Romania’s media sector in turmoil

Romania’s media sector in turmoil
By Clare Nuttall and Carmen Simion in Bucharest September 14, 2017

Romania’s media sector is in a bad way. Several of Romania’s top media moguls have been sent to jail, are under investigation or have simply fled the country in recent years. Already overcrowded and financially shaky, the sector is ripe for consolidation, but changing ownership is not likely to solve the problem of politically polarised reporting or the lack of media pluralism in the country.

A recent rise in advertising revenues, thanks to Romania’s robust GDP growth and ongoing consumer boom, has provided a temporary respite for media that have been ground down by years of financial difficulties. But while some outlets were able to return to profitability in the last couple of years, overall much of the sector remains distressed. And this is likely to continue as part of the global shift away from traditional publishing and the rise of online content that has put the squeeze on advertising revenues worldwide.

Observers of the Romanian media scene anticipate a wave of M&A in the sector. PwC forecasts consolidation in the media, along with a number of other sectors in Romania such as financial services, healthcare and FMCG. “The media sector in particular could experience further consolidation in the near future,” PwC Romania partner, transactions, Cornelia Bumbacea told bne IntelliNews.

“There are currently around 10 media trusts with activities in radio and television, written press, online. Given the multitude of TV stations, newspapers, radios, we can expect further consolidation/acquisitions in the Romanian market, to access new subsections or to strengthen their presence in a particular media segment.” This was echoed by a Bucharest-based corporate lawyer in an off the record conversation with bne. He described media as a “distressed sector”, pointing out that, “Romania is heavily over-invested in media, especially TV stations, many of which are political vehicles and are in deep trouble. A lot are unprofitable and permanently on the verge of bankruptcy. It’s a similar situation with radio.” As a result, he forecast, “there could be bargains”.

Dealmaking seems to have started already. Prima TV owner, Cristi Burci, has reportedly agreed to sell his TV channel to Adrian Tomsa, a business partner of Zoltan Teszari, a local investor and the founder of independent broadcaster Digi TV, according to Prima became insolvent in 2015, and the agreement will come into force only if Prima TV manages to solve the issues related to its insolvency, claims. Following the transaction, Prima TV would use some of Digi 24’s technical equipment.

What’s happening in Romania is happening everywhere. Globally, consumption of traditional media has dropped by 13% over the last seven years even though it still accounts for over two-thirds of consumption, according to media consultancy Zenith Media. The century-old Associated Press (AP) dominates all its rivals by a wide margin as the main source of news on Facebook, a recent survey found. It seems traditional journalism still counts; what’s changed is how it is delivered and consumed.

Zenith forecasts that consumption of newspapers, magazines, broadcast television and radio will continue to decline, while new areas will expand — consumption of media via mobile internet is forecast to soar from 19% of the total in 2016 to 26% in 2019.

But this tells only part of the story in Romania, a country whose media scene has been dominated since the 1990s by a handful of powerful businessmen who built up large holdings spanning television, radio and print.

They include Dan Voiculescu’s Intact Media Group, which started out in 1991 with the founding of Intact Printing House, and now includes major television stations such as Antena 1 and Antena 3, and high-profile magazines like Gazeta Sporturilor. Adrian Sarbu, nicknamed "The Shogun” was another hugely influential media baron for two decades (and financed the very first issue of bne, although he never became an investor). Another is Sorin Ovidiu Vantu, former owner of the Realitatea Catavencu media holding.

The main outside player is Central European Media Enterprises (CME), though it entered the market in 1995 in partnership with Sarbu's Media Pro.

Financially shaky

While most of these men started building up their empires in the 1990s, from the start of the financial crisis in 2008-2009 the media they owned became increasingly politically tinted and — in some cases — inclined to put out fake news, long before the phenomenon gained prominence in the 2016 US election campaign.

The lack of financial viability of many media outlets helped build up concentrated ownership in the sector; since few outlets offered strong profitability they were more attractive to already successful businesspeople seeking to increase their political influence than to investors hoping to make some money. This situation was exacerbated with the start of the international economic crisis.

“The financial crisis really played a very big role … for the [printed] press there was a 70% fall in advertising and they depended on ads; this was not a model based on subs or sales in kiosks,” says Marina Popescu, lead researcher for the Romanian team at the Median Research Centre.

“This coincided with the growth of the internet, which also happened everywhere but [Romanian media] were in a much more shaky situation than elsewhere.” “The media market has been strongly affected by both the economic crisis and the changes in the media consumption patters triggered by the increasing internet penetration,” Ioana Avadani, director of the Centre for Independent Journalism in Bucharest, wrote in a comment for the Balkanmedia online platform.

“Unfortunately, the situation of the Romanian media is more or less the same: low or non-existent profits, strong politicisation or political parallelism, if you prefer this term,” Avadani said when contacted by bne for an update on the situation.

