Interview: "Media Cannot Survive On Donations Alone"

Source: BIRN

The B92 director Veran Matic tells BIRN that the secret of the Serbian radio and television station's success lies in the fact that it was already preparing itself to survive in a competitive market long before the fall of the Milosevic regime.

BIRN: In the past 15 years, western donors have invested a lot of money in the Serbian media. Have these donations helped the independent media and to what extent?

VERAN MATIC: This aid helped many media outlets survive, but not much more. If it hadn't been provided, many would have perished or been pushed to the margins. There were also periods when there were no significant investments and there were donors who had funds for the independent media only at certain times. The only organisation that maintained consistent aid programmes was the Open Society Institute. USAID, the European Union, national donor organisations and non-governmental organisations [NGOs], in their capacity as implementers of independent media aid projects, joined this foundation now and then.

Q: Looking back, was this investment good or were there some bad aspects to it?

A: Of all the investments made [in Serbia] it was the best. The investments in political parties did not prove spectacular as they failed to create an authentic democratic environment. In most cases the democratic parties slipped back into the old undemocratic ways once they came to power. NGOs also failed to win a proper place in the process of social and political development. Some bigger ones joined political parties, while others have been sidelined, through mismanagement or by deliberate initiative of the state, which sees the NGO sector as a rival.

But the independent media have by and large survived and preserved their authenticity as democratic watchdogs. Look at the weekly news magazine Vreme, the daily paper Danas and B92, which has grown as a radio, television and website into a very successful company. These outlets have operated now for over sixteen years, instilling hope that changes are possible and that there are those who can pull them off.

The bad side concerns the frequent attempts to make aid instrumental on achieving certain political goals. After the [1995 Bosnian] Dayton peace accord we had a situation where almost no one was willing to help the independent media because [Yugoslav president Slobodan] Milosevic was seen as the guarantee of peace, and of the Accords.

Donors often don't know the right moment to act owing to their own bureaucratic style of decision-making. The most common problems stem from lack of knowledge of the local situation. This was why the most successful and most useful donors were always those with local offices.

Q: While Milosevic was in power, donors made political activists out of media outlets, granting donor money to the anti-regime media. How did Milosevic's fall influence these media and the donors?

A: Some donors certainly tried to turn media outlets into political activists but not much was achieved, which was why there were tensions between the local media and donors. The opposition [parties also] tried. to control the independent media by gaining control over the aid funds. But the independent media prevented this.

Soon after the collapse of the regime, a conflict broke out as the media continued to do their job and criticise, while the new democratic government wanted the same level of support they had received in opposition. Unfortunately, donors [who] were confused mostly gave unconditional support to the new democratic leaders. This "honeymoon" lasted for several years and is best illustrated by the statement the [later] murdered Serbian prime minister Zoran Djindjic gave to B92 in Washington, when he said, "We'll give them medals, but not broadcasting frequencies."

This terrible misunderstanding divided the reformist bloc, while the lack of understanding of the importance of independent media... meant the democratic reformist wing quickly lost its allies at the local level. The donors did not escape this trap and most often sided with the government in this confrontation. One direct consequence is that five years on we still do not have effective democratic media legislation.

The chaos in the electronic media has never been greater and the adopted media laws have not yet been implemented because it doesn't seem in the interest of the government. The most powerful western countries and some international organisations have inadvertently helped this come to pass by tolerating, or even supporting, the irresponsible and undemocratic conduct of the Serbian authorities.

Q: We often hear that donor money created media that directly depend on these donations and which will inevitably cease to exist after donor funds dry up. What do you think about the donors' exit strategy, leaving the media to battle it out on the market?

A: Media outlets that are products of donor activities should not exist anyway. Whereas media that came into existence from authentic motives and rationale have endeavoured to create a situation in which they do not depend to such a degree on aid. The very nature of donors, both the governmental and non-governmental donor organisations, is not market-oriented. They are present as long as there is crisis, but when the crisis is over they seek new flashpoints and abandon what they created.

