The Tickle File is ftm's daily column of media news, complimenting the feature articles on major media issues. Tickle File items point out media happenings, from the oh-so serious to the not-so serious, that should not escape notice...in a shorter, more informal format.

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Week of February 11, 2008

Arabs To Satellite Broadcasters: “Offend Us And You’re Gone”

President Bush and his administration are big on pushing democracy in the Arab World so he won’t be pleased by a special meeting of 22 Arab Information Ministers in Cairo that has approved withdrawing permits for satellite television stations that offend Arab leaders or national or religious symbols.

Qatar, home to Al-Jazeera, was the only Arab country not to endorse the charter.

Among the charter’s rules: satellite stations should not “damage social harmony, national unity, public order or traditional values." Countries may "withdraw, freeze or not renew the work permits of media which break the regulations".

Erotic content, content promoting smoking or alcohol also falls foul of the charter.  The stations should also "protect Arab identity from the harmful effects of globalization".

Abd-al-Bariatwan, the editor in chief of the London-based al-Quds al-Arabi newspaper commented, “The semi-independent Arab media's honeymoon is apparently about to end at a record speed and the same thing can be said about Arab satellite channels' limited margin of freedom. The Arab information ministers have started to coordinate in an admirable way in order to bury these freedoms and take the Arab media back to the dark ages, that is to a media of praise, and of devoting entire news bulletins to the ruler's noble deeds, great achievements, and the welfare projects he is opening as he looks after the citizens' comfort.”

Good thing he didn’t say that on satellite television.

Iran, Kuwait Protest The Reprinting Of Those Danish Cartoons

Iran has protested to the Danish ambassador over 17 Danish newspapers reprinting cartoons that Muslims considered to be insulting to the Prophet Muhammad.

The newspapers reprinted the cartoons, first published in 2005 that caused riots throughout the Islam world in 2006, to protest an alleged plot that security forces said they broke up this week to kill the artist of the most provocative of the cartoons (see Wednesday and Thursday tickle items).

Kuwaiti politician Waleed al-Tabtabaion Thursday called for a Danish boycott, telling Parliament, “We must impose a total political and economic boycott of Denmark.”  

In Karachi students chanted slogans and burned a Danish flag.

The Danish Cartoon Story Just Won’t Go Away.

Following Tuesday’s arrest of three people (originally police said it was five) who allegedly planned to kill Kurt Westergaard (see Tuesday’s tickle item) who drew the cartoon of a bomb in the turban of the Prophet Mohammad that in 2005 caused riots around the world with some 100 people dead, at least 17 Danish newspapers reprinted the cartoon Wednesday to make their point of “freedom of the press.”

The Danish Foreign Ministry said meanwhile it was following the situation closely, fearful of a repeat of Danish embassies burning in the Islam world.

French Broadcast Strikers March In Paris

About 1,000 public broadcast employees marched through Paris Wednesday afternoon to protest proposed changes for Public Broadcasting as announced by President Nicolas Sarkozy last month (see Tuesday tickle item below for background).

Public broadcast employees went on strike for 24 hours and most news programs were replaced, on the radio by music and on television by cartoons and sitcoms.

The Real Cuts Start At Tribune

Tribune is reporting that some 400 – 500 jobs are going to be lost, mostly in Chicago and Los Angeles, but it is the reason behind them that bears close scrutiny.

Chicago Tribune Publisher Scott Smith told his staff that total revenue from the Chicago media group was off 5% in January and that "ad revenue was down double digits, a continuation of the trend late last year." Cash flow – all important to pay the debt – fell more than the 8% it fell in 2007, he said. "The near term outlook shows few signs of improvement."

In Los Angeles publisher David Hiller of The Times said things were far worse than had been forecast late last year when real estate magnate Sam Zell took Tribune Co. private in an $8.2 billion buyout.

In other words, the newspaper business is seeing no recovery and things have to be done fast to get the cash flow to where the company needs it to make the debt payments. Not an auspicious start.

Journalists At The WSJ Seem To Be Happy With Murdoch

Remember when Rupert Murdoch first announced his bid to buy Dow Jones last year, and how the journalists there went crazy, saying he would ruin their craft, dumb-down the newspaper and all of that.

Well, Murdoch has had The Wall Street Journal in his hands now for about eight weeks and changes are already appearing – more general news stories, more photos. The New York Times did a take-out on the situation – remember News Corp says it is gunning for the Journal to become the Times’ main competitor, but the last paragraph of the Times’ story tells the story.

