from St Petersburg, aiming to highlight media corruption, offered all the country’s major national periodicals bogus advertising material about the opening of a non-existing shop. Thirteen of them published it as a regular news article but accepted payment for it. The case cast a bright light on the mass media’s shady practices. In the provinces, where the advertising market is very narrow and the population often poor, mass media are easy prey to influence, both financial and political, and is in fact often fully controlled by the local authorities.
In addition to the lack of advertising money–which is, after all, determined by the general health of the national economy–there is also in Russia a strong tradition of what might be called economic infantilism. A media outlet would rather become an instrument of influence by finding wealthy sponsors then struggle on its own in the rough waters of Russia’s free–and often wild–market economy in order to become profitable. Given the atmosphere of extreme political favoritism that was characteristic of President Yeltsin’s time in the office, when individuals’ status and wealth were dependent on their ability to get “close to the throne,” it was hardly surprising that Russian mass media, divided between a few so-called oligarchs, reflected the problems of society in a crooked mirror of their owners’ clan struggles.
It was then that the seeds of the later political scandals surrounding the Russian mass media, particularly NTV and TV-6, were sown. A number of individuals who had helped Boris Yeltsin get re-elected in 1996 were later “rewarded” with virtually unlimited access to the state resources. One of them, Vladimir Gusinsky, was smart enough to use these resources to develop his NTV channel into Russia’s leading TV station, with quality news broadcasting, top technology and the best presenters. But he created a new business using old methods and attitudes, borrowing freely from state-controlled companies like Gazprom and Sberbank, with apparently little intention of paying them back.
Moreover, with NTV having played a major role in turning the tide of public opinion in support of President Yeltsin against his major rival in the 1996 presidential campaign, the Communist leader Gennady Zyuganov, Gusinsky got used to seeing himself as a king-maker. During the parliamentary and presidential campaigns of 2000-2001, Gusinsky decided not to support either the Unity party, a new “party of power,” or Vladimir Putin, whom Yeltsin had named as his successor, unlike Gusinsky’s rival, Boris Berezovsky, who then controlled Russian Public Television (ORT) and helped Putin become president. But while the Unity party and Vladimir Putin came out the winners, none of the oligarchs did. With his steely determination, the new president took just a few months to put an end to the political influence of the oligarchs, their misuse of the mass media for their own ends and to freedom of the press–at least in the old sense of the term, meaning being free to say what their owners wanted. The number of those who pay the piper, as well as financially viable media outlets, which play their own tunes, has drastically reduced.
A MYTH OF INDEPENDENCE
Each profession creates its own myths. In Russia it has already become a cultural tradition to consider a media outlet “independent” if it is critical–what or about whom does not really matter. The same can be said about individual journalists: some of the best known are considered to be “independent” just because from time to time they publish “sharply critical” materials about this or that which are heavily peppered with pathos and moralizing. More often than not, they are supplied with such materials by interested parties.
As good professionals–that is, having a good command of the craft–journalists should be able to do their job well in any place. This is not always the case in Russia. Thus, during the NTV scandal a group of its journalists decided they could be good professionals only under a certain leadership and when the channel changed owners, they left for another channel–TV-6. Instead of being “independent”–that is, doing their job well wherever they are–they went from one owner to another, from Vladimir Gusinsky to Boris Berezovsky, who, ironically, had previously been the target of much of their the very one whom many of them had previously devoted much of their “sharply critical” materials. As the closure of TV-6 loomed, these “independent” journalists changed their minds several times, first defending the channel, then opting to form a new company without Berezovsky out and then changing their mind once again. The irony became surreal following TV-6’s closure: in seeking to start a new TV channel, these same journalists have turned to some of the people they criticized most severely in the past. These include Roman Abramovich, the oligarch and governor of the Chukotka province, whom the old NTV-turned-TV6 team often denounced as the key man in the “Family”, influential group of Yeltsin-era Kremlin insiders.
In both the NTV and the TV-6 conflicts, neither side thought about the audience. TV-6 is now filled with free sports programming supplied by the NTV Sport-Plus satellite channel, which has raised the ire of those viewers who have already paid for the same programming. Nor has anyone thought about those people who worked at TV-6 but were not part of its “elite” and thus denied a voice in deciding the channel’s fate. These included editors, technicians, and many others who have suddenly had to look for new jobs. The economy might be on the rise, but if it remains customer-unfriendly, the effects of this rise will hardly be felt. After all, who would subscribe to or place an ad in mass media that do not consider the interests of viewers or clients and could be shut down overnight?
Elena Chinyaeva, who holds a doctorate in modern history from Oxford University, is a writer with the leading Russian political weekly Kommersant-Vlast.