Big Media Companies Reach Into Smallest Countries

Michael Hedges May 27, 2007

Conventional wisdom holds that big media companies are interested only in media deals in the biggest markets. Merger and acquisition lawyers and advisors say the paperwork, big deal or small, is the same. But there is no surprise at News Corps recently acquiring two television companies in Latvia, one of Europe’s newest and smallest countries with a hot media market.

News Corp Europe, principally owned by Rupert Murdoch, purchased Latvijas Neatkariga Televizija (LNT) entirely and 70% of the Riga-based TV 5 network. Financial details were not disclosed. Transparency International Latvia’s Executive Chairperson Roberts Putnis wrotein 2006 that Russian billionaire Boris Berezovskiv’s “direct influence” at LNT and TV5 was an “open secret” in Latvia. In 1999 Murdoch and Berezovskiv jointly launched Nashe Radio in Moscow.

Latvian broadcasters are reveling in what one station director called “the best year ever” for ad sales. 2006 ad market figures released by TNS Latvia showed €108.2 million.

LNT is the top rated free-to-air TV in Latvia, followed closely by Modern Times Group (MTG) owned TV3. TV5 has but a tiny audience share.

News Corp is creating significant broadcast outposts in New Europe…and beyond. The Latvian stations position the company within the “Baltic Tigers.” Earlier deals in Bulgaria, Romania and Serbia position the company in the “Balkan Tigers.”  Fox Turkey (formerly TGRT) covers the “Turkish Tiger.” And, of course, deals in Russia position Mr. Murdoch along side the “Russian Bear.”