“We work at a newspaper where the owner is hiring and throwing money at the business, while the rest of the industry could not be grimmer,” an editor said, declining to be identified. “There are other, more inchoate fears about where this ends up. But in the short term, it’s exciting.”

In other words, so far, so good.

French Broadcasters March In Paris Today Opposing Sarkozy Plans

French TV employees don’t like the sound of President Nicolas Sarkozy’s plans for France’s public and private broadcast stations so they are doing this afternoon what French employees usually do when they get really unhappy en masse – they are striking for 24 hours and marching in protest through the streets of Paris.  Programming is expected to be severely affected.

Sarkozy shocked French private and public television last month saying he wanted to move advertising off state-owned TV stations and that he wanted to merge France 24, the French international 24-hour TV news channel, perhaps getting rid of its non-French languages, with international channel TV5 Monde and Radio France International (what about its foreign language services?) to copy the basic format of the BBC World Service. There are reports that have been denied that he wants to privatize public broadcaster France 3.

If Sarkozy’s plans were to go ahead then public broadcasters would lose about €800million ($1.2 billion) in annual advertising revenue. Sarkozy plans to fund them by added taxes on the revenue earned by commercial broadcasters, plus a new tax on mobile phone operators and internet service providers.  But would all of that be a wash?  France’s 11,000 public broadcasting employees believe the new plan will result in a severe shortage of funding and therefore a loss of jobs

Danish Security Says It Foils Assassination Plot Against Cartoonist

The Danish Intelligence Service says it has stopped what it believes was an assassination plot by five people against the artist who drew the Prophet Mohammad cartoon that most riled the international Islam community – the cartoon with a bomb hidden in the Prophet’s turban.

And to illustrate the story of the men’s arrest, Jyllands-Posten, the largest circulation Danish newspaper that originally printed that cartoon and others back in 2005, reprinted the turban cartoon Tuesday.

In 5 a.m. raids the police arrested five people, three Danes and two foreigners said to be from Tunisia. Security officials said the plot was at a very early stage but police wanted to stop it before it got further.  First reports said the foreigners would likely be expelled indicating perhaps not enough evidence to hold them for trial.

The cartoonist, 73-year-old Kurt Westergaard, said in a statement posted on the Jyllands-Posten web site, “Of course, I fear for my life after the Danish security and intelligence service informed me of plans of certain people to kill me. However, I have turned fear into anger and indignation. It has made me angry that a perfectly normal everyday activity which I used to do by the thousand was abused and set off such madness. I have attended to my work and still do. I could not possibly have known how long I would have to live under police protection; I think, however, that the impact of the insane response to my cartoon will last for the rest of my life. It is sad, indeed, but it has become a fact of my life.”

Kassem Ahmad, chairman of Denmark’s Organization of the Islamic Faith, said, “There is freedom of the press in Denmark, and we have closed this issue.” The group had previously unsuccessfully lobbied the Danish government to apologize for the printing of the cartoons and to impose sanctions on Jyllands-Posten.

Major broadcaster dumps digital broadcasting
“…not economically viable…”

For at least the last three years proponents of the digital radio standard DAB (Digital Audio Broadcasting) have pointed to the UK market as its major success story. All of that turned (Monday) when GCap Media Chief Executive Fru Hazlitt threw in the towel, announcing the sale of the company’s stake in a DAB multiplex and the closure of its two DAB-only radio channels.

Suffice it to say that in the next few days, when the dust settles, there will be more to say. I’m aware that the ABC (public broadcasting) in Australia and the Norwegian media regulator are taking ‘a hard look’ at developments, or lack thereof, in the UK.

WorldDMB responded, pointing out that “As with many platforms it takes time to generate profit and the road to success may seem long for some.” (Read WorldDMB presser here)

Time isn’t on GCap’s side as it’s in the midst of a hostile take-over. Such is the life of the publicly traded media company. Shareholders, as the Bancroft family proved to Mr. Murdoch, vote their personal bank accounts…nothing more, nothing less. (JMH)

Getty Sale Falters, Shares Get Nailed, As Equity Funds Dry Up…

ANew York Times story Monday that an auction of Getty Images might be in trouble slaughtered its shares, with the closing down 9.20% over Friday. The $2.45 drop on the day values the company now at $1.44 billion. The Times’ story indicated private equity firms were having trouble coming up with the $1.6 billion financing that the company was valued at Friday.

