The process of awarding new digital frequencies to private television stations has been marred by rows, delays and court cases.

This investigation was originally published on Reporter.al, the award winning online publication of the Balkan Investigative Reporting Network in Albania.

Gentian Sala, the head of Albania’s Audiovisual Media Authority, AMA, faces a fresh headache.

Italy and Montenegro are demanding that Albania stops its television stations from interfering with their mobile telephony networks.

The complaints come after Albania failed to switch off its analog TV transmissions by the June 17 2015 deadline imposed by the International Telecommunication, ITU.

Albania is one of a handful of countries in Europe that failed to complete the process by the deadline.

The ITU says Albania can continue to broadcast in analog if it wishes, but only if it avoids interfering with its neighbours’ airwaves.

“Countries like Albania, which have not implemented the switchover, will have an obligation to immediately resolve any harmful interference that may occur, either affecting neighboring countries that have implemented the transition or emanating from other sources,” Sanjay Acharya, head of media communications at ITU, told BIRN.

For the AMA, the complaints from the two neighbours are an extra blow on top of existing delays to the digitalization agenda.

In his office in Tirana in a half-ruined building shared with two small political parties, Sala hesitates to speculate about the risks Albania faces if the complaints are not dealt with.

Gentian Sala, the head of Albanian's Audiovisual Media Authority during a hearing in Parliament. Photo: Light Studio Agency

But the AMA chief admits that Albania has been branded “a black sheep” in Europe for failing to carry out its digitalization process on time, and that pressure from Brussels is mounting.

“The European Union has sent us signals to finalize the process as soon as possible”, he told BIRN.

As head of AMA since last year, Sala has headed the tendering process for the distribution of digital frequencies to private TV broadcasters - without handing out a single license, however.

His previous work experience in one of the operators vying for a share of the frequencies has also caused the 37-year old lawyer controversy.

The tender opened by AMA has been marred by accusations of conflicts of interests and claims that it favours a media conglomerate comprising the broadcasters Digit-Alb, Super Sport and Top Channel over their competitors, Media Vizion - which owns Vizion Plus TV - and Tring TV.

“The procedure was laughable from start to finish and is creating a monopoly in the pay-per-view market”, Genc Dulaku, owner of Vizion Plus, has complained.

Sala rejects the accusations, underlining that his work at AMA is guided by the law, which sets out which companies may be invited into the contest and qualify for digital frequencies.

“I have no regrets and have not favoured anyone because the law is transparent in this regard”, Sala said.

Alban Jaho, from Digit-Alb, told BIRN that Vizion Plus had misjudged the decision-making process concerning the distribution of digital frequencies.  

“The attack from Vizion Plus came before the AMA has even taken a decision”, he said.

Market in chaos:

The audiovisual broadcast market boomed in Albania over the past decade but technological advances have encountered legal vacuums and a lack of a regulatory framework. The market remains chaotic and often fraught with illegality.
 

But the AMA chief admits that Albania has been branded “a black sheep” in Europe for failing to carry out its digitalization process on time, and that pressure from Brussels is mounting. “The European Union has sent us signals to finalize the process as soon as possible”, he told BIRN.

AMA data show that 72 private television stations operate in Albania. Apart from the public broadcaster, RTSH, Top Channel and Klan TV also have national broadcasting licenses.

Digit-Alb and Tring TV are pay-per-view platforms. The rest are local or regional broadcasters.   

Several of these broadcasters are in debt to AMA after failing to pay their licensing tariffs and others obligations. According to AMA’s 2014 annual report, TV broadcasters owed the agency 48 million lek  [€353,000].

As long ago as 2004, nine broadcasters were already transmitting programmes numerically even though digital broadcasting licenses had yet to be awarded.

In June 2012, the former centre-right government of Sali Berisha approved a national strategy for switching over from analog broadcasting to numeric.

However, following the change of government in 2013 and the change at the helm of the AMA, the process of awarding the new digital broadcast licenses became stuck.   

By the time Sala was nominated head of AMA in November 2014, a previous procedure to distribute seven digital TV frequencies – two of them for the public broadcaster - had been struck down in court.

Sala says that apart from being an international obligation, the process of digitalization is a chance to legalize existing operators in the market that have usurped frequencies and are not paying their tariffs to the AMA.

“The existing operators want to legalize what they already do”, he said.

Albania’s Minister of Innovation, Milena Harito, agrees, arguing that the digitalization process is a chance to bring the chaotic TV broadcasting market in Albania back into a legal framework.

