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UKRAINE’S MEDIA FIELD: OVERVIEWInternews Ukraine
Ad Market in Ukraine
In 2008 advertising media market amounted to UAH 6,78 billion in Ukraine
UAH 2,05 billion
UAH 2,7 billion
UAH 1,03 billion
UAH 0,16 billion
UAH 0,1 billion
TV advertising Print advertising Outdoor advertising
Radio advertising Internet advertising
Ad Market in Ukraine
44%
3%34%
2%
17%
TV
Radio
Internet
Outdoor
TV MARKET
Ukraine’s TV market has grown by 35% annually.
TV = biggest advertising market share in Ukraine (44%).
Ukraine’s TV market used to be the fastest-growing market in Europe: for the last three years, it has grown by an average of 28% per year.
- .
TV MARKET
TV market has been one of the most attractive for investments in the region since:
- It has the second-largest audience in the region after Russia - 18.6 million people - ahead, in particular, Poland and Turkey.
- Its price of audience contact is three times lower than in those countries - about $ 1 per a thousand of
people.
- Ukraine occupies one of the last places in Europe according to the advertising expenditure per capita.Russia - $289Hungary - $219Czech Republic - $141Poland - $59Ukraine - $40
- .
TV MARKET
0
50
100
150
200
250
300
350
400
450
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million, USD
Year 2006 Forecast foryear 2007
Year 2007 Forecast foryear 2008
Almost actual,year 2008
Income from direct advertising on the Ukrainian TV Channels
Inter group Mr.Pinchuk Holding «VI Prioritet » (95%- «1+1») Others Total
TV MARKET: Major actors
Vigorous growth of media sector, and TV in particular, over the past 15 years, resulted in booming of number of national and regional broadcasters in Ukraine.
However, only 5 out of 30 national TV channels - Inter, 1+1, ICTV, Novyi and STB - have the rating point that exceeds 1,0%.
Traditionally, Inter keeps the leading position, though 1+1 is ready to catch up.
TV MARKET: Major actors
Rat% 18+ (50, 000 +)
2007 2008
Inter 3,15 3,01
1+1 Studio 2,28 1,72
STB 1 1,15
ICTV 0,97 1,12
Novyi kanal 0,9 1,04
TRC Ukraina 0,73 0, 83
NTN 0,42 0,4
TET 0,38 0,34
5 kanal 0,3 0,24
First National 0,29 0,28
Other TV 1,5 1,72
Total TV 14,22 14,36
Ratings
TV MARKET: Diversification
Diversification of TV media area, emergence of new, mostly specialized, broadcasters, is a new trend in Ukraine’s media market
• news-focusing channels (5 Kanal, 24, Pershyi Diloviy), • sports channels (Megasport, Sport-1 and Sport-2), • focusing on “middle class” audience (K1, К2), • cinema channels (Kino, Enter-film etc) • music channels (Enter-Music, M1, M2, etc. • business channels (Pershy Dilovy, UBC, etc)• cuisine channels• automotive channel
TV MARKET: Diversification
Increasing the TV numberIncreasing the TV number
According to optimistic forecasts, total number of TV channels will reach 100 in 10 years, most of which will be specialized. In this field Ukraine follows a worldwide trend.
Some financial infoSome financial info
To date a thematic TV channel can be profitable having only 1% of the audience.
At the same time investments required to launch a new TV channel are estimated at $8-10 million on average.
TV MARKET: Digital TV Broadcasting
Ukraine has joined the Geneva-2006 project launched with the aim to facilitate transition from analogue to digital television by 2015.
Challenges:Challenges:
• large-scale public investment to be coordinated by the Ukraine’s Transport and Communications Ministry.
• replacement analogue transmitters with digital ones and implement a number of comprehensive investment projects, a task that might cost up to $ 160 – 200 million.
• promotion of digital standards among the population especially in rural regions
• the government had cut expenditures on development of digital television which could lead to eventual slowdown of the process.
TV MARKET: Public Broadcasting System
• the public discussion on the launch – 2004 – 2005• 4 concept papers on the PBS Development in Ukraine• a host of official documents (such as Presidential decrees) to
encourage the PBS introducing• slowing down the issue• no political will since every political force wants to control the media
resource during election periods
Radio Market: General trends
Ukrainian radio has been grown by 25 % annually for recent years.
The market volume has reached $36 million in 2007.
Despite this dynamic trend, total share of radio space in Ukraine’s advertising market is modest (less than 3%).
A new remarkable trend on the market is observed:
with the aim to extend broadcasting networks, the large radio holding companies purchase local wireless stations.
Radio Market: General trends
Ukrainian radio has been grown by 25 % annually for recent years.
The market volume has reached $36 million in 2007.
Despite this dynamic trend, total share of radio space in Ukraine’s advertising market is modest (less than 3%).
