Flash report 6: Macedonia

Flash report 6: Macedonia
Local Media: In Vicious Cycle of Politics and Business
A weak local media that serve more the political and business elites lack quality and diverse local content that meets the needs and interests of citizens.  
The media landscape in Macedonia in the past 20 years has been marked by “quantitative pluralism” displaying a contradiction: on one side a large number of media exist on the market, and, on the other side, there is a lack of diversity and pluralism of content and low quality of the program offer.1 Apart from the Public Service Broadcaster, in total 64 commercial TV stations and 73 radio stations were broadcasting in the territory of the Republic of Macedonia as of January 2015. The media policy implemented so far has led to enormous fragmentation of the media market, which is economically weak, with very limited influx of commercials. The fragmentation and financial scarcity predominantly influence conditions for the local media, because there are too many TV stations at state level which have been attracting the biggest portion of the available advertising money. Struggling for survival, local media lack professional and technical resources in order to improve the quality of their work. Additionally, ethnic and political polarization of society makes the media inclined towards centers of power if they want to survive. The result, on one side, is weak local media that serve more the political and business elites, and on the other, lack of quality and diverse local content that meets the needs and interests of citizens.  
Quantitative vs. qualitative pluralism 
The local media market has been unstable since its liberalization in the early 90s, when around 300 illegal radio and TV stations operated. The Broadcasting Council (currently Agency for Audio and Audiovisual Services – AAAVS) awarded over 120 licenses to TV and radio stations in the first tender for licenses in 1998. Even this decision to bring some order did not reduce the large number of media and consequently the significant market fragmentation. That was mainly the result of the inconsistent policy of the regulatory body, especially after the adoption of the Law on Broadcasting Activity in 2005. Instead of a moratorium on further allocation of analogue frequencies for terrestrial broadcasting, a large number of licenses were awarded in the course of 2008 and 2009 both on national and local level. As a result, in 2011 the broadcasting market in Macedonia was more fragmented than ever before.2 Given the poor economy and small existing revenues from advertising, unhealthy competition practices ensued. This led to very unfavorable conditions for those media wishing to invest in their development. Additionally, connections with politics must not be neglected: media owners changed their political attitudes depending on who was in power, struggling to maintain other supporting businesses, thus choosing survival instead of independence.
In 2012 the Broadcasting Council concluded that commercial broadcasters were not able to operate and were facing extremely serious difficulties due to the underdeveloped economic environment, small influx of funding from advertising, large number of entities on the market, unfair competition among broadcasters, etc. The Council recommended reducing the number of entities, which was of crucial importance for efficient implementation of legislation.3
The process of regionalization, foreseen by the Law on Broadcasting Activity from 2005, did not improve the situation significantly, although it was expected to improve the quality of television services on regional level. By 2013 there were 10 regional media broadcasting in the territory of the capital Skopje only. The initial process of granting licenses to regional broadcasters failed in 2010, but 20 local TV stations were licensed in 2013. Currently, as of January 2015, 29 TV stations and 17 radios are broadcasting on regional level, while 23 TV stations and 53 radios have licenses to broadcast locally.
This high number of media also includes media that broadcast in the languages of minority groups. Apart from TV Alsat which broadcasts in both Albanian and Macedonian on national level, there are many local and regional media that broadcast in Albanian, Turkish, Roma, Vlach, Serbian or Bosnian language. The biggest Albanian ethnic community also has the biggest number of regional and local media. Initially, minority media were those that suffered the most. Some of them found ways to survive, some have barely survived, while others closed. An analysis made in 2010 by MIM4 says that the crucial problem for minority media was lack of content diversity, high quality programs and professionals. Still, it must be stressed that this is a direct result of a lack of funds – a large number of media divide the funds coming from the advertising market and the smallest media get the smallest portions. The MIM analysis revealed that due to the small public that minority media address, they do not attract either advertisers or the Government, which prefer national or bigger media to broadcast public campaigns. According to interviewees consulted in the MIM analysis, minority media got around 3% from the budget intended for public campaigns in 2010. 