“The AMA took the decision to license five networks to legalize operators that are already considered historic”, she told BIRN.

Disputes dog tender:

AMA announced the tender procedure for the five licenses that were to go to private broadcasters on April 23, 2015.

The broadcasters invited to participate were selected through two criteria; they either had to have a national TV license or have experience in digital broadcasting.   

Those selected were the national television stations Top Channel and Klan TV and the two existing digital broadcasting platforms, Digit-Alb and Tring TV.
 

After Super Sport became a source of tensions between the AMA and broadcasters, Sala told BIRN that AMA’s administration has recommended to its board that Super Sport’s qualification for a digital license be left to a second phase, and that only three licenses would be awarded in the first phase. “Its shareholder structure is against the law”, Sala said. 

The one surprise in the selection process, known as the Beauty Contest, was Super Sport, a company that had not been involved in the previous procedure struck down by the courts.

A digital sports broadcasting platform, Super Sport is wholly owned by Digit-Alb and headed by the same director.

The day the contest was announced, Super Sport had passive status as a business in Albania’s national business registration centre.  

On April 24, it became again active and raised its capital to 35 million lek (€250,000), the threshold imposed by the rules of the Beauty Contest.

However, following the inclusion of Super Sport, Vision Plus TV, which is part of the Media Vision group together with Tring TV, cried foul.

A representative of the group, Genc Dulaku, said the distribution of digital TV licenses by the AMA clearly favoured the conglomerate made up of Top Channel, Digit-Alb and Super Sport.

Media Vizion then filed a lawsuit in Tirana’s District Court, aiming to block the contest.

After filing the lawsuit, Media Vision pulled Tring TV platform from the Beauty Contest, in protest.

Dulaku told BIRN that the AMA was a “captured” institution. “This institution is protecting a monopoly and we are the first to fall victims,” he said. “After us, others will also face problems”, he warned.

Sala’s professional background also fed concerns that the authority favoured Digit-Alb.

In his CV sent to parliament, Sala declared that from 2008 to 2009 he had been the administrator of e-Solutions, a company wholly owned by Digit-Alb.

Sala rejects allegations that he is helping to create a monopoly in the digital TV market, and says Vizion Plus did not qualify for the contest because it did not meet the criteria.

“Vizion Plus has no national license and no experience in digital broadcasting”, he said. “This operator has no license at all because it has not paid its duties for the last seven years to the AMA”, he added.

After Super Sport became a source of tensions between the AMA and broadcasters, Sala told BIRN that AMA’s administration has recommended to its board that Super Sport’s qualification for a digital license be left to a second phase, and that only three licenses would be awarded in the first phase. “Its shareholder structure is against the law”, Sala said.

Jaho, from Digit-Alb, told BIRN that the company had not been presented yet with AMA’s full decision to disqualify Super Sport. However, he maintained that the company met all the criteria to be part of the contest.

“Super Sport has been a pioneering operator in numerical broadcasting in Albania and fulfils the criteria”, he said.

“As for the ownership restrictions in the current legislation, we consider them useless for the development of the media market and, more specifically, as no guarantee for free competition and the plurality of the media market in general”, Jaho added.

As a result of Tring TV pulling out and the apparent disqualification of Super Sport from the first phase, AMA has two extra digital frequencies to award.

Sala says Vizion Plus is not seeking a frequency any longer. “They were offered a frequency that they don’t want”, he said. “It’s no secret here that in this kind of process everyone is interested… from politicians to the media commission”, he added.

Clearing up ‘two-faced’ ownership:

AMA’s draft regulations for the contest prescribe a 60-day deadline for the award of licenses after broadcasters apply.

The deadline has long gone but the head of AMA remains determined to push on with the procedure.  

The time limit for the digitalization process is only one of the problems that AMA faces.
 

“We should… admit the truth that the battle for media ownership in Albania has been lost”, he said. While the owners of these outlets are often well known, their business registers extracts are full of the names of family members and friends listed as shareholders, he added.

The main problem is with the ownership of the operators that remain in the race, which has fuelled a debate about media concentration in Albania.

The law on audiovisual media in Albania, adopted in 2013 with assistance from international organizations, imposed clear restrictions on the ownership of TV broadcasters.

Article 62 of the law reads that a “person or entity cannot own more than 40 per cent of the shares in a company that has been awarded a national broadcasting license.”

Of the four operators still in the race, Top Channel and Klan TV meet this criterion but Digit-Alb and Super Sport do not.

