Media funding and ownership transparency issues discussed at public forum

The Georgian media is experiencing legal, political and economic problems, including issues related with transparency of media ownership and property rights, a report drawn up in the frames of a joint project Public Forum and Dialogue of the USAID Georgia, the Georgian Institute of Public Affairs and the Policy Management and Consulting Group says. According to the author of the review, Editor-in-Chief of Rezonansi newspaper Lasha Tughushi, one of the major problems of the Georgian media outlets in terms of financial transparency is related to licensing.

“When licenses are granted to broadcasters, applying legal entities are not required to submit financial documents, while individuals need to present title ownership declarations on their property,” the report reads “public funds are clearly voluntarily channeled to media. Decisions tend to be vague. Formal basis of such decisions is unclear as the public agencies as a rule do not respond or give negative answers to questions on public disclosure of information,” it continues.

During his presentation, Tughushi focused on the issue of “monopolized commercials”, saying that a legal successor of Media House LTD and Touch Media LTD – is the general Media, which according to Tughushi, is becoming the owner of 95 percent of domestic market share. “Merger of these two companies will lead to the restricted competition,” Tughushi said. He noted that during the 8 months period of year 2010 pro-governmental nationwide TV channels had monopolised commercials market with Imedi TV getting GEL 27.7 million from commercials, Rustavi 2 – GEL 21.7 million, Public Broadcaster – Gel 7.95 million, Mze TV – GEL 3.11 million, Kavkasia 1.06 million and Maestro – 0.72 million.

Tughushi suggested that Public Broadcaster’s right to place commercials on its air in the conditions of a limited market “hampers the establishment of competitive media environment.” “Over 8 months of 2010 the Public Broadcaster generated about 5 times higher revenues from placement of commercials than Kavkasia and Masetro altogether,” he said. Tughushi noted it is necessary to ensure a competitive market for TV commercials, to facilitate the transparency of media environment through setting financial, property transparency rules for media operation, to restrict public funds inflow to media and to build a new legal and legislative base for media.

Analyst at the Economic Policy Research Center, journalist Revaz Sakevarishvili said the issues raised by Tughushi are justified, however he said the media outlets themselves should be more active in terms of using new media tools to enhance their financial conditions. “They should seek external means of funding in order to reach financial independence,” Sakevarishvili noted.