Reports

October 11, 2016

Media Ownership Monitor: Ukrainian media prone to power plays more than ever

Screen capture from http://ukraine.mom-rsf.org

Ukrainian mass media outlets are mostly driven by their owners’ individual interests and thus serve as instruments to securing political and economic power. Corruption and lack of financial transparency further inhibit the healthiness of the country’s media landscape. These are some of the main findings of the Media Ownership Monitor (MOM), a research and advocacy project carried out in Ukraine by Reporters Without Borders (RSF) and the Institute of Mass Information (IMI) over the past three months and presented in Kyiv today. The detailed results of the three-month study are now available to the public on the MOM website at http://ukraine.mom-rsf.org in English and Ukrainian.


The research also showed that TV and radio markets are particularly concentrated, mostly due to missing or dysfunctional safeguards for effectively controlling media oligopolies. Corporate structures of major media companies are disguised in offshore havens, which allow the owners to bypass existing legal requirements.


"The Media Ownership Monitor has allowed us to reveal the intricate links between politics and business and how both sustain each other. Weak regulation means anyone with just about enough money and connections can use the powerful tool that a mass media outlet presents as their personal PR machines, allowing owners to manipulate the public into buying their goods, voting for them or pushing for laws that will make them even more powerful,” said Nafisa Hasanova, RSF’s MOM Ukraine project manager.


The IMI’s coordinator for the project, Maksym Ratushnyi, added: “By scrutinizing the media sector, our research confirms a prevailing perception: Ukrainians live in a typical country of crony capitalism, a system where business can succeed only through close association with the political elites and vice versa.”


The results of the study demonstrate that oligarchs occupy a special place in Ukraine’s media landscape. It is not a secret to ordinary Ukrainians who owns the most popular national TV channels in the country. For the first time, however, this comprehensive study reveals the economic and political interests behind these ownership structures. In addition, the website makes an easily accessible, searchable and user-friendly catalogue of media ownership available to every citizen.


POLITICAL INFLUENCE OVER THE MEDIA IS EXTREMELY HIGH


Some individuals control vast sectors of the country’s economy, and the media industry is not an exception. Political influence over the media remains extremely high. Ten out of the twelve most important TV channels selected for the study are linked directly or indirectly to political personalities. The radio market is equally marked by ownership structures too close to the ruling classes.


The study reveals that the audio-visual markets are highly concentrated, as the major four TV owners – StarLightMedia, 1+1 Media, Inter Media and Media Group Ukraine – represent an audience share of more than three quarters. These media groups belong to some of the richest individuals in Ukraine, namely Viktor Pinchuk, Ihor Kolomoyskyi, Dmytro Firtash and Rinat Akhmetov, respectively.


The top four radio groups, for their part, even combine a reach of 92% of the audience in Ukraine: Tavr Radio Group, Ukrainian Media Holding, Business Radio Group and TRK Lux. Three out of these four major groups belong to some of Ukraine’s richest, the exception being TRK Lux which is owned by the wife of the mayor of Lviv.


The print media and online sectors are less concentrated. Online media in particular offer much more pluralism and choice to Internet savvy Ukrainians even though they remain unregulated by any laws in the country.


The MOM’s findings also show that the country’s major media groups have very complex structures hidden offshore. Cyprus, British Virgin Islands, Hong Kong, Seychelles, Samoa, New Jersey, Belize are among the locations where some of the owners hide their assets from the Ukrainian public – regardless of a Ukrainian law explicitly prohibiting residents of offshore jurisdictions to own media companies. Shadow economy, however, remains quite significant. All this contributes to an unhealthy state of the media market in which, as a result, financial information is considered far too sensitive for the industry to disclose and thus remains intransparent.


Concerning Ukraine’s legal framework, the MOM results show that some promising attempts have been made to shed light on media ownership, in particular through the adoption of a law aiming at greater media ownership transparency in 2015. Nevertheless, not all media companies have revealed their owners yet.


Regulatory safeguards for controlling media concentration are still missing and the implementation of existing legal provisions stalls. For example, no objective criteria for measuring the market and media concentration have been defined yet. Regulatory authorities such as the National Council and the Anti-Monopoly Committee refer to the lack of legislation to assess concentration, as well as to the marginal level of possible sanctions. A lack of political will to reform and to regulate the media market, just as any other market, derives from the fact that politics and business are too cosy with one another.


Last June, RSF already published a mission report about Ukrainian media’s situation, titled “Facing reality after the Euromaidan. It describes the fragile situation of a country in which journalists are generally able to work freely and engage in investigative reporting, but yet face immense problems. The report also looked at concentration of the main TV networks in the hands of a few oligarchs, and at the difficulties of independent media outlets trying to develop functional business models.


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The Media Ownership Monitor Ukraine was carried out by Reporters Without Borders in partnership with the Institute of Mass Information in Kyiv between July and October 2016. The project studied the legal environment, media concentration and ownership structures of the country’s 43 most popular national media outlets.


MOM is an international project launched by the international press freedom watchdog Reporters Without Borders. It is has been or is being carried out in eight countries worldwide, including as Turkey, Tunisia, Columbia and Cambodia. The Project is funded by the German Ministry for Economic Development and Cooperation (BMZ).


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Media Contact:


Reporters Without Borders Germany

Ulrike Gruska / Christoph Dreyer / Anne Renzenbrink, media relations officers

presse@reporter-ohne-grenzen.de

Tel.: +49 30 60 98 95 33-55


Institute of Mass Information

Maksym Ratushny

info@imi.org.ua

+380 63 239 64 16