Rumena Filipova (DPhil Candidate, St Cross College, Oxford)
On 7 May 2015, Dr Veselin Vackov (Managing Editor of prominent daily Czech newspaper Lidove Noviny) addressed the phenomenon of foreign ownership of the press in Central and Eastern Europe (CEE) at a lunchtime seminar organised jointly by South East European Studies at Oxford (SEESOX), Programme on Modern Poland (POMP), and the Bulgarian, Czech, and Slovak Oxford University Societies.
Dr Vackov posited that soon after the political and economic changes of 1989, Western investors entered Central and East European press markets with purely economic goals and motivations, which remained largely fulfilled by 2006/2007. It was around this time that Western investors began to exit CEE markets as more profitable economic opportunities emerged elsewhere (like in Africa) and the 2008 Financial Crisis simultaneously imposed revenue constraints. The period of predominant foreign ownership of the press until this point left two important legacies and unresolved problems. First, the CEE public expressed its grievances concerning the commercialisation and tabloidisation of the press; there is a lingering sentiment that foreign owners had failed to fulfil CEE audiences’ cultural expectations of quality journalism. Second, the departure of Western investors has endowed CEE press markets with significant uncertainty as to the most sustainable business model, which must now be formulated by local investors in the market. Furthermore, the public has expressed doubts over the commitment of local investors to political neutrality.
After presenting the main argument of his talk, Dr Vackov expounded on the historical context of Western investment in CEE markets, providing a more nuanced analysis of country-specific differences within the overall trend. The speaker noted that the pace and scope of the ‘Westernisation’ of press ownership depended on the more general political and economic environment in a given CEE country, particularly in the 1990s. For instance, Hungary and the Czech Republic introduced the most liberal media legislation early in the 1990s, which was followed by rapidly expanding Western investment in their press markets. In other countries, such as Poland, there were restrictions on foreign ownership, which meant that Western and local publishers enjoyed similar stakes in the press market. In other CEE countries, such as Bulgaria, Romania and Slovakia, a period of rapid privatisation of print media by Western investors took place later, in the mid to late 1990s, due to political instability.
Although throughout CEE there were important gains from foreign ownership of the press (including the infusion of much needed capital and investment into the establishment of printing houses; the introduction of new Internet operations; and knowledge transfer in areas of regional journalism, press distribution, marketing, and advertising), the common critique of the concomitant commercialisation and tabloidisation of the press did not manifest itself in all CEE countries. Dr Vackov proposed three factors that account for these divergent outcomes. First, the processes of commercialisation and tabloidisation are global phenomena – not just direct by-products of foreign ownership. Second, tabloidisation has taken different forms and scales depending on the economic conditions and market size of a given CEE country. For example, the larger and more affluent Czech and Polish markets (in contrast to their Bulgarian and Slovak counterparts) ensured that serious newspapers managed to secure a significant share of the print media. Third, the speaker maintained that the commitment of foreign investors to high quality journalism weakened with the 2008 Financial Crisis; Western publishers were responsible owners in times of plenty but were prepared to decrease the quality of the press in times of scarcity. A related point is that Western publishers entered CEE markets for primarily economic (as opposed to cultural or political) reasons.
After elaborating on the nuances of the reception and outcome of Western investment in the press markets of different CEE countries, Dr Vackov focused on two important, interrelated challenges that print media face following the mass departure of foreign owners since 2006. In particular, the speaker argued that ‘concentration’ is the most important consequence of the period of predominant foreign ownership: powerful external publishing houses prevented strong local ones from emerging, ensuring that new local entrants into the print press market have significant non-media interests. This phenomenon, in turn, poses the question as to whether local investors will be able to uphold political neutrality, given the diversity of their business activities and inability to maintain financial sustainability by focusing solely on their media businesses. Dr Vackov believes that the answer is currently impossible to predict, venturing that one probable scenario invokes the ‘free market’ argument. Thus, adjustment towards neutrality might occur because biased reporting will damage business interests due to reader dissatisfaction and hence reduction in demand.
Overall, Dr Vackov presented an extremely illuminating account of the significant changes taking place in the press markets of Central and East European countries, including the shift from foreign to local ownership; the legacies left by Western investors; and the challenges yet to be confronted. Although this relays a situation of flux, the speaker expressed one important certainty – print press is not moribund due to technological change. Print press lives on, especially in CEE, due to the populations’ traditional loyalties to the medium. Coupled with the process of aging, these factors provide print press a lifeline of a number of years to adapt to technological changes.