The Hungarian government is set to impose a tax on internet usage, about €0.50 per gigabyte in a country where the average monthly salary is less than €800. Economy Minister Mihaly Varga laid out the proposal to parliament this week as part of a bigger plan to balance the budget, raise taxes or something. The bare-bones, all that has been available, shows internet service providers (ISPs) paying the Hungarian tax man, presumably passing it on to customers. Hungary’s biggest telecom Magyar Telekom saw an immediate drop in its share price on the news.
“A growing number of people make phone calls over the internet,” explained Minister Varga. Typical data traffic in Hungary could push the potential tax revenue to €600 million, said Deutsche Welle (October 22). Of course, internet access allows far more than cheap telephone calls. In June the Hungarian Parliament passed tax legislation on advertising revenues widely seen as an attempt to throttle foreign commercial television operators not under ideological control of Prime Minister Viktor Orban’s ruling right-wing Fidesz Party. (See more about media in Hungary here)
After howls and wails from internet users – including 100,000 Facebook page supporters of a Sunday (October 26) protest – Fidesz MPs, still favoring the tax, made noises about placing the tax pressure exactly where they want it. “We are recommending strict measures so that the telecom tax cannot be passed on in any form to non-business subscribers,” said Fidesz spokesperson Antal Rogán, quoted by portfolio.hu (October 22). “The tax payable on traffic generated by private individuals will need to be paid at the expense of the service providers’ own profit.” Magyar Telekom is principally owned by Deutsche Telekom.
“Unilateral internet taxes are not a clever idea,” said European Commission (EC) vice president for Digital Agenda Neelie Kroes, who leaves office at the end of the month, to the Financial Times (October 21). After winning the latest round of local elections for Fidesz, PM Orban said he’s building an “illiberal democracy.” Shortly thereafter the United States Department of Justice banned six unidentified Hungarians “either engaging in or benefiting from corruption” from entering the US.
Historic Serbian media brand B92 could disappear from television, reported Belgrade tabloid Blic (October 21), quoting unnamed sources. Founders and managers didn’t quite deny that the TV channel will be known as OTV from the first of the year saying only “the public will be informed” of any changes. News-talk radio station B92, originally B2, notably challenged the regime of the late former Yugoslav dictator Slobodan Milosevic from the early 1990’s.
In November 2010 long term shareholders Media Development Loan Fund (MDLF), now known as Media Development Investment Fund, and NCA Media exited as Swedish investor East Capital merged its interest with Greek proprietor Stefanos Papadopoulos to form Astonko as principal owner. The B92 Trust comprised of founders holds a minority interest and, according to covenants at the time, editorial control. Since the ownership change B92 TV has slowly but steadily increased emphasis on entertainment programming.
Starting as an opposition radio station, the B92 brand grew into television, internet distribution, production and music. The B92 radio station, apparently, will not be affected by the change and the B92Info cable TV channel will continue as a news channel. (See more about media in Serbia here)
Media watchers have long suggested hanky-panky in the 2010 ownership change, particularly the interest of Mr. Papadopoulos, who owns TV Macedonia. Serbia’s Commission for Protection of Competition began an investigation at the end of August into whether or not a relationship exists between Mr. Papadopoulos and Greek media house Antenna Media Group, which has principally owned Serbian TV channel Prva Srpska Televizija since the end of 2009. Antenna Media Group manages TV Macedonia for Mr. Papadopoulos.
Just when the furor about the arrival of Netflix in France, comes now to the Fifth Republic Vice News, described in Le Figaro (October 20) as “impertinent.” For starters Vice News is producing a Monday through Friday quarter-hour segment - Le Point Quotidien - airing on public TV channel France 4. A staff of six in Paris will create French-language material, also available on YouTube, and translate archive goodies.
The union representing French public TV journalists cried foul at the “privatization of public service information.” The SNJ “demanded” the broadcaster use only union member journalists for news programs. France Télévisions is disparate to get young people tuning in to France 4. (See more about media in France here)
“Like most people, we are groping to address a young audience that has a complex relationship with screens and for whom TV is no longer central,” said France 4 editorial director Boris Razon, quoted in Le Monde (October 21). “The Vice News journalistic approach is bold and that is important in the era of mistrust vis-à-vis the media.”
