The clown isn't Ronald in Mongolian story on McDonald's

By bne IntelliNews January 23, 2014

Terrence Edwards in Ulaanbaatar -

When reports emerged on December 10 that McDonald's would open its first branch in Mongolia, the media and the internet were abuzz with speculation the US fast food franchise would be serving "McMutton burgers" and "goat milkshakes". The only problem: Ronald McDonald wasn't actually coming and neither were his burgers.

In fact, the "news" about McDonald's was a publicity stunt by one of Mongolia's newest TV news broadcasters, Mongol TV, to highlight how easily corporations and politicians can pay to have stories published that, among other things, are used to cast aspersions on controversial mining projects such as Rio Tinto's Oyu Tolgoi or Centerra Gold's Boroo.

Erdene Lkhagva, an executive producer at Mongol TV who took part in the ruse, says the main intent of the fictitious press release was to catch reporters and news groups in the act of compromising ethics for financial gain. "[Reporters] come with different packages for their approach, with some writing business proposals where they say they will cover you and your campaign. Some even approach businessmen, politicians and teachers to scare them. I call them racketeers. They're blackmailing them for work," Lkhagva says.

Lkhagva explains he phoned nine of Mongolia's major news outlets in television broadcasting and print to push the story, paying out between about $115 and $350 to get it covered. Then on December 11 Mongol TV confessed live on its 9 o'clock news programme that the story was a prank and named every print newspaper and broadcaster that had run the story, including the Mongolian National Broadcaster. (bne did not cover the story, though last year it did report correctly on how another fast food franchise KFC plans to open up in Ulaanbaatar.)

The response from those news groups was fierce. "Some journalists wrote hate [mail] to us and our reporters," sighs Lkhagva.


"The major problem is the reliability of information in Mongolia," complains Davaasuren Bat-oktyabri, head of news at competing television broadcaster C1 Television.

Bat-oktyabri says little editorial oversight in newsrooms and a lack of fact checking are responsible for the dissemination of false information. Part of the problem is the lack of professionalism and low pay. "If you look at the media business model now, it's not correct in the sense that people don't earn enough," he says. "The price [for advertising] is so low that most businesses shouldn't work. In recent months, many of the local TV stations are laying off hundreds of people."

Foreign companies are particularly vulnerable when facing large local conglomerates with ties to the Mongolian media. Rio Tinto's Oyu Tolgoi - a $6 billion-plus project that has been the centre of arguments over foreign investor influence in the economy and so a magnet for bad press - came under fire after announcing innocently that some of the precious metals for the 2012 Olympic medals was sourced from Oyu Tolgoi.

However, an evening news report by local television network TV9 falsely claimed around the time of the start of the Olympics that samples used for the medals were in actuality eight tonnes of gold, copper and silver smuggled out of the country, without any royalties or tax paid to the country.

On Oyu Tolgoi's website that claim is refuted, saying most of the metal used came from Rio's Kennecott Utah Copper mine. "The small portion of the ore provided from our newest mine at Oyu Tolgoi comes from core samples taken during exploration," it says.

Betina Infante, managing director of Breakthrough PR, which has in the past done work for Oyu Tolgoi, says any inaccurate reporting for such a high-profile project that is constantly in the headlines is a huge blow and has to be corrected immediately. She says setting the record straight, although not without obstacles in Mongolia, is paramount.

In addition to building strong relationships with media groups such as Unuudur newspaper or the Mongolian National Broadcaster, social media has become a viable option for engaging with the public. "There's close to 600,000-plus on Facebook, and that's growing quite a bit," Infante says. That number is nearly a fifth of the Mongolian population.

Learning by example

The entrance of US media groups into the market could also be a positive influence. Sponsored by the locally owned Trade and Development Bank of Mongolia, Bloomberg opened an affiliate television network in Ulaanbaatar in 2012. More recently, CNN entered into a partnership agreement with Eagle TV - one of the companies that reported the false McDonald's story. The CNN partnership will include training for the Mongolian staff. "Having that kind of competition is great for a media market. Raising the bar means everyone's going up," says Infante.

Meanwhile, Lkhagva has vowed that the Mongolian-owned Mongol TV will continue to expose bad practices in the media, while trying to set a good example of how responsible media should act. "I think as a young reporter, working in a newsroom is an easy way to grow corrupt, ideologically or by accepting payments for stories," Lkhagva says. "The pay is low and the pressure is high, and there are lots of people trying to feed you stories."

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