“It appears that the market picked up a bit in 2016, with major TV stations getting some profit,” she says, adding, however that “the ownership model is still there, with a mention that many local media outlets declined or were let to die as they no longer provide the significant influence they once did”.

Avadani’s comment on the recent upturn in finances is backed up by Bucharest-based agency Initiative, which publishes the annual Media Fact Book for Romania. The 2016 edition shows a 6% increase in advertising revenues in 2015 and anticipates that the market grew by a similar amount last year.

“2015 and 2016 bring a confirmation of the stabilisation of the media market in Romania,” commented Alexandra Olteanu, managing director of Initiative, when launching the report. “Of course, we cannot talk any more about booms such as the ones prior to the crisis,” she says, but still talks of “a constant and healthy rise that can bring more benefits in the media and long term for this market and for the entire marketing and communication industry”.

The report details a 7% rise in television advertising to €212mn and a 12% hike in online advertising to €57mn in 2015. Radio grew by a more modest 5% and out-of-home (OOH) remained flat, while print was the only channel to see a decline in advertising revenues in 2015, a trend that is forecast to continue.

More recent data shows that 2016 proved to be a turning point for some of Romania’s highest profile media outlets, with companies such as Vioculescu’s Antena 1 returning to profit during the year, while others hiked their profits substantially, according to datacompiled by media news site

Attack on pluralism

Nonetheless, the financial difficulties faced by independent media in Romania, and the continuing importance of politically motivated owners, are having a damaging impact on media pluralism in Romania, which intensified in the last decade from the start of the economic crisis. The financially precarious situation of many Romanian media outlets has put the journalists who work for them in a vulnerable position.

A study of 19 countries by the Bucharest-based Media Research Centre finds Romania has a higher risk for basic protection and observing journalistic standards. Furthermore, Popescu says in an interview with bne IntelliNews, the index doesn't capture the full scale of the problems in Romania.

“The media pluralism monitor looks at how the market influences pluralism but has difficulties capturing how much worse the situation is in some of the East European post-Communist countries,” she says.

“In Romania, there are very few, if any, media outlets that are economically viable except the big TV channels — and television is dominated by politically partisan channels that would be unthinkable in a West European country,” she says. This partisanship “doesn’t only affect availability of quality information, it affects the accuracy of information available.”

The survey shows Romania is one of the countries that is very high in political partisanship in all outlets and very low in accuracy, even in the most highbrow outlets. This differs from, for example southern Europe where the information may be politically coloured but it is not devoid of real content. “Part of the problem is that media channels are so unprofitable, we were in project with journalists, the problem to recruit and keep journalists long enough to train on job,” Popsecu stresses. In addition, there is no effective media regulator, nor an industry body that effectively self-regulates.

Moguls under pressure

Popescu believes that while the so-called media moguls entered the business for different reasons, all had the idea that the outlets they own are “theirs and should serve their commercial and political interests”. It’s also ego driven, she says, giving the example of one mogul who claimed he “just wants his voice to be heard”.

Some of the country’s leading media owners suffered a severe blow to their egos when they and their operations came under investigation by the National Anticorruption Directorate (DNA). This has resulted in prison terms for some, although they still pull the strings from behind the scenes.

Voiculescu, who owns one of the most influential TV news stations in the country — Antena 3 — was sentenced to 10 years in prison in August 2014 after being found guilty of the fraudulent privatisation of the Institute of Research for Food Sciences. He later received another two-year sentence for complicity to blackmail the former manager of cable TV network RCS&RDS, but was acquitted in June this year. The following month he was released on parole despite having served only three years of his original sentence, due to his old age, good behaviour and ability to take advantage of a loophole allowing prisoners to knock 30 days off their sentences for each scientific work penned while behind bars. Voiculescu authored no less than 10 during his short stint in prison.

Voiculescu fits the profile of the politically influential media owner perfectly; he was the founder of the Conservative Party and the mastermind behind the Social Liberal Union (USL) coalition, which ruled Romania from February 2011 to February 2014. He, and the journalists at his TV station, claim there were political motivations for his imprisonment; the tycoon is a harsh critic of both former President Traian Basescu and DNA head Laura Codruta Kovesi.

Another media owner, Vantu, has received several sentences, the longest of which was an eight-year sentence for money laundering in connection to the collapse of the Ponzi-style FNI investment scheme. He also has sentences connected to the bankruptcy of oil services company Petromservice, for helping Nicolae Popa, who was indicted in the FNI case, to evade justice, and for blackmailing fellow media baron Sebastian Ghita.

Unlike Vioculescu, who continues to claim he was unfairly imprisoned, Vantu has been unusually candid about his criminal activities, saying in a 2014 interview with Adevarul that he would have been issued a life sentence if the state had found out all he had done, even though he still claimed to have been sentenced for the wrong reasons.