Vice News produces original, to be mild, news reporting, generally available on YouTube channels. France is its first destination outside the US; Germany, Spain, Brazil, Mexico and Australia to follow. It’s been described as a cross of CNN and MTV. This year Vice News has raised US$500 million in venture funding.
This will be a good year, said German private broadcasters association VPRT in it annual year-end forecast. The big money is still with TV and radio advertising. Biggest growth, unsurprisingly, will accrue to pay platforms and the web.
VPRT sees TV advertising ending 2014 at €4.24 billion, up 2.7% against 2013, and radio ad revenues at €750 million, up 1.1%. Online and mobile display advertising is expected to grow 6% to a bit over €1.2 billion with tele-shopping revenues up 4% to €1.8 billion. (See VPRT presser here – in German)
TV advertising in Germany grew 2.2% in 2013 over the previous year. The 2014 forecast pales against the 2000 peak of €4.71 billion. Radio advertising in 2013 was 3.7% higher than 2012. “Classic TV and radio remains the strongest segments,” said VPRT market development director Frank Giersberg.
Streamed video ads online will grow to €244 million, up 22%, and revenues from streamed audio ads online should be up about 30%, to €10 million.
The shift from ad to subscriber revenue continues to mount in Germany. Pay-TV and video-on-demand subscriptions will bring in €2.3 billion this year; pay-TV revenue up 12% and VOD subscription up 18%.
Pay-TV had been considered moribund in Germany, if not exactly dead. Sky Deutschland has beat the drum for pay-TV and is currently in the process of being folded into UK pay-TV company BSkyB. Subscription VOD has many holding their breath with all major German media houses entering that competition along with Netflix, Amazon and others. (See more on media in Germany here)
The VPRT forecasts are based on the considered opinions of broadcasting executives.
Of interest to publishers seeking new opportunities has long been the glow of the TV screen. The promise of big reach and big advertising, even brand extension, excites the executive office. And digital TV brought it all within reach.
Six months ago big Scandinavian media house Schibsted applied for and received a digital TV license in Sweden to be affiliated with big daily newspaper Aftonbladet, already operating a branded online TV channel. “This opens up exciting possibilities,” said publisher Jan Helin announcing the news in April.
That excitement faded. Last week the digital TV license was returned, with thanks. “We want to lead the trend rather than risk backing into the future,” said Aftonbladet TV director Jan Scherman in a statement, quoted by medievarlden.se (October 17). (See more about media in Sweden here)
“Since we got the permit last spring, the conditions for linear television have changed radically,” Mr. Scherman explained. “I have extensive experience in the television industry and have not experienced anything like it. Linear viewing behavior has now changed so fast… it is too high risk for a new TV provider to incur the costs.”
From Last Weeks ftm Tickle File
Taking aim at public broadcasting for one reason or another is a predictable pastime for politicians, typically of the right-wing variety. Cutting budgets and work-force at public radio and television channels allows, they say, market forces to deliver without encumbering taxpayers. And all politicians want to dabble in programming.
Entertainment shows should be struck from public broadcasting, envisioned Netherlands State Secretary for Education, Culture and Science Sander Dekker, reported news agency ANP (October 13). He doesn’t like Animal Crackers, Ranking the Stars and Bananasplit, currently offered by Netherlands public TV NPO. “If (entertainment) is the purpose of the program, you have to wonder if it doesn’t belong to commercial broadcasters.”
Public broadcasting in the Netherlands is unique, a multi-association collaboration funded by the State budget and advertising. Half that financial support should, said Mr. Dekker, be funneled to the private sector. “The public broadcasters do little to make themselves stand out and that damages their legitimacy.“ The government has mandated a reduction in the number of non-profit associations providing content to NPO channels in the spirit of efficiency, of course. (See more on media in the Netherlands here)
Mr. Dekker’s proposals would the NPO into “a narrow, elitist public broadcaster,” said KRO media director Taco Rijssemus to volkstrant.nl (October 17). “What the State Secretary doesn’t seem to understand is there’s not one set of public values. Precisely because those differences are significant, it is important that a public broadcaster give audience to pluralism.” KRO (Katholieke Radio Omroep - Catholic Radio Broadcasting) is one of the public broadcast associations.