Community or not-for profit media introduced by the Law on Broadcasting Activity in 2005 were seen as successors of the public local radios that were broadcasting in the languages of the ethnic communities, but this turned out to be a missed opportunity. So far, only one community radio received a license to serve the needs of the Turkish community, but it ceased working after a year. Additionally, three student radios, one regional and two local, work as not-for-profit media. The intention of the Law was to create perspective for further development of community media, because they are important for fulfilling the specific program needs of small segments of the public. Yet in the past years there has been a lack of reasonable regulatory policy, concrete ideas and measures for development of community media.5 At the very end of 2014 the Agency opened a public debate inviting stakeholders and citizens to offer ideas and suggestions for further development of this sector.6
State advertising as source of survival
Over the years, problems such as weak local markets saturated with a large number of media, clientelistic connections between media owners and political and business elites, unfair competition, lack of highly skilled professional journalists and poor program offer have persisted and affected the local and regional media in Macedonia.
The devastating situation of the local markets is due to the low economic power of companies that operate on local level, while big companies most often advertise in national media. In addition, direct and indirect political pressure on media is widely present. Representatives of local media have reported cases when local companies were pressured to withdraw ads from certain media. In a context in which the influx of funds from commercials is small, state advertising often remains the main source of financing for many local and regional media, thus increasing their dependence and opening channels for direct influence on editorial policy. According to AAAVS data, the Government was the second biggest advertiser for national TV stations in 2013.7 Broadcasters also complain that public campaigns are allocated in accordance with their editorial policy vis-à-vis the Government. Although the Government claimed it was offering transparency when publishing a list of national, regional and local media that broadcast public campaigns, the precise amounts for each media outlet were never disclosed.8
Comparative figures could better portray the situation of the local media markets compared to the total TV industry. The PBS MTV and commercial TV stations together had a total income of 2,934.06 million denars in 2013, out of which MTV and 5 national TVs had 87.79% of the total income of the TV industry. Five satellite TVs had 3.02%, regional TVs had 6.64%, while local TVs had 2.55% of the total income of the TV industry.9 Compared to the previous year, the total income of the TV industry was higher by almost 10%.
Source: AAAVS10
The process of regionalization brought new challenges to media that decided to transform from local to regional. Despite higher fees for licenses for regional broadcasting, the new Law on Audio and Audiovisual Services prescribes other criteria which on one side are supposed to ensure diversity, pluralism and high professional standards in programs, but on the other side – increase the need for investments in media, thus creating an additional financial burden. The Law imposes requirements regarding the amount of in-house production; quality, genre and thematic diversity of content, which should enhance media diversity and pluralism; technical conditions for production of programs; suitable premises; number and structure of employees; while local and regional media are also supposed to produce programs that will offer information important for the area of broadcasting. In 2013, 17 out of 27 local TV stations had less than 5 employees, while 18 regional TV stations had less than 10 employees. Among local TV stations, 6 had only 2 employees, while 7 had only one employee in 2013.11 In the future, the Agency will ask regional TV stations to have a minimum of 10 employees, out of whom 5 will have a higher education in order to be able to work as journalists, while local TV stations should have a minimum of 5 employees, out of whom 3 with a high education.
In reaction to the difficult economic situation faced by local media, the Association of Private Media of Macedonia was established in 2012. Its founder, now the ex-president, Saso Mitanoski, explains some of the obstacles for local media: “The small portions from the advertising pie for local media, the division into politically ‘adequate’ and ‘non-adequate media’, new legislation and digitalization which financially ‘squeezed’ the media, have all faced the local broadcasters with a serious danger to their survival. The situation that local media have found themselves in is worsening and the number of colleagues who cannot endure the situation has been increasing in the past years. Therefore, many media changed their ownership or simply closed”. Mitanoski suggests that funds for supporting projects of public interest, abolished by the Law on Broadcasting Activity in 2005, should be returned and allocated especially to local and regional media since they are the most endangered. 
As a curiosity, it must be noted that, while initiatives for support of diversity and pluralism of local and regional media are missing, national TV stations, which are the richest media, will be able to receive subsidies from the budget for production of domestic documentary and film programs in the amount of 50% of their costs, as foreseen by the new Law on Audio and Audiovisual Services. 
