Macedonia: Press Takeover Concerns

There’s concern the WAZ media acquisitions will create a monopoly in weak media market.

Macedonia: Press Takeover Concerns

There’s concern the WAZ media acquisitions will create a monopoly in weak media market.

Tuesday, 6 September, 2005

Macedonian journalists have welcomed the takeover of three major newspapers by the German media giant WAZ, saying it will give them greater political independence - but some media analysts warn that the move could lead to a monopoly.

On July 28, the Essen-based WAZ group bought controlling shares in Dnevnik, Vest and Utrinski Vestnik, the three dailies with the highest circulation - jointly estimated at 120,000.

The three titles will be managed and distributed by a new umbrella company called Media Print Macedonia, as a way of reducing overheads. The firm is to be headed by Srdjan Kerim, a former Macedonia foreign minister who was special adviser to the ex-head of the European Union’s Balkans Stability Pact, Bodo Hombach, now a WAZ director.

Although details of the deal were not disclosed, IWPR has learned that the Germans acquired an 81.9 per cent stake in Dnevnik and 51 per cent in the other two papers.

WAZ has pledged not to interfere in editorial policy. Hombach recently told Deutsche Welle radio, "We are the better alternative for journalists who want to work free of manipulation and influences.… We have strong partners in Macedonia, and we will leave the editors to do their job."

Editors and shareholders see the takeover as a positive step that will raise professional standards and strengthen the media’s independence from political pressure.

Dnevnik, centrist and nationalist in outlook, dominates the print scene. It has maintained its role as a leading independent news outlet since it was founded in 1996. At the time, it was the only opposition to the state-owned media.

Its chief editor, Branko Geroski, says the WAZ deal is good for his paper. "We were making a profit and we had a high circulation, but we had to think about the big picture,” he told IWPR. “We realised WAZ was a serious strategic partner and we simply could not say no – we had to think how we could develop further.”

He thinks the profit motive will guarantee editorial freedom, "You have to work profitably in order to maintain your independence because when you are struggling for survival you are vulnerable to political pressure."

Goran Mihajlovski, editor in chief of the tabloid Vest, said German investment would bring higher quality and lower costs, making the papers more competitive. "Now we can focus more on the content, we don’t have to worry about ads," he said.

Diplomats are cautiously optimistic that WAZ will help the media become free of political interference.

"What the Macedonian press badly needs is independent and unbiased media where journalists report objectively, instead of spreading confusion and insecurity by reporting rumours,” said a western diplomat who asked not to be named. “Very often we see journalists here taking up the role of politicians."

The Macedonian media are vulnerable to pressure from politicians, and most outlets have historically had political affiliations. Successive governments have been able to exert considerable influence by pressuring commercial advertisers – the media’s major source of income.

Journalists working on the three dailies were reluctant to comment on the deal. So far no job cuts have been announced as a way of trimming costs.

Others in the Macedonian media are worried that the German takeover will skew the small market for newspapers, making it less rather than more competitive. They fear that WAZ will simply squeeze out weaker titles by attracting advertising with cheaper rates, and printing and distributing editions for less money.

“It will no doubt increase both journalistic standards and the media’s professional abilities,” said Ljupco Zikov, owner of the economic weekly Kapital. “However, there is a problem with a monopoly situation on the publishing market, given that WAZ will hold over 80 per cent of it.”

Aco Kabramov, editor in chief of A1 Television, fears that editorial standards will ultimately suffer, "I think that this deal will have a negative affect on the media scene as it will impose an monopoly. No matter how independent the editorial policy seems, it will not contribute to professionalism or pluralism... The three newspapers will be under the same company and that will ultimately lead to a more or less unified editorial policy."

This IWPR reporter approached WAZ lawyers in Skopje on several occasions for comment on the aforementioned concerns, but was told that company representatives were not available for interview.

The government’s anti-monopoly committee has yet to issue a view on whether WAZ’s acquisitions are in line with ownership regulations.

Elsewhere in the Balkans, the effect of WAZ’s massive investments, some say, has distorted already weak commercial markets.

In Bulgaria and Croatia, the group has effectively gained control over large swathes of the print media. Last year, it moved into Serbia, taking a 50 per cent share in the dominant publishing house that owns the leading daily Politika.

At present, there is no big player in Macedonia’s media, since the once-powerful publishing house Nova Makedonija - a state-owned monopoly for nearly 60 years, with several dailies and many periodicals - has lost much of its influence.

The country’s leading dailies Nova Makedonija and Vecer are now marginalised, with huge debts and circulation falling to below 1,000. The country currently has a total of eight dailies, six in Macedonian and two in Albanian.

Klime Babunski of the Institute for Sociological, Political and Legal Research believes WAZ may go on to make further acquisitions. "This will not be the end of it,” he said. “I don’t see why WAZ shouldn’t expand into the weekly market. They have the resources for it, and the interest.”

Ana Petruseva is IWPR's coordinating editor in Skopje.

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