Former workers feel chill in Russian TV venture

By Sophia Kishkovsky International Herald Tribune

SUNDAY, JANUARY 1, 2006

MOSCOW Turnover in the news department of REN TV, Russia's last nationwide television network with independent news programming, has raised questions among analysts and media watchers about Kremlin influence in the channel's sale and the role of RTL Group, the broadcasting arm of the German media conglomerate Bertelsmann.

 

In July RTL Group bought a 30 percent stake in REN TV, one of the top Russian networks, from Irena Lesnevskaya, who founded and ran the channel with her son, Dmitry Lesnevsky.

 

REN TV, whose signal reaches more than 113 million people although its audience share hovers around only 5 percent, was distinguished by critical news reporting that offered an alternative to state channels' uniformly positive coverage of President Vladimir Putin, said media analysts, free speech advocates and some politicians.

 

"REN TV was the last channel that had real news, people who tried to speak the truth," Aleksei Simonov, president of the Glasnost Defense Foundation, a press freedom group, told Ekho Moskvy radio station in October after the stake sale.

 

On Nov. 24, private security guards blocked Olga Romanova, the sharp-tongued host of a news analysis program called "24," from entering the studio at the network's Moscow headquarters, according to Romanova. She said they were acting was on the orders of Alexander Ordzhonikidze, a former natural gas industry and satellite television executive who was appointed by the new shareholders as chief executive of REN TV Media Holding, parent company of the television channel.

 

Ordzhonikidze told Russian media that he was trying out new anchorpersons for the program and that security in the studios was tight.

 

Ralph Siebenaler, an RTL executive who has helped develop the company's stations in Central and Eastern Europe and was appointed chief executive of REN TV, did not intervene, Romanova said.

 

"When you have a change of management in a company, it happens unfortunately that parts of the former management team do not get along with the new team," Siebenaler said in an e-mail message. "As news does not lie in my sphere of responsibilities in the channel, I do not want to openly comment about the acts and deeds of the people involved."

 

Andrew Buckhurst, a senior vice president at RTL's headquarters in Luxembourg, said in an e-mail response to questions that "we are not aware of any political interference in the policies or decisions of the station. If we were, we would obviously be concerned."

 

Buckhurst added: "While we are a minority shareholder with just 30 percent, we are clearly the shareholder with experience in the TV world, but it should be noted that we cannot be held responsible for ensuring or guaranteeing press freedom from this minority position. All three shareholders share the same view that REN must continue with its editorial line, offering a full service to its audience, including news."

 

RTL shares ownership of the station with a Russian steel maker and a Russian oil company, whose chief executives both campaigned for Putin during the 2004 presidential race.

 

RTL's investment in REN TV is in part indicative of Russia's booming television advertising market. Renaissance Capital, a Moscow investment bank, recently reported that the television ad market was expected to have grown by 36.5 percent, to $2 billion, in 2005.

 

Unified Energy System, the electricity monopoly that has as its chairman Anatoli Chubais, the politician who has advocated economic policy that would reduce state control of companies, sold its 70 percent stake in REN TV in July to a subsidiary of Severstal, one of Russia's biggest steel makers, for $100 million. Severstal is led by the 40-year-old billionaire Alexei Mordashov. Mordashov turned around and sold 35 percent of REN TV to Surgutneftegaz, the large Russian oil company, which has as its chairman Vladimir Bogdanov, a reclusive Siberian billionaire.

 

Romanova said that, in the weeks leading up to her removal as anchorwoman, she had protested what she said were Ordzhonikidze's decisions to keep several reports off the air, pressure that began after she ran a report about a pro-fascist march in Moscow on Nov. 4. The reports included one about elections in Kazakhstan and another about prosecutors' dropping charges against Defense Minister Sergei Ivanov's son, who was accused of killing a pedestrian with his car, Romanova said.

 

In another example of what she called censorship, Romanova said that a report about a soccer team comprising homeless men from St. Petersburg traveling to Ireland to defend the team's title in the world homeless soccer championship was pulled by the new management.

 

"It was removed with the words: 'There are no homeless people in St. Petersburg. St. Petersburg is rich, it is the city of the president,"' she said.

 

Ordzhonikidze told the Interfax news agency that "I didn't give anyone any orders to remove any reports."

 

Romanova said she thought executives were acting out of a desire to please the authorities, not on direct orders from the Kremlin. In what she described as a fig leaf to cover her removal from the air, she was told she must develop a concept for a new program.

 

"For two days I sat and was silent, and then I quit," she said. Several news editors and staff followed, she said, and the liberal media - several newspapers, Web publications and the Ekho Moskvy radio station - declared that independent television news was dead.

 

Romanova and the colleagues who followed her in leaving the station said that REN TV's German investors have been a particular disappointment, saying they had expected the outsiders would be protectors of freedom of the press.

 

"I think that RTL in this situation behaved even worse than Russian shareholders because they represent an international concern," said Yelena Fyodorova, REN TV's former news editor. She said she had resigned because of the new atmosphere at the station.

 

Ordzhonikidze told Kommersant, a daily business newspaper, that his decision to take Romanova off the air was not political but reflected dissatisfaction with her ratings. Speaking of "24," he said, "This program should have a higher-than-average rating."

 

In other interviews, he said that Romanova had been warned she would not be on the air Nov. 24. He was not available for interviews for this article.

 

Some journalists and analysts say they believe that Unified Energy System sold a part of its stake in REN TV under Kremlin pressure, and they also speculate that Severstal bought it at the Kremlin's request to clear the airwaves of critical coverage of Putin and the government before the parliamentary and presidential elections scheduled for 2007 and 2008. Chubais has said that the company was selling noncore assets.

 

"I think it was constructed in such a way so that respectable but also loyal owners would appear who deal exclusively in business," said Anna Kachkayeva, a media analyst with Radio Liberty in Moscow.

 

Kachkayeva also said that the Lesnevskys received a market price for the channel rather than having it confiscated, in what she called a good sign.

 

"Of late, there's been an obvious tendency in Russia," Kachkayeva said. "You can be in the media business if you don't have news or political programming. No one interferes with getting rich and growing, and even German investors are allowed."

 

News Corp. tried for a stake in REN TV during the string of sales this summer. Romanova said Lesnevskaya was turned off by the sensationalism of Rupert Murdoch-owned news broadcasters, especially Fox News in the United States. A spokeswoman for Lesnevskaya said that she was refraining from talking to the news media for now.

 

Kachkayeva predicted that News Corp., which has become a huge player in Russia's outdoor advertising market, would still make a splash in Russian TV. In December, Channel One, the largest national channel, began 24-hour satellite broadcasting in the United States through Murdoch's DirecTV.

 

At a meeting of foreign business executives with Putin in St. Petersburg last June, Murdoch asked when the taboo on foreign investment in Russia's top television networks would be lifted.

 

January could be a pivotal month for the industry: The government is scheduled to auction 40 regional channels. Kachkayeva noted that Severstal recently bought a stake in Channel 5. And Siebenaler said that REN TV would participate in the tender and would like to create a sister channel.