“[Prosecutors] made up some reasons and for those I was arrested, not for what I have really done. I don’t contest the fact that I have been sent to prison. I deserved to go to prison,” he told the daily.

Ghita, who took over Realitatea TV from Vantu, is now also in difficulties. He is being investigated by the DNA in connection to several corruption scandals including one concerning a €220,000 payment allegedly indirect made to former Prime Minister Victor Ponta. The money was reportedly used to finance a conference attended by former British Prime Minister Tony Blair.

Ghita escaped from police surveillance in Romania under unclear circumstances in December, and was arrested in Serbia in April but released the following month after he paid a €200,000 bail. He is not allowed to leave Belgrade, and Romanian prosecutors are seeking his extradition.

Like Voiculescu, Ghita has used the media channels at his command to shape the political landscape in Romania. His Romania TV (RTV) emerged as a separate entity after the breakup of Realitatea TV’s editorial desk in 2011, and has been accused by other media of breaking audiovisual legislation, manipulation and promoting false information, and acting as a propaganda tool, especially during electoral campaigns.

The channel openly supported Social Democratic Party (PSD) candidate Ponta, who is close to Ghita, in the 2014 presidential election. Ponta’s first round lead was overturned when a scandal erupted over the lack of polling stations abroad and the authorities’ failure to ensure the right of the diaspora — which were expected to largely vote for Ponta’s rival Klaus Iohannis — to vote. RTV was accused of trying to mislead the public by broadcasting images of almost empty streets around polling stations in foreign cities, according to

The TV station has also intensified its attacks on the DNA and Kovesi personally in the last year. Soon after Ghita fled to Serbia, RTV broadcast a series of taped statements in which he made serious accusations against Kovesi and the former deputy head of the Romanian intelligence service Florian Coldea. Their broadcast coincided with an attempt by the PSD-led government to water down anti-corruption legislation that would have seriously undermined the work of the DNA. This sparked Romania’s largest protests since the fall of communism, which were reported in a highly negative light by RTV, which claimed at the time that “the participants, even dogs” were paid to take part.

Yet another of Romania’s most influential media owners, Sarbu, a former TV cameraman, who earned the money to start the now defunct Mediafax Group from selling a tape of the execution of Nicolae Ceausescu, was tried in 2016 on suspicion of tax evasion, instigation to tax evasion, instigation to embezzlement and money laundering.

But while their high-profile owners may be behind bars or out of the country, management and employees tend to continue to adhere to their editorial line, meaning there has been little impact on the media landscape in the country by the changes.

Struggling independents

And while the politically connected media are struggling, so too are those that aim at independence. In 2012, Digi 24, a new TV station controlled by Teszari, was launched, with its then editor-in-chief telling at the time that it would provide “clean news”.

“We do not target the audience that news TV channels have now. We are rather targeting a public who has stopped watching TV, who wants clean news and who wants to make its own comments and judgments,” Razvan Mitroi said in 2012, adding that the new TV station planned to be “fair, impartial, not distant, and to provide relevant news”.

However, despite recent reports of a tie-up with Prime TV, there are also reports that Digi 24’s management is considering closing down the station. A number of journalists in the regional news desks have already been told their contracts will not be renewed. claims the decision to close the TV channel can now only be replaced by one envisaging a massive restructuring.

Despite the financial problems on the media market, a new TV news channel is about to emerge. The National Audiovisual Council of Romania (CAN) recently issued a licence for a new cable news channel, NVN, to be launched by a Cluj-based journalist turned politician, according to

“We will follow the Euronews editorial model,” owner Liviu Alexa told the media portal. The new TV channel, which is to have national coverage, is expected to go live on December 1. “We want to make not a clone of Euronews, but a station which will replicate the idea of the European news channel, obviously adapted to local level. We have the power to finance ourselves and we also have a team that will work on this project,” Alexa told CAN.

Alexa’s NCN already operates at local level after his company took over local television station Somes TV a year ago, and he also reportedly owns the portal. In the last mayoral elections, Alexa ran in Cluj as the candidate for the new Miscarea Liberala party but lost to former prime minister Emil Boc.

In August, Alexa explained the reasons behind his move to turn the station into a national one. “There is no interest in Romania in regional news. There have been other projects and they failed,” Alexa said in an interview with “With CNC Cluj we managed in six months to cover 90% of the costs with clean advertising, without political involvement,” he added.

Aside from ventures like these, the main alternative to the big media holdings are small independent outlets, often funded by NGOs, or journalist run projects like Rise, which has a strong reputation for investigative stories but no mass market readership.

Even though Romania’s economy is growing fast, the media sector remains under pressure and independent outlets most of all. Meanwhile, the return to profitability of some of the bigger TV channels means that their owners have even less incentive to reform or allow them to stray away from their partisan lines.



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