Berlusconi’s Disregard of the Italian TV Election Laws Nearly Won Him A Major Upset When He Should Have Lost Big, But Post Election He Got The Good News The Anti Trust Authority Cleared The €200 Million In State Subsidies For DTT Desktop Boxes, Distributed By His Brother, Necessary For His Mediaset Empire To Get Digital Broadcasts Going

As prime minister, also the richest man in the country, and having a controlling interest in the country’s largest media concern and great influence over the state broadcaster, such an individual knows almost instinctively the power of the media and how to use it to the best advantage. It certainly doesn’t hurt either to have the money to make things happen.

The all-important bottom line, of course, is that Berlusconi still lost, but he started electioneering when he was eight points behind Romano Prodi, and he lost just by just 24,000 votes. Indeed it is very possible that Italians living in the US and the large Italian community in Argentina may have swung the election with their foreign votes – and Berlusconi couldn’t get to those folks with his domestic electioneering although representatives had been sent abroad to campaign on his behalf.

Contrary to what some Italian analysts have written that the loss proves that television is not the deciding factor in an election, Berlusconi’s tactics really show just how powerful television and getting your name in print really is. When he started electioneering he was some 8 points behind Prodi and he almost pulled off the upset of the century.

Berlusconi understood that the election was about him. The opposition was more criticizing what he had done rather than what they would do. So he decided it was in his best interest to get his name in large headlines every day – it didn’t matter whether they were positive or negative – and to get his face on television as much as possible. He was well behind in the polls and he wanted voters to read and see what he had to say – there was still a 25% undecided vote out there.

ftm background

What Is So Delicious About What Silvio Berlusconi Does Is That He Is So Blatant, So “In Your Face.” He Knows It. The Italians Know It. And He Gets Away With It.
If you’re prime minister of Italy facing a general election in April, and you’re behind in the polls you’d want to get as much positive television exposure as possible in the weeks leading up to the election. Right? Especially if you control one way or the other some 90% of Italian television! But you know that once Parliament is dissolved there are very tough rules in Italy equalizing television exposure time for candidates, and banning political adverts. So what do you do?

“One way to judge which way the (Italian political) wind is blowing is to keep a close eye on the RAI privatization.” ftm, Jan.1, 2005; RAI Privatization Dead - Oct. 27, 2005
The more Italian Prime Minister Silvio Berlusconi’s center-right coalition dropped in the opinion polls for next April’s election, and the more Romano Prodi’s center-left coalition gathered popularity, the more the privatization of state broadcaster RAI was in doubt. Now it is dead.

Italian Football Score: Berlusconi 1 Murdoch 0
The world’s first pay-per-football-match digital terrestrial television system, owned by Italy’s billionaire Prime Minister Silvio Berlusconi, has gotten off to a rousing start, and that’s bad news for Rupert Murdoch’s Sky Italia satellite service.

Berlusconi Family Adds Radio to Media Holding
Arnaldo Mondadori Editore finalized its purchase of all or parts of three Italian radio channels through its new subsidiary Monradio.

Television, Italian Style: Rupert Murdoch Learns That Prime Minister Berlusconi Is a Worthy Opponent
The Italian television business is stranger than fiction

Even opposition newspapers ran continual critical daily banner headlines saying Berlusconi this, and Berlusconi that. He didn’t care much what they said. The fact his name was there in big print was what counted.

And then there was his (ab)use of television. To say the least it was truly masterful. For three weeks before the election campaign was to have officially began there wasn’t a day that he wasn’t appearing on some television program. It didn’t have to be about politics – his AC Milan football club was as good a topic as any – but it got his face in front of the viewers.

That went so well in fact that Berlusconi then pressured President Carlo Azeglio Ciampi to postpone the dissolution of Parliament for two weeks, and thus the official start of the election period, giving Berlusconi two weeks more of not having to worry about strict law governing television coverage of candidates during the official campaign.

One estimate said that in two weeks Berlusconi had more than three hours of airtime compared to Prodi, who had eight minutes. He had continued his appearances through a Friday night television talk show and then on the Saturday Parliament was dissolved and the official campaign began.

As a businessman his family has a controlling interest in the Mediaset broadcasting empire. As prime minister he had great control over RAI, the public TV broadcaster. Put the two together and he had a large influence over some 90% of the Italian TV airwaves. And with that control it seems the supposedly strict TV equal access election laws somehow just didn’t work too well.