A new remarkable trend on the market is observed:
with the aim to extend broadcasting networks, the large radio holding companies purchase local wireless stations.
Radio Market: Key players
Radio group («Russkoe Radio»,«Hit FM» and “Kiss FM”)
Ukrainian Media Holding («Europa-plus Ukraine», «Vzrosloe Radio»and «Avtoradio»)
other
There are two major media groups possessing up to 40% of Ukraine’s radio market: the Radio-group (that includes «Russkoe Radio», «Hit FM» and “Kiss FM”), possessing a 25% market share, and Ukrainian Media Holding («Europa-plus Ukraine», «Vzrosloe Radio» and «Avtoradio») possessing up to 15% of the market.
Radio Market: Foreign investment
The market is attractive for foreign investors:
Example:Example:
Communicorp Group, leading Irish commercial radio broadcaster, operated
• ”Nashe Radio" • “Radio Apelsin” (now – “NRJ” Radio)
Radio Market: Radio advertising
Demand for radio advertising is mostly expressed by: • car industry, • furniture companies, • wine and spirits companies, • telecommunications, • entertainment.
Advertising costs have reached $270 per minute in prime time, and $160 per minute at night/late evening.
PRINT MEDIA
Growth
Ukraine’s print media market started to grow rapidly at the end of 1990s. It developed with an even greater speed after the Orange Revolution in 2004, inspired by a greater freedom of press, the Revolution’s biggest achievement. 2005 is generally seen as a breakthrough year.
Example:
Ukrainian market of daily press grew by 60% in 2006; growth rates of weekly press market accounted for 38%.
But it used to be
PRINT MEDIA: Ad trends
• formation of new media holdings and sales houses;
• active purchase of separate projects by existent media holdings and launch of new projects on the market, including entry of the worldwide known foreign brands;
• emergence of new segments at the Ukrainian market of print media;
• spread of expensive publishing technologies and enhancing quality of existent print media projects;
PRINT MEDIA: Foreign interventions
Russian presence
The Russian market keeps playing a significant role in Ukrainian press market
Western entering Ukraine’s press market
Big international actors have also started to enter Ukrainian print media market (Burda, Handelsblatt, Edipresse), though their share remains far less significant than in Eastern EU Members (Poland, Hungary, Czech Republic, Romania etc).
PRINT MEDIA: Foreign interventions
Other big multinationals include in Ukraine:
Axel Springer – a German-based leading international publishing group. It owns Ukrainian versions of Auto Bild and Auto Bild Allrad.
Bertelsmann – a German-based leading international publishing group. In Ukraine it owns a publishing group Klub semejnogo dosuga (The Family Spare Time Club) and a magazine Biographia
Lagardère – a French-based large international media group. In Ukraine it owns, through Hachette Filipachi Medias, the Ukrainian version of ELLE, a magazine focused on female audience.
Havas – a French-based large advertising and communication holding. In Ukraine it owns agencies MPG and Euro RSCG Kiev
PRINT MEDIA: Diversification
Business oriented editionsBusiness oriented editions
new specialized editions and publications emerged or re-branded that target business or ‘middle-class” audience (newspapers Delo, Delovaia Stolitsa, Ekonomicheskie izvestia; magazines Vlast Deneg, Focus etc).
Goods oriented editionsGoods oriented editions
Print press focusing on FMCGs (fast moving consumer goods) or high-tech goods also develops vigorously. Expectedly, automobile focusing titles took the lead.
Entertainment oriented editionsEntertainment oriented editions
city-guides, travel guides, etc.
Gender oriented editionsGender oriented editions
female and male magazines
PRINT MEDIA: Obstacles
In Ukrainian regions, poor print quality, unstructured and poorly developed of distribution are the major deterrents of press development.
And global financial crisis (see below).
Online / Digital Publishing
Monthly UAnet’s audience = 7,2 – 8 million users
2008 – annual audience growth – more than 30%
Geographically, 57% of UAnet users today live in Kiev (the capital city). Their monthly growth is currently 14%.
The 31% share belongs to other big cities (Dnipropetrovsk, Odessa, Kharkiv, L'viv, Zaporizhia, Donetsk).
Only 12% of Ukrainians using Internet live in the rest of the country.
Western regions demonstrate higher growth rates (40% per month), while Central and Eastern regions are a bit less dynamic (10-18%).
Online / Digital Publishing
The volume of online advertising is still relatively small – 2% .
But there is space for growth since:• the audience of other media channels is currently decreasing
• marketing budgets of business companies outflow from traditional media
• the calculating and survey of Internet audience is more precise (possibility of targeting)
• paying capacity of Internet users is higher than ones of traditional media
Online / Digital Publishing: New trends
• convergence and multimedia development • blogging• citizen journalism• on-line communities
Major Media Groups
Central European Media Enterprises Central European Media Enterprises (CME)(CME) – an international media group owning 18 TV channels in Central and Eastern Europe (Czech Republic, Croatia, Romania, Slovakia, Slovenia and Ukraine), with revenues of $ 1 billion in 2008.