The shares are still 10% higher than their 52-week low hit before the company announced in January that it was looking to sell itself, but shareholders certainly weren’t happy to read that a sale might not happen.

According to the Times there are probably two problems with any sale –private equity has dried up for new deals such as this, and there is some question whether licensed photos rights are a growing business. There is no question that Getty has product, but it is being seriously undercut on price by Internet competitors.

…But Might There Be Money For a $2 Billion Deal For Setanta?

Irish sports broadcaster Setanta says it is considering putting itself up for sale in an auction after having already receiving a bid in excess of €1.3 billion ($2 billion). So equity financing is out there after all!  The company, incidentally, has yet to make a profit!

It has hired Goldman Sachs as adviser (it obviously hopes it will have more luck with Goldman than Getty Images appears to be having with Goldman as its adviser – see above tickle item.)

Among companies thought to be interested are BT, ITV, Virgin Media and Disney - the owner of sports network ESPN, the latter wanting particularly to break into the lucrative UK soccer rights business. Setanta agreed in 2006 to pay €500m over three years to share live Premiership football coverage with BSkyB.

Belo Joint Value Drops On First Day Of Trade For Old and New Companies

Belo made history on Monday by splitting itself into two companies – A.H. Belo for its newspaper properties, with no debt -- and the old Belo that now holds broadcast properties and everything else that is not a newspaper. It also holds all of the prior debt. So how did the two companies do on their first day as compared to being just one company on the New York Stock Exchange?

If you held 100 shares of Belo on Friday they were worth at the close $$1,636. On Monday you would still have had 100 shares of Belo but also 20 shares of the new A.H. Belo (shareholders given the A.H. Belo shares at a 5:1 ratio of their holdings January 25.)  So, 100 shares of Belo were worth $1,324 at Monday’s close and 20 shares of A.H. Belo were worth $288. Add the two together and it makes for $1,612 as compared to that Friday value of $1,636 – in other words total value went down 1.5%.

The silver lining is that the Belo shares closed higher than they opened, whereas the A.H.Belo shares closed down. The expectation is that the Belo shares will “take-off” since they don’t have newspaper properties dragging them down whereas it’s anyone’s guess what will happen at A.H. Belo, but in the short-term, at least, with newspapers reporting even harder times, there probably won’t be much improvement.

Talent scramble in South Africa
…new TV channels recruit worldwide…

New pay-TV channels in South Africa are raiding traditional broadcasters and even recruiting foreigners, says Business Day (Johannesburg). Well-known television and radio talent is vacating public broadcaster SABC and commercial channels for e.Sat, the newly licensed pay-TV channel.

Telkom Media, according to Business Day, has been recruiting South African ex-pats working in the UK.

“Now is a good time to be a journalist,” said e.Sat editor-in-chief Debra Patta. (See Africa - Media made to order - ftm Knowledge file) (JMH)

Radio for Euro 2008 football fans in Austria, Switzerland
…more football, more often…

Fans in major cities in Austria and Switzerland will be able to tune in to non-stop football news on short-term licensed FM radio stations.

Fanradio is planned to operate in the Austrian cities Vienna, Innsbruck, Salzburg and Klagenfurt from May 24th until July 13th, though, according to der Standard, the Vienna license is in some question.  The special event radio channel is licensed to Hit 92.9 FM Radio GmbH.

Big football songs and “the coolest party hits” will fill the spaces between reports and interviews. Plans include live streaming on the internet and mobile phone from May 1st.

In Switzerland Radio11 will be on the air in Zürich, Basel, Bern and Geneva between June 1st and 30th with tourist and ‘lifestyle’ information in English, German and French, with a smattering of other languages. Station organizers report they will be employing as many as 30 people and operating from a Zürich main studio.

The licensing of Radio11 by Swiss regulator BAKOM is somewhat unusual. Event organizers commonly use short-term radio licenses but this is the first short-term license for a quasi-national radio channel. Radio11 will start on-line streaming February 15th.

Both the Austrian and Swiss Euro 2008 radio channels organizers emphasize the fans, the parties and tourist information. Public service broadcasters ORF and SSR-SRG hold rights for play-by-play coverage. (JMH)

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