RAI admits that from February 11 to March 23 – the period some two weeks before the election -- Berlusconi’s coalition received about 60% of the coverage compared to challenger Romano Prodi’s 40%, and those types of percentages were thought to have continued through to election day.

And on Mediaset channel Rete4, in a similar period Berlusconi got about 80% of the coverage compared to the Prodi coalition’s 20%. Other Mediaset channels were flagrant, too, in promoting their owner. There were fines from the Authority for Communications, but those fines were not about to worry the country’s richest businessman, and the stations continued their heavy Berlusconi coverage.

But, yes, he did lose, by the smallest of margins, but in opposition he has said he will bring down the Prodi government as quickly as possible. At first Prodi was somewhat conciliatory, trying to gain Berlsuconi’s support by saying that he had more important things to do than concentrate on breaking up Mediaset. Prodi had said, however, he thought regulations were necessary to regulate conflicts of interest when a media magnate also is a politician.

And in his first Parliamentary speech last week Prodi said his government would pass such a conflict of interest bill. In a carrot and stick approach to Berlusconi who has been known to bypass government regulations he said, “We need rules, but also regulators.” But he also said he was not looking to punish the guilty, rather just to ensure regulations are followed.

But even with Berlusconi out of government the shenanigans still continue. Last week the competition authority ruled that the €200 million that Berlusconi’s government spent on subsidizing digital set-top boxes, distributed by his brother Paolo, and necessary for viewers wanting to watch Mediaset’s digital broadcasts, was not against competition rules.

Sky Italia had complained about the subsidies. Sky has an expensive contract that allows it to televise via satellite the Italian A League. Mediaset signed a far less expensive contract with the league to show on an individual match basis on the digital platform league games. But to watch on the digital platform the user needed expensive set-top boxes and Italians weren’t buying them in the numbers to make digital a going concern.

Berlusconi’s government had stepped in early when MediaSet was launching its DTT platform with more than €200 million worth of subsidies that paid at least 50%, sometimes more, of the cost of the digital box. And that spurred sales. Sky complained the boxes could be used only for the digital terrestrial television (DTT) format and not for cable reception.

The competition authority said that any DTT vendor and not just Mediaset could use the boxes and therefore the subsidies were okay. Sky was not eligible for desktop box subsidies because its decoding technology was proprietary. Sky has made a similar objection to European officials.

Sky had feared that it would lose subscribers to its expensive monthly sports subscription packages to Mediaset’s policy of charging per individual game, but recent results show that Sky Italia’s business has thrived in the past 12 months. It added 472,000 subscribers and now has an operating profit of €55 million, a swing of some €70 milling from the year before. It reported a total subscriber count of 3.71 million at the end of March, an increase of 110,000 for the quarter.

But a new scandal has broken out that could really hurt both Sky Italia and Mediaset. Authorities are investigating match-fixing and illegal betting during the 2004-2005 football season and the entire board of directors of league champion Juventus has resigned. Prodi, fully understanding how football goes to the heart of most Italians, has asked investigating magistrates to get to the bottom of the scandal as quickly as possible.

Influential sports newspaper Gazzetta dello Sport has published an Ipsos poll that said 30% of those interviewed believed it would take at least three years for Italian club football to recover from the scandal. Not only that, but any team found to be involved in the match-fixing should be relegated to the B League, and suspicion is now centering on three powerful A League teams - Juventus, Fiorentina and Lazi.

If indeed those three teams are relegated then those A League contracts Sky and Mediaset hold are suddenly not worth near as much as they were before. Both companies no doubt will want to negotiate.

There is also talk that the next A League season, set to start in August, could well be delayed by at least two months as the investigation continues. Again, something that won’t help the financial numbers at both Sky and Mediaset.

The one consolation for Berlusconi in all this is that this is one scandal he appears not to be involved in directly. His AC Milan football team apparently is not part of the ongoing investigation.

Prodi has a two-seat majority in the Italian Senate and he survived his first test of no confidence last week. But with his unwieldy coalition it should only be a matter of time before his government falls.

Next time maybe Berlusconi will do at least 25,000 votes better, and he’ll want that to happen before any conflict of interest law gets passed!

If there is any doubt that Silvio Berlusconi knows how to work the media you simply have to look at his tactics during the recent election. Starting the unofficial campaign some eight points down he lost by just one-tenth of one per cent. It was a classic lesson in how to use the media.