Political “invasion” at local level?!
All local and regional media in Macedonia are in private hands, since the Law on Broadcasting Activity from 2005 foresaw the transformation of local public broadcasters into private or not-for-profit media. Transparency of ownership is a legal obligation for broadcasters and is monitored by the Agency. Although formally the situation with media ownership is clear, hidden connections still exist between media and centers of power, while the Agency does not have the power to investigate this issue. The question of ownership is important since it has a big impact on freedom of expression and integrity of media.12 Many local and regional media nurture close connections with the political and business elites on local and central level in order to attract commercials, public campaigns or political advertisements during elections. After 2008, the Government tightened the pressure on media, while owners who supported the Government got the largest portions of public campaigns. The dependence of media increased, narrowing down the space for critical journalism. 
MediaPedia, a website that publishes investigative journalism stories, revealed a new pattern of possible political “invading” of regional media. The website disclosed that in 2013 three anonymous citizens of the capital Skopje each established a company on the very same day.  Ten days later, again on the same day, they bought two local TV stations each. The TV stations are from different regions in Macedonia and their total value was 118,000 euro. Some of these TV stations started the process of transformation from local to regional, some changed their names, while some moved their seats from one city to bigger regional centers. According to scarce information from the media and speculations, the owners plan to make significant investments in equipment.13 While the new owners are relatively unknown in the public and the website does not have proof of their interconnection, the only string that connects them is the allocation of public campaigns. Namely, until 2014 public campaigns were more or less equally allocated among a number of local and regional media. In 2014 these 6 TV stations under the management of the new owners suddenly started receiving hundreds of advertisements more than other TV stations.14 The website did not receive any answer from the Government on what was the exact amount these TV stations received from the budget. 
Although local media should pay more respect to the needs of local audiences, citizens are not using local media as sources of information for daily news.15 Local and regional media should be motivated and supported to offer information of local and regional importance to local audiences, which is foreseen by the new Law on Audio and Audiovisual Services. This will improve genre diversity since in the current situation a very small number of media are demonstrating a serious approach to diversity of programs. Ensuring media pluralism and diversity of content also means ensuring greater independence of media from political and business centers of power and increased professional standards in work and media products. Therefore, political subjects and regulatory bodies should ensure fair and equal treatment of all media which should compete under the same circumstances on the market. Finally, local and regional media should loudly stand for protection of their own interests by launching initiatives and engaging industry associations.
1 MIM (2012) Development of Media in Macedonia according to UNESCO Indicators. Skopje:  MIM. Pg. 41
2 Ibid, p. 47-48
3 Ibid, pg. 39
4 MIM and VSNOJ (2011) Sostojbata so mediumite na jazicite na zaednicite vo Republika Makedonija. Skopje: MIM. Pg. 4
5 Ibid, pg. 8
6 Agency for Audio and Audiovisual Services. Source: http://www.avmu.mk/index.php?option=com_content&view=article&id=1976%3A2...
7 Agency for Audio and Audiovisual Services (2014) Analiza na pazarot na radiodifuzna dejnost za 2013 godina. Pg. 33
8 See Government of the Republic of Macedonia: http://vlada.mk/node/9241 
9 Agency for Audio and Audiovisual Services (2014) Analiza na pazarot na radiodifuzna dejnost za 2013 godina. Skopje: AAAVS. Pg. 9  
10 Ibid, p. 4-7
11 Ibid, pg. 56
12 MIM (2014) Country report: Macedonia. Zosto e vazen integritetot na mediumite. Skopje: MIM. Pg. 72
13 MediaPedia (2014) “Nova mediumska zetva vo vladioniot reklamen kombajn”. Source: http://mediapedia.mk/istrazuvanja/nova-mediumska-zhetva-vo-vladiniot-rek...
14 Ibid.
15 As shown by the Broadcasting Council’s monitoring in 2007, 2009 and 2012. See: http://www.avmu.mk/images/stories/Predlog-Strategija-i-Akciski-plan.pdf
Media Ownership and Finances