World Media in 2005: Russia

Fourteen years after the collapse of the Soviet Union, Russia has huge economic potential, but the Kremlin keeps a tight grip on the media, who challenge the rich and powerful at their peril.

When the Soviet Union collapsed in 1991, it left Russia vulnerable to continued state control via oligarchs who snapp-ed up energy and media interests. Vladimir Putin was re-elected for his second and final term with a landslide majority in 2004. Political campaigning was minimal: Putin was confident he would be re-elected.

Yet critics argue he was well-served by the media during the campaign period: there were hardly any stories that took Putin to task over his policies. What's more, in his first term, the president pulled the plug on many independent TV broadcasters who happened to be critical of the Kremlin.

This embodies the issue at the heart of Russia's media: just how much editorial independence do media channels have in a country so tightly controlled by the state? According to some sources, the government has the main TV channels, RTR, NTV and Channel One, in the palm of its hand.

What's more, journalists are continually facing threats or even assassination, particularly if they are chasing stories about political corruption. The editor-in-chief of the Russian edition of Forbes magazine, Paul Khlebnikov, was one such casualty, gunned down as he left his office in July last year. Both Forbes and Newsweek launched in Russia in 2004 via partnerships with Axel Springer. Time Out Moscow also launched last year.

State control has a tendency to hamper free market growth, but analysts agree that Russia represents massive economic potential. Goldman Sachs, for instance, highlighted the country as one of the "BRIC" economies (Brazil, Russia, India, China) - which will enjoy such massive growth that between them, in 20 years' time, they will add up to half the size of the G6 economies (the US, the UK, Japan, Germany, France and Italy).

Yet the government seems intent on tightening its grip. One of its latest ways in which it is wielding control is the Beer Limitation Law, which imposes a raft of restrictions on beer advertising. Non-alcoholic drinks and beers make up Russia's single biggest advertising sector, spending $367 million annually, and beer ads alone used to comprise around 10 per cent of all TV advertising.

According to one agency head, beer clients are now desperately seeking agencies that can break through the clutter of the "beer graveyard" instead of spending freely.

ADVERTISING EXPENDITURE

USdollars million at current prices. *Estimated

News- Mag-

Total papers azines TV Radio Cinema Outdoor Internet

1994 700 180 100 300 30 0 90 0

1995 800 220 130 300 40 0 110 0

1996 1,050 280 170 400 60 0 140 0

1997 1,400 350 250 550 70 0 180 0

1998 1,300 350 220 480 80 0 170 0

1999 573 190 70 190 30 0 92 1

2000 826 240 100 270 45 3 165 3

2001 1,336 310 160 510 70 5 275 6

2002 2,010 380 220 900 90 9 400 11

2003 2,630 445 300 1,210 115 12 530 18

2004 3,360 515 360 1,650 135 15 650 35

2005* 4,087 580 430 2,062 157 18 780 60

2006* 4,690 652 500 2,347 176 20 900 95

2007* 5,234 720 560 2,581 199 24 1,010 140

ADSPEND NOTES

1) Includes agency commission

2) Excludes production costs

3) After discounts

FACTFILE

HIGHEST CIRCULATING

Newspaper: Komsomolskaya Pravda (daily, 726,000)

Business magazine: Dengy (weekly, 102,000)

Consumer magazine: 7 Dney (weekly, 1,056,000)

Most-watched TV programme (2003): President Putin's New Year Address

Best new TV format: Dom - "House"(reality)

MAJOR LOCAL MEASUREMENT TOOLS

Circulation: The National Circulation Service

Readership: TNS Gallup Media

TV: viewing TNS

TOP MEDIA OWNERS

Newspapers: Komsomolskaya Pravda

Magazines: Independent Media

Television: Pervy Kanal (public), VGTRK

Radio: Russian Media Group

LOWDOWN

Media topic du jour - Restrictions to beer ads.

Reigning media guru and why - Yuri Zapol, the president of the Video International (VI) Group - because VI controls 70 per cent of the TV market.

Media mogul to be seen dining with and why - Konstantin Ernst, the general director of the leading Russian TV network First Channel. He is influential in the Russian media market and produces various music and TV projects.

Car to drive - Any big model, such as a Range Rover or a Hummer.

Top-selling beer brand - Baltika.

Phone to carry - Motorola is the best-selling brand.

Whatever you do, don't say ... "Let's discuss the elections in Ukraine."

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