Radio B92 hired experts two years before Milosevic fell to train the management and prepare them for the post-Milosevic period and for the stiff market competition that was to follow. This helped us not only to preserve our radio as the undisputed market leader but also to develop a competitive television [service].

Q: What was the strategy to create self-sustainable media, based on your own experiences?

A: We started preparing for sustainability long before the October 2000 changes [which saw the collapse of the Milosevic regime]. Since we had large projects, we had to draft accurate project plans and defend them before the donor consortia. So even when we mostly lived off donations we were building. This facilitated our transition to the next phase when our new skills were needed to position our company on the market. We also obtained professional assistance to develop our commercial activities early on.

In our mission statement we described ourselves as a commercial media outlet with a high degree of social responsibility by virtue of a large part of our programming content. We would be a public service broadcaster sustaining itself commercially.

The sudden withdrawal of donors is certainly shocking for any media outlet. But B92 alleviated the impact through collaboration with the Media Development Loan Fund, which specialises in assisting media in transition. In addition to favourable long-term loans, it helped with the development of managerial skills. This combination of expert knowledge and finances is the key to success.

It is expensive to train the employees of a company that has a national radio [and] television [service] and a popular web site, a publishing house, a CD label and much more. This was why our last big donation was about training and education. We succeeded in winning a grant from the European Agency for Reconstruction for education and training provided by the European Centre for Broadcast Journalism and the BBC. This training programme lasted for two years and encompassed all the employees - from journalists to top management - and it finished with an evaluation of the all the employees.

But democratic media laws have still not been implemented and we still have this chaos in the media, hampering successful development. The chaos is conducive to irregular conditions in the market, to unfair competition and a general inability to establish the values that we have been fighting for. The lack of effective democratic media laws and institutions carries a huge risk in the eyes of potential investors. When this is the case, it is better to try to survive and develop by relying on your own capital and through business deals, which should enable growth at least until the media scene is properly regulated. Only then will the media companies be able to attract good investments.

Q: Is privatisation of media outlets a solution after donations disappear? What are the positive and negative aspects?

A: Privatisation is absolutely necessary but unfortunately B92 is the only successfully privatised media company in Serbia today. Legal regulations and practice are not in place in this field and it is in the interest of the government to prolong this period when it is possible to influence the media thanks to their ownership structure.

In the case of B92, the whole process was conducted with the idea of introducing an ownership structure that would prevent changes to editorial policy.

First, we prevented the state from becoming the majority shareholder and identified friendly institutions in advance, like the MDLF, which would support our policy as a co-owner of the company. Then we distributed shares to all employees who had contributed to the development of B92.

The B92 founders and managers set up the B92 Trust to ensure the implementation of the editorial policy through controlling shares. But Trust members cannot take away these shares if they leave the company.

Q: Should Balkan media outlets continue to apply for grants? And in what areas are these grants most needed?

A: Of course there are areas in which the media should get support. Otherwise some important projects would never be implemented. The reference here above all is to education programmes and projects informing the public about Euro-Atlantic integrations, European institutions, and so on. Our decade-long isolation means we were far removed from the sources of basic information.

Then there is investigative journalism - an extremely important field for journalists to play their authentic role of democracy watchdogs. Rare are the media that can finance from their own revenues large-scale investigative projects.

Very important too are programmes aimed at facing up to our recent past. This is not a popular topic and such investigations are expensive.

Finally, the position of minorities, from ethnic to sexual, is also important.

Q: Although substantial donor funds have been spent on journalism training, professional standards remain low. If results in this field are meagre even with donations, what will happen when donor money dries up?

A: Investments in institution-building are crucial, and these institutions should help train journalists and management. The money invested here is never wasted. It will systematically help to bring good-quality journalism to the media scene. When donations dry up, I hope the existing media will develop these institutions, because their very existence is in the interest of the media outlets themselves.