The Role of Commercial Channels in the Closure of ERT

by Nikos Michalitsis
The Greek government decided to shut down the public broadcaster ERT on June 11, 2013. Despite international outrage, major commercial TV networks in Greece supported the government’s decision through their news bulletins and current affairs programmes. And that was not all. They also offered technical support in order to erase the voice and the image of ERT Open, that has not stopped broadcasting via the internet to this day - thanks to the employees’ decision to not let it be silenced. Commercial TV channels’ technicians were present during police operations at ERT transmitters, first turning them off and then broadcasting a digital signal with vertical bars through two private providers, OTE (Organization of Telecommunications) and Digea (Digital Provider Inc.) This raises the question of whether these private companies are in any way implicated in ERT’s shutdown. The truth is that not only are they implicated, but they also played an active role - especially Digea - in a government plan aimed at obtaining absolute control of the way the broadcasting sector will be established in the digital era.

What is Digea?
Digea’s main activity is to provide digital coding and broadcasting services for terrestrial digital television (Network Provider) and has been certified by the Hellenic Telecommunications and Post Commission only for the first phase of digital switchover at 23 locations in Greece, despite the fact that both European and Greek legislation (law 3592/2007) prohibits for a network provider to also be a content provider (namely a television station), to prevent any TV station from gaining a monopoly in the market. Digea is a consortium of six private network stations holding equal shares. Powerful people who play an important role in Greek economy in the construction, shipping and media sectors own these stations. In the past, they have been blamed by Greek prime ministers for using the power of their media groups to gain political influence in order to benefit their business activities. To this day all Greek governments, despite their declarations about the disengagement from commercial channel owners, have made an alliance with them in exchange for their scandalous support of government policies through their channels.

Digea shareholders are the following TV network stations:
- MEGA, owned by Mr. Bobolas and Mr. Psycharis
- ANT1, owned by Mr. Kyriakou
- STAR, owned by Mr. Vardinogiannis
- SKAI, owned by Mr. Alafouzos
- ALPHA, owned Mr. Kontominas
- Macedonia TV owned by Mr. Kyriakou

It should be noted that none of the aforementioned stations has a legal broadcasting license, given that the temporary license status approved by the Greek National Council for Radio and Television (ESR), has been ruled as illegal by Council of State’s decision 3578/2010.

The Tender for Digital Television Frequencies
The closure of ERT coincided with the consultations on the tender specifications for the digital television frequencies. The consultations ended on June 19, 2013 and according to Secretary General of Telecommunications of Development ministry, Menelaos Daskalakis, the tender will be announced by June 30, 2013.

According to the tender specifications (submitted for consultation before the closure of ERT) two frequencies will be assigned to ERT (instead of the previous three), four frequencies to national network providers (instead of the previous two) and two frequencies to regional network providers. ERT is recognised by the law as a network provider and does not pay for the use of the public frequencies.

The six remaining frequencies (four national and two regional) are the ones to be put up for tender. The state is supposed to obtain the largest possible profit by leasing the frequencies to private companies for a period of 15 years, with an international tender process. So far, the only trouble seems to be ERT frequencies having been decreased to two instead of three.

“Auxiliary” sudden decisions
The fact that ERT was not to take part in the bidding does not mean that it should not have participated in the consultations. On the contrary, ERT is the only entity competent to support the public interest. The sudden decision to shut down ERT prevented the public broadcaster from expressing its views even after its frequencies were decreased and assigned to private network providers. The plan for ERT’s successor as described by the government (only one television channel) predisposes for a further decrease in the number of its frequencies to one, in favour of commercial (privately owned) stations. It also responds to the commercial TV stations demand for a diminishing of the public broadcaster and the elimination of ERT High Definition channel, which many private interests have been against contrary to the audience who welcomed it enthusiastically.

Auxiliary “omissions”
A strange “omission” in specifications makes it certain that Digea will be the successful bidder. Greece is the only country in the world where a tender process has been announced for a network provider (that will offer technical broadcasting services) to obtain a license, without its customers, namely the content providers (television stations), having obtained a license first. Any serious company wanting to invest in our country would need first to buy the frequencies from the state in order to sell them to television stations. The problem is that it would not find a single legal client. And this is not all. It would also encounter a competitor company established by its six biggest clients.

Have those, who originally set the specifications, ever heard of “unfair competition”? I guess not. We hope that they will not ignore the majority of answers at the consultations that identify this strange omission and declare it incompatible for the network provider to be a content provider at the same time.