In Ukraine it has 100% interest in Studia 1+1 (second largest TV channel) and controlled Kino TV Channel. Recently CME has expressed its claim to buy 10% of Glavred Media Holding.
Major Media Groups
U.A. Inter Media Group LtdU.A. Inter Media Group Ltd.– a Ukrainian media group, owned by former Ukrainian businessman and current Deputy Head of Security Service of Ukraine Valeriy Khoroshkovski and influenced by an Ukrainian businessman Dmytro Firtash, one of the owners of a gas company RosUkrEnergo
In Ukraine, it owns 61% of TV channel Inter (Ukrainian Independent TV corporation), Ukraine’s most popular TV channel, TV channels Inter+ (an Inter’s satellite subsidiary), Enter-Music, Enter-Film, K1, K2, Megasport, NTN, a web-site podrobnosti.ua and an information agency Ukrajinsky novyny.
Major Media Groups
Ukrainian Media HoldingUkrainian Media Holding – a Ukrainian media group owning up to 63 print media titles, including “general interest” newspapers (Komsomolskaia pravda-Ukraina, Argumenty I Fakty–Ukraina), tabloids (Express-gazeta – Ukraina), sports magazines (Komanda, Football, Sport Express v Ukraine), automobile magazines (Ukraina Za Ruliom), TV guides (Telenedelia, Telegid), etc. 4 network radio stations and 3 local ones, 10 news internet sites, Baluka TV company (4 niche TV channels in Ukraine). T
The UMH, a Dutch-based company managing Ukrainian Media Holding’s pyramid, also controls typography Ukrpoligrafmedia, dispatcher company Print-express etc.
In 2008 United Media Holding (UMH) has completed placement of a 15% equity stake for USD 45 mln, putting its MCap at USD 300 mln and becoming the first Ukrainian media company to list on a foreign stock exchange. Concorde Capital acted as sole financial advisor and bookrunner.
Major Media Groups
Glavred Media HoldingGlavred Media Holding (Glavred – info and analytical agency, Glаvred – periodical, Telekritika.ua, Telekritika – periodical, Сity TV Channel, UNIAN – info agency, TeleCity – periodical, Gazeta-po Kyievski Newspaper, Profile-Ukraine Periodical, “Izvestiya v Ukraine” Newspaper, Novaya Newspaper).
The media holding is owned by Privat business group of Mr. Kolomoysky, the 3d richest person in Ukraine.
Major Media Groups
Victor Pinchuk’s media groupVictor Pinchuk’s media group – a Ukrainian media group controlled by Victor Pinchuk, the 2nd richest businessman in Ukraine.
It owns in Ukraine TV channels Novyi Kanal, STB and ICTV – broadcasters with the third, the fourth and the fifth TV market shares, respectively. It also owns M1 and M2, Ukraine’s youth- and music-focused TV channels. The media group also controls Facts and comments newspaper owning the biggest audience among Ukrainian daily newspapers and has bought Economica Publishing House (business daily Delo, business weekly Investgazeta).
Major Media Groups
System Capital ManagementSystem Capital Management (SCM) (SCM) – the Ukraine’s largest business group (with assets exceeding $7,3 billion in 2008) controlled by Rinat Akhmetov, the country’s wealthiest businessman.
Even though media sector does not play a leading role in SCM’s economic structure (mostly focused on coal and steel, energy, financial sector, sports and hotel business) it has an important share in Rinat Akhmetov’s business.
SCM’s media element includes publishing group Segodnia, a newspaper Salon Dona i Basa and the sixth popular Ukrainian TV Channel TRK Ukraina. The latter, used to base in Donetsk, now has its headquarters in Kiev. The media holding has launched new channel Football and is to start News Channel.
Major Media Groups
Ukrainian industrial and investment concernUkrainian industrial and investment concern (Ukrainskyi promyslovo-investytsiynyi konzern) - a business group controlled by Ukrainian businessman Petro Poroshenko, one of the leading figures in Ukraine’s Orange Revolution and postrevolutionary politics. It owns 60% of 5 Kanal, and a radio station Radio 5. 5 Kanal , Ukraine’s first independent news channel and one of the most popular information sources during the Orange Revolution, lost its positions for the past years.
