#1 - JRL 2006-131 - JRL Home
Moscow Times
June 7, 2006
Newspapers Passing Into Hands of Kremlin Allies
By Oksana Yablokova
Staff Writer

State control of print media might be ebbing, as President Vladimir Putin claimed Monday at a World Association of Newspapers conference, but the independent press appears to be losing its independence.

Major dailies are now in the hands of government-friendly financial groups. Many regional newspapers remain partly dependent on local authorities. Gazprom-Media, a branch of the state-controlled gas giant, is expanding its share of the print-media market.

And self-censorship is prompting many editors to focus on crime and human-interest stories and avoid investigative dispatches on, say, elections, opposition movements or the country's relationship with the likes of Iran and Belarus.

While Putin stressed that there were 53,000 periodicals in Russia -- saying it would be impossible to control all of them even if the state wanted to -- he did not mention that most of those publications print stories the Kremlin doesn't care about.

"The vast majority of periodicals the president was referring to are of an entertainment nature and do not need to be controlled by the government," said Igor Yakovenko, head of the Russian Union of Journalists.

"As for the market of high-quality newspapers, the heavy involvement of the government is obvious and makes it an abnormal market where traditional media market economics do not really come into play," Yakovenko said.

The dramatic changes in the newspaper industry, which first flickered to life in the late Soviet period under perestroika, have been building for a few years.

In 2001, Gazprom took control of Segodnya, the flagship paper of Vladimir Gusinsky's Media-Most group. The company soon shuttered the paper, known for its aggressive reporting, and fired the editorial staff of its weekly newsmagazine, Itogi. Gazprom created Gazprom-Media to run its new media assets.

In 2002, Obshchaya Gazeta, a respected liberal newspaper, was quietly closed after founder and editor Yegor Yakovlev sold it to a St. Petersburg magnate who sought to reinvent it under the name Konservator, but failed.

More recently, the prominent papers Moskovskiye Novosti and Noviye Izvestia changed owners and began toeing the Kremlin line or shifting to softer, "infotainment" coverage.

The most striking metamorphosis took place in June 2005, when Gazprom-Media bought Izvestia from Prof-Media, controlled by tycoon Vladimir Potanin.

The new owners of Izvestia, once known for its balanced coverage and good writing, tapped Komsomolskaya Pravda editor Vladimir Mamontov to be the new executive editor in a move that was viewed as politically motivated.

Once the paper of the Soviet intelligentsia, Izvestia under Mamontov gravitated toward splashy, tabloid-style stories that skirted politics. Many editors and reporters fled.

Alexei Simonov, head of the Glasnost Defense Foundation, a group that monitors media freedom, said similar exoduses were likely to hit other papers.

"Media owners find themselves trapped between their journalists, who cannot always be controlled, and the authorities, who can interfere in their business if they are not pleased with the newspaper's line," Simonov said.

Owning a newspaper nowadays means plenty of headaches for investors, Simonov added. It is no surprise, he said, that major media groups like Prof-Media are dumping their newspaper assets.

Prof-Media, which also owns Sovetsky Sport, the tabloid Express Gazeta and a handful of business publications, including Finansovy Direktor and Industriya Reklamy, is negotiating the sale of Komsomolskaya Pravda.

Gazprom-Media is widely seen as the likely buyer of the newspaper. With a circulation of 8.4 million, the paper is the most widely read in the country, according to TNS Gallup Media, a media-tracking agency.

William Dunkerley, an American media and business consultant who was at the WAN conference, called Gazprom's involvement in the media sector harmful.

In a report Dunkerley prepared for the conference, "The Russia Media Market," he noted that media properties acquired by Gazprom tended to lose value.

Media watchers like Andrei Richter, director of the Moscow Media and Law Policy Institute, contend that newspapers' shift away from serious political coverage simply reflects a growing apathy among the general public.

Alexei Pankin, an independent media analyst and former opinion page editor at Izvestia, countered that newspaper owners have a distorted view of readers' tastes.

"I cannot believe that some 650,000 intelligent people, who would want to read a quality newspaper, cannot be found in the whole of Moscow and the Moscow region," Pankin said. He added that a circulation at that level would make the paper profitable.

Pankin and Dunkerley argued that a market for high-caliber newspapers existed. But Pankin said no one was looking to fill that niche.

One of the only remaining independent newspapers providing reliable and in-depth coverage of current events, Kommersant, also looks to be in danger of losing its objectivity (Story, Front page). Nezavisimaya Gazeta, once a prominent independent paper, has changed its tone under new leadership.

Both papers were formerly owned by Boris Berezovsky, the oligarch now living in self-exile in London.

Nezavisimaya Gazeta, which often runs anti-Kremlin stories, was bought in August by Konstantin Remchukov, then-assistant to Economic Development and Trade Minister German Gref.

Officially, the paper was sold to Remchukov's wife because Remchuckov, as a state employee, was barred from buying it himself.

But there has been speculation that Remchukov, a former State Duma deputy elected on a Union of Right Forces ticket and a former vice president of Basic Element, the holding company owned by metals mogul Oleg Deripaska, might have bought the paper for an unidentified third party. Deripaska is friendly with the Kremlin.

Like Nezavisimaya Gazeta under Berezovsky, Gazeta and Vremya Novostei have a reputation for accurate reporting. But they are being poorly managed, Pankin said, selling few ads and barely holding onto their shrinking readership bases.

Gazeta, owned by Vladimir Lisin's Novolipetsk Metallurgical Plant, has a circulation of 72,600. Vremya Novostei is thought to be tied to Alexander Voloshin, the UES board chairman and former presidential chief of staff; the paper prints 51,000 copies daily.

Vedomosti, a daily business paper, also operates independently of any government-friendly organizations. The paper is partly owned by Independent Media Sanoma Magazines, which also owns The Moscow Times.

Other national papers include the weekly Argumenty i Fakti and the daily Trud, both of which are controlled by Promsvyazbank. Promsvyazbank is associated with Sergei Pugachyov, a banker and Federation Council member close to the Kremlin.

While most smaller papers get a lot of their money from regional governments, which are strongly influenced by the Kremlin, several independent media groups continue publishing smaller papers, Simonov, of the Glasnost Defense Foundation, said.

These independent groups include Chelyabinsky Rabochy, AltaPress and Leonid Levin's Yakutia-based media group, he said.

Yevgenia Albats, a journalist at Ekho Moskvy radio who worked for Moskovskiye Novosti in the late 1980s and for Izvestia in the 1990s, compared the current media environment to that of the early 1980s. Contrasting today's more repressive atmosphere with that of the perestroika period, Albats said: "At Moskovsiye Novosti, reporters could write about virtually anything starting in 1989. Now when newspapers report the news, they do it with a great deal of caution, and it is now impossible for reporters to conduct any investigations since there is no access to information of any governmental agencies."