Fidesz coming to a radio statio near you

How and why did the public service stations Kossuth Rádió and Dankó Rádió get hold of the frequency previously used by Neo FM? How did the redrawing of Hungary’s radio frequency map affect the already troubled radio market and the diversity of media services? That’s what we set to find out. By Gábor Polyák.

In previous writings we pointed out that over the past few years the radio market has become a political playground that comprehensively realises Fidesz’ most daring media policy visions. There is a national radio monopoly controlled by Fidesz-aligned business interests, which is duly supported by massive government advertising spending; there is a Budapest radio market in which stations (unofficially) affiliated with Fidesz reach all categories of listeners; an audience measurement scheme operated by Fidesz’ very own ‘royal supplier’; a company close to Fidesz sells local radio stations’ ad time; and radios that are politically and/or ideologically affiliated with Fidesz thrive in local radio tenders, while their market and/or political competitors are gradually forced out of the market. This is all supplemented by successful efforts to bring the public service radio in line politically, the destruction of its professional working structures, and its dumbing it down. Even Orwell would take notice.

In light of all this, let us take a closer peek at one of the crucial pieces of media policy news from the last weeks, namely the decision to hand the commercial frequencies previously used by Neo FM – and still earlier by Sláger Rádió – to Kossuth Rádió and Dankó Rádió. That is we would have taken a closer peek – if there had in fact been anything to look at. Unfortunately, though, our efforts are stayed by another gem that is a perfect illustration of the way in which the completely non-transparent public service media work: apart from a single press release there is nothing at all available to the public that would explain how and why Kossuth and Dankó were given the frequencies involved. Thus we were unable to determine whether the Media Council had examined the media market impact of restructuring the frequency arrangements, or how its decision will effect the diversity in the selection of media services.

It appears that the Media Council has decided that it – or we – can do without any notion of competition in the national commercial radio market. This is disconcerting not only on account of the revenue that the government stands to forgo but also because – as media market players and researchers have explained at Mérték’s public events – the lack of competition threatens the revenue of local radio stations. That is because Class FM holds the prices for advertising in the national radio market so low – which it can easily afford in light of the lavish public funds it rakes in – that local radio stations, too, had to significantly curb their prices to sell advertising time; which they have to do through a sales house that belongs in Fidesz’ sphere of interest, of course. Hence the national radio monopoly hampers media diversity not only through crowding out players from the national commercial radio market, but also through its indirect effect on radio business, which jeopardises the diversity of the entire radio market.

But is the Media Council even entitled to assign frequencies to public media institutions by fiat? Pursuant to the media law, the Media Council decides on the media service provision options available to public service media providers based on an examination of technological, economic, business efficiency and media policy considerations. Considering the respective needs of business efficiency, budget planning for the subsequent year, and the realisation of public service objectives, the Media Council may annually review the system of public service media providers, and decides whether it maintains the prevailing arrangement of media services as they are distributed among providers, or whether it restructures said system and reassigns or takes away certain broadcasting rights from some institutions.

The text of the law is not entirely unequivocal: E.g. can the “system of public service media” be reviewed once a year or at any time? And in any case, why is the Media Council the institution to decide this issue? What is nevertheless clear, however, is that the law expects the Media Council to justify its decisions. Technological, economic and media policy considerations need to be reviewed, which is an obvious necessity if for no other reason than because such decisions directly affect the performance of public service functions and the use of public funds. In spite of these serious responsibilities, the best the Media Council’s website has to offer are essentially meaningless decisions that enumerate the frequencies in use.

The broadcasting area expansion in December was not the Media Council’s first reshaping of the available selection of public media services. The termination of regional radio stations and the launching of Dankó Rádió, the creation of the so-called Árvízvédelmi Rádió (Flood Prevention/Control Radio) or M3 Anno, for that matter, are changes in the system of public media services that could not have been lawfully implemented without a corresponding decision by the Media Council. Except that the publicly available information fails to provide even the slightest hint as to what specific decisions authorised these changes or what those decisions were based on.

Incidentally, a common feature of such public service restructurings in Hungary is that they expand the selection of available public service media without offering any genuine innovation. Even as Dankó Rádió basically broadcasts only archive recordings, the regional public service radios had to be liquidated in the interest of its launching, a sacrifice that those in charge sought to compensate by introducing the Árvízvédelmi Rádió. M3’s operations are also expressly based on archival holdings, but even M2, which functions as a children’s channel, devotes substantial broadcasting time to playing popular tales from a childhood long ago. And in the meanwhile the public service media fail to achieve any significant breakthroughs in the online sphere. The website of the public service news show hirado.hu has failed toemerge as a competitor to origo.hu, and the public media evinces a thin grasp of social media and fails to set the pace even in the production of shows.

To illustrate the significance of expanding public media services, let us take a brief foray into the world of Western European public service broadcasting. Though it is true that there the expansion of services is not primarily focused on traditional service providers but at online services, it is worth taking a glance at the procedures that precede the launching of new services in the case of British or German public media. Needless to say, a vacuous decision cannot serve as the basis for such a process, not least because neither the European Union nor market players look favourably upon the state consuming an undue share of market resources.

Launching new BBC digital services is contingent on the results of the so-called public value test. The objective of this test is to preclude market distorting conduct in the digital services market, and to increase transparency and accountability. During this test the BBC Trust examines whether the service to be launched complies with the BBC’s objectives; whether it satisfies the quality and distinctive feature requirements; whether it creates value for consumers and citizens; what target group it seeks to reach; and whether the investment can be regarded as proportional when compared to alternative services. The British media authority, Ofcom, also examines how the planned service will affect the market involved in the short and long-run. Before its final decision, the BBC Trust conducts a public consultation. German media regulations provide for a similar procedure when it comes to expanding public media services. The so-called “three-step test” (Drei-Stufen-Test) reviews whether the planned online service promotes meeting society’s democratic, social and cultural needs, whether it enhances diversity in qualitative terms, and what its funding needs are.

There is not even a hint of such rigorous procedures in the Hungarian media laws, neither for online nor for traditional services. Consequently, a discussion paper we plan to publish in the next few weeks on the regulation of public service media will contain a suggestion on how this procedure should be regulated in the future. At the same time we will avail ourselves of all publicly accessible instruments to try to ascertain what the underlying basis was for the decisions that restructured the selection of available public service media over the past few months, and how these decisions were justified. And the instrument available in this case is a request for public interest data submitted to the Media Council.

In our data request we asked the Media Council for the following:

a) the texts of the decisions rendered by the Media Council pursuant to the Media Law’s Articles 98 (7)-(8), including the detailed reasoning;

b) all further decisions by the Media Council that have authorised any other public service media to provide linear public media services, especially the decision underlying the launching of Árvízvédelmi Rádió and M3 Anno;

c) any documents relating to analyses performed pursuant to the Media Law’s Articles 98 (7)-(8) involving the review of economic, business efficiency and media policy considerations relating to the abovementioned decision(s), as well as the documents on the results of these analyses.

Based on the Media Council’s attitude thus far, it is well conceivable that our questions will only be answered following a protracted legal suit, and hence we won’t receive a reply before 2015. Nevertheless, they know just as well as we do: they are wasting public funds on lawsuits just to prolong the inevitable.