The heirs of the founder of the pay-per-view Digit-Alb platform, Dritan Hoxha, control 51 per cent of the shares. Digit-Alb wholly owns Super Sport.

In May 2015, the Socialist MP Taulant Balla introduced a bill to amend article 62 of the audiovisual media law, removing all ownership limits.

But the “Balla amendment” drew stiff opposition from the European Union and the OSCE.

In a letter sent to parliament in June 2015, the head of the EU Delegation in Albania, Romana Vlahutin, expressed concerns over the impact of this amendment on the media scene.

“The amendment will negatively impact competition among audiovisual media, creating a risk of monopolism and provide for media groups’ concentration and therefore have a negative impact on media freedom in Albania”, Vlahutin wrote.
 

Written opinion of the head of Europian Union Delegation in Albania, Romana Vlahutin, who express a serious concern for the atemp on abolishing the ownership limitations in Albanian media.  

The representative on Media Freedom in the OSCE, Dunja Mijatovic, and officials from the Council of Europe took the same line and forced the ruling majority to drop the amendment.

The head of the AMA’s opinion on the amendment was at odds with the international representatives, however.

In a letter sent to parliament, on May 13, 2015, Sala wrote that he approved of the removal of ownership restrictions, although he said barriers on any television station receiving more 30 per cent of the advertising share should remain.   

Nine months on, Sala defends his argument, arguing that the amendment was chance to clear up the business of hidden ownership of the media, which he called two-faced.

“We should… admit the truth that the battle for media ownership in Albania has been lost”, he said.

While the owners of these outlets are often well known, their business registers extracts are full of the names of family members and friends listed as shareholders, he added.

“Had the amendment been passed, you can bet that the next day some of these shareholders would have been removed”, Sala said.

While this “two-faced” ownership structure continues, the AMA says it has asked Digit-Alb to fix its shareholder concentration in line with the law so that it may obtain a numeric license.  

Delays draw growing criticism:

The International Telecommunication Union, ITU, describes the process of digitalization in Albania as long and complex.

The 2015 European Commission progress report on Albania also contained criticism of delays in the process.

“While the implementation of the strategy for switching from analogue to digital broadcasting resumed in 2015 - after the conclusion of a court case brought against the regulator by some broadcasters - the internationally agreed deadline for June was not met”, the EU wrote.

“Substantial efforts are needed to implement the digital switchover as soon as possible”, it added.

In the strategy that Albania’s parliament approved in 2012, the public broadcaster RTSH was assigned the role of engine in the digitalization process.
 

“RTSH has kept the process hostage”, Sala said. “Had it moved faster, the pressure to resolve the problems with the private broadcasters would have pushed them forward”, he concluded.

After building two networks through an international tender, RTSH would serve as a host for existing regional and local broadcasters, drawing them in the digital age.

In parallel with this, it was planned that AMA would license the private operators in order to complete the process.

However, the digitalization tender for RTSH held by the previous Minister of Innovation, Genc Pollo, was contested in court.

The current Minister, Milena Harito, told BIRN that the process had been delayed by the legal challenges to the public broadcaster’s tender and by AMA’s procedures to license private broadcasters.

The process restarted in March 2015, when the government signed a contract for 21.5 million euro with the German company Rohde & Schwarz to construct two networks for RTSH. The AMA launched the “Beauty Contest” a month later.  

“Within six months of the start of the project, RTSH will cover 85 per cent of the territory”, Harito told BIRN in June 2015. As it turns out this deadline was not met.   

According to the AMA, the problem with the public broadcaster has centred on the process of determining tariffs for the regional broadcasters that it will host.

The switch from analog to digital of 70 regional broadcasters and hosting them on its two networks will come at a cost for RTSH.

Sala says that RTSH first proposed a monthly tariff of 2,700 euro, which he said was too high.

“We hope the digitalization will help regional and local broadcasters, and not impose extra burdens on them”, he said.

They opposed the stiff costs of the digital switchover at a meeting organized by the AMA a few months ago.

RTSH then proposed a second tariff to AMA, but even that is considered inflated. Regional and local broadcasters still do not know what costs the digital switchover will entail.   

Sala blames RTSH for the delay in the switchover from analog broadcasts to digital.  

“RTSH has kept the process hostage”, Sala said. “Had it moved faster, the pressure to resolve the problems with the private broadcasters would have pushed them forward”, he concluded.

This article has been produced with the financial assistance of the project South East European Media Observatory, supported by the European Union. The contents of this article are the sole responsibility of Aleksandra Bogdani and Besar Likmeta and can in no way be taken to reflect the views of the European Union.