Market Development Struggles Between Waiting And Wanting

Michael Hedges November 3, 2014 Follow on Twitter

The health of a media market can be measured by one particular vital sign, the radio sector. Listeners are engaged by stories and songs, dialects and sounds making radio stations part of the local conversation. Reliable and accessible yet always changing radio is the perfect bridge to the new media environment. Advertisers benefit from this and, in turn, make radio broadcasting a good business. That is, in theory, the way it’s supposed to work.

Radio broadcasting has a deep tradition in the eight countries of south-central Europe commonly known as the Western Balkans. While print media and television remained closed to reporters, storytellers and producers radio stations opened to a variety of voices. The ever-present thumb of state media control began to relax.

Best estimates show about 900 radio stations and channels in the region serving a population of 25 million, roughly 36 per million. The distribution across countries varies widely. The number of radio stations in Serbia grew to roughly 500 post-conflict, according to IREX. Licensing rules weeded out many over the next decade and it’s estimated that about 300 operate today, about 42 per million.

In Slovenia there were 27 radio stations and channels in 1991. The number grew rapidly over the next two decades to 98 in 2010. By 2013, according to Slovenian regulator Agency for Communication Networks and Services (AKSO), about 10% had disappeared, mostly for financial reasons.

Montenegro and Kosovo, with the smallest populations, have the greatest number of radio stations per million, 63 and 51, respectively. Albania and Macedonia have the least, 16 and 23 per million population, respectively. International development organizations have favored radio as an effective means to jump-start media sectors in post-conflict regions in transition. Those agencies, largely governmental, continue to support media development in Kosovo while contributions to other countries, Bosnia Herzegovina excepted, have been significantly reduced.

Public broadcasting has replaced old state institutions, though independence from government is always questioned. Each has at least one national radio channel, generally for news and information, and sometimes another for programs in minority languages. Owing to ethnic and political divisions Bosnia Herzegovina (BiH) has three public broadcasters - Radio and Television of Bosnia and Herzegovina (BHRT), Radio-Television of the Federation of BiH (RTVFBiH) and Radio-Television of Republika Srpska (RTRS) - and Serbia has two, Radio Television of Serbia (RTS) and Radio Television of Vojvodina (RTV). Roughly 60 of the 144 radio stations in Bosnia Herzegovina are operated by municipal and county governments.

Radio Television Kosovo (RTK) was set up in 2001 with international support under the tutelage of the European Broadcasting Union (EBU) and patronage of the Organization for Security and Cooperation Europe (OSCE) and UNMIK. Establishing a model public service broadcaster was the plan, as it had been in BiH. Slowly RTK took shape with a television station and two radio stations, a restructured local station Radio Pristina and the UN established Radio Blue Sky folded in

Most remaining radio stations are owned privately. In each country local media tycoons have sprung up, sometimes operating more than one radio station and, more often than not, owning television stations or publishing operations. Foreign private investors never developed a great interest in the region’s radio broadcasting and those engaging in television and publishing have, largely, beat a retreat.

Serbia’s news-talk station B92, arguably a media development success story, was saved from collapse in the 1990’s by a consortium of venture financing led Media Development Loan Fund (MDLF) and grew from radio into TV, production and music publishing. MDLF (now known as Media Development Investment Fund) and others exited in 2010 as Swedish investor East Capital merged its interest with Greek proprietor Stefanos Papadopoulos to form Astonko as principal owner. Lingering cross-ownership questions Serbia’s Commission for Protection of Competition began an investigation at the end of August into whether or not a relationship exists between Mr. Papadopoulos and Greek media house Antenna Media Group, which has principally owned Serbian TV channel Prva Srpska Televizija since the end of 2009.

Radio broadcasting survives, more or less, on advertising revenues. With few exceptions public and privately-owned stations depend on the ad people. Government advertising, a source of constant controversy, is thought to contribute as much as 15% of total ad spending.

Radio advertising is proportionately higher in Serbia than other Western Balkan countries. According to published Nielsen data, radio broadcasters have taken about 5% of Serbia’s ad market in each of the three years between 2011 and 2013. The TV percentage in 2013 was 54%, down from 56% year on year. Total estimated net ad revenues in 2013 were €155 million, down from €172 million in 2012 and far below €206 million estimated for 2008. Internet advertising has risen to 9% of the total.

Ad spending and revenue data for the region is often of questionable reliability, station owners rarely opening their books. Estimates for Slovenia from Mediana IBO show radio broadcasters taking 3.1% of advertising in 2013, down from 3.4% year on year and 4.4% in 2008. Television is wholly dominant, taking more than 70%.

By contrast, “there is no advertising market in Albania,” noted Balkan Media Barometer Albania report for 2013 from the Friedrich Ebert Foundation. Though estimated media ad revenues from €27 million in 2007 to €54 million in 2011, the benefit for radio broadcasters remained a consistent 1.4%. Two-thirds of ad spending went to television, 22% to outdoor and 9% to print media.

Radio stations in the region with the most listeners are of two types: traditional music and flavor or international pop hits. National public pop music channel VAL 202 and private hit music stations Hit Radio and Radio 1 battle for the top positions in Slovenia.

In Croatia traditional stations Narodni Radio and Antena Zagreb are consistent favorites. The most recent new entry in the Zagreb market is dance music station Enter Zagreb, rebranded from the more traditional Total Zagreb.

Offering Bosnian traditional music, Kalman Radio was the most listened to BiH radio station, according to the October 2011 Mareco Index Bosnia survey of 15 to 69 year olds. The rest of the top ten included, in order, Radio Stari Grad (RSG), Radio BN, Radio Bobar, BH Radio 1, Radio Kameleon Tuzla, Novi Radio, Radio Big 2, Radio M and Radio Avaz. Surveys estimating radio listening in most Western Balkan countries are infrequent, adding to difficulties creating a marketing currency.

News and information stations are in abundance, primarily but not exclusively through public broadcasters, often criticized as pro-government mouthpieces. In addition international broadcasters – the BBC, VOA, RFI, RFE/RL, Deutsche Welle (DW) and, more recently, China Radio International – have several outlets or rebroadcasters in the region. The Serbian radio spectrum will have a new international entrant next spring. The ever-expanding Russia Today operation, widely viewed as the Russian Federation’s international propaganda organ, has opened a bureau in Belgrade led by former Moscow correspondent for Serbian newspapers Ljubinka Milincic. A web portal in Serbian will launch first, followed by the radio. RT, as it calls itself, has published a Serbian language Facebook page for a couple of years.

“In Serbia there is a need for the Russian view,” said Ms Milincic, quoted by kurir-info.rs (October 25), “because Western media has worked here for over twenty years.” Ms Milincic once wrote a flattering and widely dismissed biography of Russian Federation President Vladimir Putin.

Digital radio platform transition remains distant as governments struggle to meet next summer’s international deadline for shutting off analogue TV. As for digital radio, “We’ll wait for a better time,” said Telecommunications Ministry advisor Irini Reljin to a BIRN conference on media economics, quoted by b92.net (October 31).

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