Media Capture in Russia: An Expensive Venture. A Financial Analysis of Key Russian Media Companies
London: Media and Journalism Research Center (MJRC) (2023), 26 pp.
"Russia’s three media giants, Gazprom Media Holding, National Media Group, and VGTRK, are interconnected through an ownership structure where the state remains the primary beneficiary. Shareholding links and the Kremlin’s personal ties demonstrate how the Russian media landscape is captured through a closed and tightly controlled structure characterized by nepotism, cronyism, and corruption. The primary media assets of the three holdings and the state are television channels, including Channel One, Russia-1, Russia-24, Russia-K, Carousel, NTV, Match TV, TNT, TV-3, Friday!, REN TV, STS, and Domashniy. These channels are the most popular sources of media content for most Russians. Unfortunately, there are no politically independent television channels remaining in Russia. The major media companies are continuously losing money due to the stagnating advertising market and the withdrawal of western capital. Meanwhile, the government is providing support to the media by giving away billions of rubles. The state budget indicates that media sponsorship is increasing, with wartime as an incentive for more funding.
The channels receive generous subsidies, but with all the state money comes the Kremlin's order to produce more propaganda. The channels obediently follow this order, which results in an increase in political programs and a decrease in entertainment. As a result, there are emerging indications that the Russian population may be getting tired of wartime television. Billions of rubles from the state budget will continue to be allocated towards propaganda television, but this will come at the expense of other state-funded sectors. Will the government be willing to cut social support programs in the near future to be able to fund media instead? Only time will tell. However, one thing is abundantly clear: those in control of the three holdings analyzed in this report (and Channel One, minority owned by one of the three) have been unable to guide the companies towards steady growth, even prior to the full-scale invasion of Ukraine." (Conclusions, page 26)
The channels receive generous subsidies, but with all the state money comes the Kremlin's order to produce more propaganda. The channels obediently follow this order, which results in an increase in political programs and a decrease in entertainment. As a result, there are emerging indications that the Russian population may be getting tired of wartime television. Billions of rubles from the state budget will continue to be allocated towards propaganda television, but this will come at the expense of other state-funded sectors. Will the government be willing to cut social support programs in the near future to be able to fund media instead? Only time will tell. However, one thing is abundantly clear: those in control of the three holdings analyzed in this report (and Channel One, minority owned by one of the three) have been unable to guide the companies towards steady growth, even prior to the full-scale invasion of Ukraine." (Conclusions, page 26)
