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Ukraine - Footprint of Financial Crisis in the Media (2009)

Ukraine - Footprint of Financial Crisis in the Media (2009)

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Published by OSFJournalism
This Open Society Institute Media Program study explores the impact of the financial crisis on media and news delivery to citizens in 18 countries of Central and Eastern Europe and the Commonwealth of Independent States.

The global economic downturn has affected countless businesses across the region, forcing them to slash costs, lay off employees, and reduce output. Media businesses are no exception. However, when media businesses are hit, it is not just their turnover that suffers: their primary function, the delivery of news to citizens, feels the impact too.

To explore the impact of the crisis on independent media and accountability journalism, the Media Program carried out a study in 18 post-socialist countries heavily hit by the crisis: Albania, Armenia, Bosnia and Herzegovina, Bulgaria, Czech Republic, Estonia, Hungary, Kyrgyzstan, Latvia, Lithuania, Macedonia, Moldova, Montenegro, Poland, Romania, Serbia, Slovakia, and Ukraine.

The study looks at media performance in 2009 compared with the previous three years, explores the cost-saving measures taken by significant news carriers, and the effects of these measures on output, breadth and depth of coverage, scope of investigative reporting, and opportunities for open public debate.

Key Findings
Media across the region have lost 30 to 60 percent of their income.
Media were forced to adopt cost-saving measures, including reduced volume, staff layoffs, reduced investigative reporting, and cuts in international and provincial coverage.
Several media markets have experienced a flight of foreign investors and bankruptcies of independent outlets.
The crisis-related constraints and ownership changes have caused an overall drop in the quality of news delivery to citizens.
Media content has become shallower, more entertainment-centered, increasingly isolationist, more prone to political and business influences, and lacking in investigative bite.
This Open Society Institute Media Program study explores the impact of the financial crisis on media and news delivery to citizens in 18 countries of Central and Eastern Europe and the Commonwealth of Independent States.

The global economic downturn has affected countless businesses across the region, forcing them to slash costs, lay off employees, and reduce output. Media businesses are no exception. However, when media businesses are hit, it is not just their turnover that suffers: their primary function, the delivery of news to citizens, feels the impact too.

To explore the impact of the crisis on independent media and accountability journalism, the Media Program carried out a study in 18 post-socialist countries heavily hit by the crisis: Albania, Armenia, Bosnia and Herzegovina, Bulgaria, Czech Republic, Estonia, Hungary, Kyrgyzstan, Latvia, Lithuania, Macedonia, Moldova, Montenegro, Poland, Romania, Serbia, Slovakia, and Ukraine.

The study looks at media performance in 2009 compared with the previous three years, explores the cost-saving measures taken by significant news carriers, and the effects of these measures on output, breadth and depth of coverage, scope of investigative reporting, and opportunities for open public debate.

Key Findings
Media across the region have lost 30 to 60 percent of their income.
Media were forced to adopt cost-saving measures, including reduced volume, staff layoffs, reduced investigative reporting, and cuts in international and provincial coverage.
Several media markets have experienced a flight of foreign investors and bankruptcies of independent outlets.
The crisis-related constraints and ownership changes have caused an overall drop in the quality of news delivery to citizens.
Media content has become shallower, more entertainment-centered, increasingly isolationist, more prone to political and business influences, and lacking in investigative bite.

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Categories:Types, Research
Published by: OSFJournalism on Jul 25, 2012
Copyright:Attribution Non-commercial

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FOOTPRINT OF FINANCIAL CRISIS IN THE MEDIA1
Footprint of Financial Crisis in the Media
Ukraine country reportCompiled by Irina ChebotayevaCommissioned by Open Society InstituteDecember 2009
 
FOOTPRINT OF FINANCIAL CRISIS IN THE MEDIA2
Introduction
The global financial crisis, which hit the Ukrainian economy in the second half of 2008, led to a 13 percent decrease in GDP in 2009 on the previous year and a drastic fall in the value of the Ukrainiancurrency against the US dollar, as well as a decline in the average wage and purchasing power.Statistics do not show growing unemployment, but official figures in this field are generally consideredto be unreliable because they do not include the high level of unregistered unemployment.On the other hand, there is a steady increase in media hardware. People continue to buy new TVsets and satellites or sign up for cable television. Internet use has more than doubled since 2006, andthere has been an increase in the number of mobile phones and the availability of broadband.However, the expansion of technical provision does not mean that the media market in Ukraine hasavoided the crisis or that this has not influenced the quality of information on social and politicalmatters produced by the mass media. In 2009, advertising revenues significantly decreased for theprint media and radio markets, while the TV market experienced an insignificant increase; the onlyreal growth was in the internet market.We collected and analysed ten in-depth interviews with media consumers, academics, bloggers and journalists, mostly young and middle-class, to get their assessment of how the crisis had affected thecontent of media output in Ukraine. This is reflected in what follows.
General state of the media market
The majority of respondents suggest the crisis has strengthened the trend towards monopolisationand concentration of ownership. During the run-up to the presidential election in January 2010broadcasting licenses were particularly valued, they say, so where a TV or radio station becamebankrupt, instead of closing down it found itself with a new owner. A rise in the price of newsprint asa result of the crisis caused the closure of certain small periodicals but this did not influence themarket situation significantly.Official statistics show there was a fall of more than 200 in the number of newspapers from 2007 to2008. In 2009 even major newspapers encountered financial problems. According to informationfrom the prominent dailies
Gazeta Po-Kiyevski 
and
Segodnya 
, they experienced significant losses incirculation, advertising revenues and editorial staff. It is expected there will have been comparablelosses also among the regional press because of the poor development of their advertising markets.
 
FOOTPRINT OF FINANCIAL CRISIS IN THE MEDIA3
In general respondents consider the structure of the Ukrainian mass media market to be determinedby political rather than commercial competition; media organisations are not primarily seen as abusiness but as a tool to manipulate public opinion. Usually the mass media are dependent on theirowners both financially and in terms of editorial policy, and their lack of independence is due mainlyto the political engagement of their owners, not government pressure. According to respondents theresults are increasing corruption and disinformation; freedom of speech exists chiefly in the form ofrhetoric, while the way power and money are distributed among groups that are competing politicallyand commercially is not publicly visible.
Media content
Respondents feel consumers get a highly distorted image of reality from the Ukrainian mass media.They observe that there is plenty of information but that it is vague and unreliable, that coverage ofevents is superficial and that political analysis is non-existent, even at the most elementary level. Theimpact of the crisis on costs has inevitably made this situation worse. Most respondents said themedia, and especially the press, have stopped producing their own content and now merely recyclematerial from agencies or even unchecked facts from the internet. Coverage of social and politicalevents concentrates on electoral considerations, meaning in effect campaigning for or againstparticular candidates; otherwise current affairs, legislative issues and so on are not reported in aserious way but presented as “infotainment”.In the view of respondents, the crisis itself receives extensive coverage, though this focuses onunemployment, the Ukrainian currency rate and bad loans, while policies to combat the crisis policiesare given much less attention. For example, there has been little explanation of the reasons for risinginflation and falling living standards.Respondents also say the crisis has almost completely extinguished investigative journalism, which iscostly and time-consuming, requires a high level of professional skill and potentially poses dangers toa journalist’s career or even life. Topics like corruption are not investigated or reported in a direct way.Human rights problems are regarded by the media as “exotic” and not really within the audience’sunderstanding. Culture other than show-business is scantily covered and social issues usually inrelation only to electoral campaigns. Consumers find much coverage to be circular – the media andpoliticians constantly quoting each other.
Media ownership and editorial independence

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