German public broadcasters will finally be getting a national TV channel targeting young people 14 to 29 years. Approval from heads of government in the German Länder came with a caveat: the new channel can be broadcast only on the Web. The ARD and ZDF chiefs were a bit sad.
The political decision was “future-oriented,” said ARD chairman Lutz Marmor, noting a turn on new internet development for public broadcasters. Without broadcast distribution the launch will be “more difficult, but we’ll do everything to develop a good project to the net with ZDF.” The concept as presented to politicians would have merged all youth-oriented output of ARD affiliated regional broadcasters – including radio – into a single brand.
The State Ministers decided ZDFkultur and the WDR produced youth channel Eins Plus, currently on digital multiplexes, must go. The new and yet unnamed youth channel will have an annual budget of €45 million and largely rely on programming produced within the German public broadcasting system. Because it will be available only on the internet the three-step test for approving programming changes will not apply. Last March the State Ministers rejected the previous proposal for a national channel targeting young people as poorly thought through. (See more about media in Germany here)
German private broadcaster association VPRT was “relieved” by the decision complained of ARD and ZDF getting a “blank check of €45 million.”
The remaining foreign owners of Russian media outlets continue official silence on the fate of their businesses. As expected Russian Federation president Vladimir Putin this week signed into law deeper restrictions on foreign ownership and executive control. From the sidelines there’s considerable speculation.
Media watchers, mostly Western, have been focused on the fate of influential business newspaper and portal Vedomosti, owned by publishers News Corporation, through Dow Jones/Wall Street Journal (WSJ), Pearson, through the Financial Times (FT), and Sanoma. Each hold one-third stakes in Vedomosti. Under the new Russian ownership law, foreign shareholding of any media outlet will be limited to 20% by the end of 2016. (See more on media in Russia here)
“The Kremlin sees Vedomosti’s shareholders as foreign governments,” said editor-in-chief Tatiana Lysova to Bloomberg (October 17) “The WSJ equals the US and the FT the UK. They want a Russian owner so they have someone to call.”
German media house Axel Springer publishes business magazine Forbes Russia and Sanoma publishes Russian editions of Cosmopolitan and Esquire. These will likely close as trademark owners retain editorial control under license agreements, not allowed in the revised Russian media control law. Television broadcaster CTC Media will almost certainly be nationalized, if it exists at all, as Swedish media house Modern Times Group holds roughly a 37% stake and another 36% is publicly traded on the NASDAQ exchange.
Who or what may finally take control of these remaining foreign-owned media outlets in Russia is up for speculation. Not in doubt is the effective end of media voices with any independence from the Russian State. Perhaps seeking advice on media issues, President Putin paid a visit to former-Italian prime minister Silvio Berlusconi while in Milan, reported ANSA (October 17).
Radio listeners in Portugal are increasingly attracted to just two channels. In the May to September Bareme Rádio Marktest audience estimates Radio Comercial holds the top spot with 24.1% market share with RFM following with 21.6%, both showing year on year increases. Doing the math, that’s an aggregate market share of 45.7%. A year ago those top two channels had a combined market share of 40.5%.
Radio Renascenca, the general interest channel of Grupo R/Com, held 3rd place but dropped to 7.7% market share from 10.3% one year on. Radio Comercial is owned by Media Capital Radio and RFM is owned by R/Com. The two companies are tooth to tooth in the Portuguese radio market.
Public broadcaster RTP main radio channel Antena 1 placed 4th, up slightly to 6.4% markets share. Contemporary channel Antena 3 was also up slightly. (See Portugal national radio audience trend chart here)
Hit music Cidade FM moved to 6th place in the national rankings, 4.6% market share, sharply up from 3.8% year on year. News-talk channel TSF continued a long slow decline to 3.5% market share from 4.9%.