Moscow, 20 May 1997 (RFE/RL) - In less than a month, a new nationwide television network will start broadcasting in Russia. The new network, named TVCenter, comes to life with the financial support of the Moscow city authorities. Observers in television circles are already calling it "Luzhkov's television," openly connecting the presidential ambitions of populist Moscow Mayor Yury Luzhkov with its appearance.
At the moment, there are three television networks broadcasting nationwide. They include the state-controlled RTR, the partially state-owned ORT and the commercial network NTV, controlled by the financial group MOST through its media branch, Media Most.
Last year's presidential elections represented a turning point for Russian media. During the pre-electoral campaign, newspapers, magazines and particularly TV channels played a key role in boosting President Boris Yeltsin's ratings from single digits to his election victory against Communist party leader Gennady Zyuganov in July.
Observers say the economic and political dividends of this support was evident, particularly for the major private share-holder of ORT television, as well as for the commercial NTV channel. NTV obtained permission in September to broadcast nationwide, 18-hours per day. Previously, NTV was broadcasting six hours per day, and only to Moscow and European Russian regions. And, Boris Berezovsky, a businessman holding the bigger private stake of ORT, was appointed Deputy Security Council Secretary in October.
One of NTV's leaders, Igor Malashenko, told RFE/RL that he "categorically does not agree" with observers saying that only the presidential elections gave NTV the possibility to go nationwide so quickly and smoothly. However, Malashenko did not deny the role played by NTV in supporting Yeltsin's re-election bid.
Over the last few years, but particularly after the 1996 elections, Russia's main financial and industrial concerns have fiercely competed to buy media properties. Russia's media magnates often say they are not looking for immediate profits, since usually the broadcasting and newspaper business takes more money than it yields. Financial, industrial and political interests are widely seen as seeking out media branches to serve as conduits for self-promotion and political influence.
Following his appointment to the Security Council, Berezovsky said he had delegated all his business commitments, including his role in ORT's board of directors.
ORT, the first channel of Russian television, stands for "Public Russian television." During the Soviet era, the first channel, (eds: then Central Television) was the main mouthpiece of Communist propaganda throughout the country. According to polls quoted by Moscow University's Journalism Faculty, ORT programs are still viewed by 98 percent of the Federation's population. After the disunion of the USSR, the channel, renamed Ostankino, started decentralizing its broadcasting system, as ideology was loosing its grip on the media. In 1994, the first channel became a joint stock company, as provided in a Yeltsin decree.
Administratively, ORT remained under state control. The state owns 51 percent of its shares. The remaining 49 percent became the property of financial and industrial structures.
Our correspondent reports that after the 1996 presidential election, small share-holders withdrew from ORT. Now, the channel has only three private share holders. Banks: Stolichny, Menatep, Alfa-Bank and Berezovsky's Obedinenny Bank controls 38 percent of the stakes, the gas monopoly Gazprom controls three percent and Berezovsky's car concern Logovaz owes eight percent. Control over the channel nominally depends on a Supervisory Board chaired by Yeltsin and by a board of directors.
Berezovsky, in a number of conversations with RFE/RL, has said that ORT's strategic goal is the change of the channel's propagandistic priorities. According to Berezovsky, "it is in the state's interests - therefore in the public's too" to instill in the viewers' minds the concepts of market reform, to lobby for the interests of business. In his view, businesses are investing in media branches, not because they have profits as their first goal, but mainly because they aim at securing the very existence and further development of their businesses.
He says that the Communist ideology "has already been defeated, but there isn't yet a stable, big capital." And Berezovsky says that "what happens now in the broadcasting business is similar to what happens in other industrial branches - the strongest players eliminate the weakest ones."
NTV made its appearance in 1993. The creation of an independent channel, pursuing a pro-reform news policy, employing professionals free from ideological constraints and showing quality world productions, pleased many viewers and observers. But our correspondent says that, after last year's election, many observers have grown skeptical about NTV's objectivity. Vladimir Gusinsky, formerly chairman of the MOST financial group, recently withdrew formally from his banking activities to focus on his MOST Media properties.
Besides NTV they include a controlling stake in one of Moscow's most popular and reputed radios "Radio Ekho Moscow," as well as ownership of the daily "Segodnya," of the political magazine "Itogi," and of the entertainment weekly "Seven days." According to our correspondent, Gusinsky, before other businessmen, realized how big could be the political and financial benefits of his media activities, and, therefore, stimulated other private investors to pursue media holdings.
The Moscow English-language weekly "Moscow Times" recently quoted Gusinsky as saying that NTV "turns a profit, albeit a small one," thanks to recent investments, including a satellite cable network, NTV plus, also launched after the 1996 election. Gusinsky said he wishes all the best to new channels, but does "not think they will be successful."
But the new network, TVCenter, will start operating in June with big ambitions. Our correspondent says the channel has already obtained the license to broadcast its programs on the frequency, which up until now, was used by the Moscow city channel. Nationwide broadcasting will take place thanks to state-of-the-art digital technology. Reports say TVCenter already signed agreements with 19 regions to distribute its signal to local stations.
The broadcasting concept of TVCenter takes into account one of the driving ideas of Luzhkov, who promotes Moscow's leading role among Russia's cities. According to this concept, the network must serve as a vehicle for national consolidation and a supporter for patriotism. And -- most important for electoral reasons -- differentiate in the viewers' perception, Moscow and its Mayor, from the Kremlin and Russia's Government, which are widely perceived as corrupt and inefficent.
Moscow City authorities are heavily financing the project, and already own 67 percent of TVCenter's stakes. The remaining 23 percent is expected soon to be put on sale to private investors.
TVCenter plans to have five channels, including two satellite networks. It is expected to employ more than 1,000 people, absorbing the news department of an existing popular local network, "2X2" that is being discontinued.
Our correspondent says Luzhkov's efforts to consolidate his own public platform through the new network appears to originate in the understanding that ORT and NTV, committed to spreading a pro-market message, would be unlikely to support him. And those channel would also be unlikely to help Luzhkov attract part of the leftist and nationalist electorate, disillusioned by Communist leaders, in the next presidential elections, scheduled for the year 2000.
However, Luzhkov's broadcasting ambitions are seen in Moscow as intensifying the existing rift with those viewed as reformers in the Russian Cabinet. Our correspondent says a second Moscow network, the nationalist-leaning "Moskovia" has been granted the right to broadcast three hours per day on TVCenter's frequency. TVCenter's managers have expressed their disappointment at the decision, seen as an attempt to disrupt the image of TVCenter as a "network for all," with the extremist propaganda often carried by "Moskovia."