Let us make certain we have no competitors
But these are not the only impediments to the participation of any other company. Specifications include a timetable for transmitter installations at 156 transmission centers (pages 45-49), with the provision of five transmitters installed at every centre. In other words a total of 780 transmitters. The timetable should start by September 30, 2013 at the latest and finish by September 30, 2014. Authorisation for antenna systems at the 156 transmission centres should start at the same time, but it is an extremely time consuming process. Other impediments are included in the specifications, especially for new providers. They need to have developed the network at all transmission centres where ERT has a presence (p. 43) within 3 months of having obtained the authorisation. Divergence from the timetable is not permitted.

Let us suppose a company wants to participate in the bidding announced on June 30. The results will be made known by the end of August. Within a month it should have secured the license for 156 antenna systems and then set up 780 transmitters within a year.

These specifications can only be fulfilled by a company that is certain of winning the tender and is adequately prepared. The closure of ERT ensures that it cannot comply with a timetable that demands for such preparations. Thus, ERT, or its successor, is out of the “frequencies game” and its own frequencies and network are allotted to private companies.

It should be noted that the only companies that asked for the outcome of the consultation to remain confidential and for their content not to be published were Digea and OTE (Deutsche Telekom). These two companies support the government to broadcast a signal with bars, as a rival to open ERT. It is an indication that they are going to bid together in the tender process.

Let us make certain of the result by a photographic proclamation
Pre-selection criteria for the participation are to be found on page 71 of specifications. The first two criteria concerning financial and technical adequacy are correct. But what about the third one? That is: “The ability of digital switchover management and the capacity to inform the public.” It sets marketing for the digital switchover as a criterion according to which a contestant (especially in Greece) might be eliminated. It assumes, indirectly, that there are no other companies capable of designing and launching their own marketing campaign.

We want it all…
Now that we know that the network is ours, let us take all frequencies instead of letting them be assigned to more than one company. The writer of specifications takes care of that. On pages 60-64, we read in short the following reasoning: If the cost for a frequency amounts to a, and 4 different frequencies are assigned to 4 different providers, then the total cost amounts to 4a. If the frequencies are assigned to one provider, due to massive orders, the cost will be drop (2.2a). This reasoning is correct and is the main argument used by monopolies. The only objection is that this argument can be used by the buyer and not by the seller - namely the Greek state - that should be more interested in gaining the largest profit possible by encouraging healthy competition. This reasoning is being expounded on and provides for five frequencies to be assigned to the same contractor (four national and one regional). In case bidding for the one remaining regional frequency is without result, the frequency is assigned to the contractor of the other ones at the starting price (and not at the price offered). In other words, an absolute monopoly. That is why the statement of Regional Channels Union denounces the indirect financial coercion aiming at the closure of all regional channels and at Digea getting all available frequencies after ERT’s disbandment.

The final facilitations
Now that the monopolistic control over frequencies is ensured, the contractor’s cost should be reduced. The population coverage of the 156 transmission centres is estimated to 96.2%. What if 300 more centres are needed for the rest of the population? Who is to pay the cost that should be paid by the contractor? The cost that should be paid by the private contractor (Digea) is transferred to Greek citizens. On page 43 of specifications it is written that the contractor has the obligation to cooperate with local administration organizations that would be willing to shoulder the cost of the necessary transmitters!
At another point it obliges ERT to share the antenna systems masts with the private contractor!

One may well wonder what all the aforementioned facts are aiming at. It is well known that Digea shareholders have offered their support to all Greek governments and their policies, especially during these troika years of memorandums and austerity measures. The rewards for their loyal services are known and concern their financial activities. That is a fact stigmatized by most of the Greek prime ministers, usually at the beginning of their term of office, to be “forgotten” soon afterwards.

In these times, when people seek a diversity of views on the television, there should be television stations free from the five major channel owners’ control. The monopolistic control of the broadcasting network offers the government and the major channels the ability to put a stop to such phenomena, preventing content which may be critical to the government from being broadcast. Whoever believes that the network provider has no right to control content, needs only to be reminded of what has been happening recently to television stations that dare to transmit ERT Open’s programming. Within 20 seconds, Digea (following government’s orders as admitted) punished the station, replacing its programme with bars. Just consider the possibility of Digea obtaining the only available license for 15 years and instead of ERT for a parody of the once “Armed Forces Channel” (YENED) to be broadcast.

The tender process should not take place under these conditions, or democracy will suffer another severe blow.

Τελευταία τροποποίηση στις Παρασκευή, 14/06/2013 - 23:54