Major Media Groups
KP MediaKP Media – a media group, managed by Jed Sunden, a pioneer American businessman on Ukraine’s media market. In Ukraine KP Media owns Kyiv Post (a daily English-language newspaper, founded in 1995), Korresponent (Ukraine’s most popular weekly “middle-class” magazine), korrespondent.net (one of the most attended news web-sites ), Afisha (Ukraine’s leading city-guide, focusing of cultural life and entertainment), bigmir.net (one of the Ukraine’s leading Internet portals), UkrBiz.net (Ukrainian business portal), Ricardo (focused on economic news and analysis), 15 Minut (Ukraine’s first free daily newspaper), Pink and Pani (female magazines) etc.
In 2006 KP Media made an IPO due to which it raised $11 million.
Major Media Groups
Blits-Inform Blits-Inform – a Ukrainian media holding that publishes Natali (Ukraine’s most popular female magazine), Business (a business weekly newspaper), Bukhgalteria (a weekly newspaper on accounting) etc.
Karavan MediaKaravan Media – a Ukrainian group that publishes Karavan Istoriy. Ukraina (entertainment magazine), Akademia (female magazine), S Toboi (female magazine), Arkhideia (high-tech magazine), Votre Beauté-Ukraina (female magazine).
Major Media Groups
Burda-UkraineBurda-Ukraine (created in 1997) - a subsidiary of Hubert Burda Media, a German-based worldwide publishing group. In Ukraine it owns 20 magazines, mostly thematic and oriented on female audience (Burda, Lisa, Girl, Oops!, Joy), male audience (Playboy Ukraine), car consumers (AvtoMir), family audience (Lisa. Moi Rebionok; Lisa. Moi Uiutnyi Dom), recreation (Otdokhni) or computers (Chip).
Edipresse UkraineEdipresse Ukraine – a Swiss-based publishing group Edipresse owns in Ukraine thematic magazines, mostly oriented on female audience: Edinstvennaia, VIVA!, VIVA! Biographia, Tvoi Malysh, Tvoie zdorovie, TV Ekran, Rukodelie, Yunaia Ledi, etc/
MEDIA CORRUPTION
• media haven’t transformed in purely business projects
• media protects the business and political interests of their owners, usually tycoons
• state-run media (communual) expressed the opinions of local or
central (eg. President’s) high-rank officials
• “jeansa” (both print and broadcasters) – paid media materials with no ad status mentioning
• non-observation of j-standards mostly in regions
IMPLICATIONS OF GLOBAL FINANCIAL CRISIS
It is a usual practice for commercial companies to cut the marketing budgets under the crisis conditions.
The main causes for the decrease in advertising revenues, which are the main sources of profits, are the decreases in:
• the real sector of the economy
• service sector of economy
• paying capacity of population
IMPLICATIONS OF GLOBAL FINANCIAL CRISIS
TV Channel І quarter of 2009 І quarter of 2008 Changes
1 Inter 54744,97 98922,36 -45%
2 «1+1» 35362,92 66033,24 -46%
3 STB 29893,68 33022,6 -9%
4 ICTV 26802,15 28971,44 -7%
5 Novyi 24017,47 28161,14 -15%
6 «Ukraina» 15716,88 18484,87 -15%
Revenues from TV advertising in the І quarter of 2009Revenues from TV advertising in the І quarter of 2009
IMPLICATIONS OF GLOBAL FINANCIAL CRISIS
The main advertisers of the newspapers are:
automotive industry ($20,1 million),
financial sector ($16,35 million),
real estate ($9,7 million).
The main advertisers of the magazines are:
motor transport ($49,2 million),
cosmetics ($31 million),
retail ($23,5 million).
BUT these are the very sectors of economy suffered the biggest meltdown at the end of 2008.
IMPLICATIONS OF GLOBAL FINANCIAL CRISIS
FlowFlow-o-out ut of foreign capitalof foreign capital
German Handelsblatt sold Economica Publishing House (business daily Delo, business weekly Investgazeta) to Viktor Pinchuk’s company.
Dutch Telegraaf Media Group (daily newspaper Obzor, magazines What’s on, Mayster, Domus Design, Liubimaya, etc) has announced to sell its Ukrainian editions at the end of 2008.
Free-of-charge editionsFree-of-charge editions
Free newspapers which existed due to the advertising are not issued any more
IMPLICATIONS OF GLOBAL FINANCIAL CRISIS: Prognosis
General volume of Ukraine’s advertising market is expected to be declined by 40-50%.
Radio – by 25%,
Television – by 20%,
Internet editions– by 20%.
Print press – possible decline to 1/3 of the market or by 35%.
It will be the first decline in the industry for the last ten years.
CURRENT STATE OF JOURNALISM EDUCATION IN UKRAINE
According the official data of the Ministry of Education and Science, there are 898 higher education institutions in Ukraine.
About 40 of them (4,5%) offer journalism higher education programs.
According with the recent World University Ranking-2008 research, held by QS company, none of the Ukrainian higher education institutions is ranked among top best 500 world universities
CURRENT STATE OF JOURNALISM EDUCATION IN UKRAINE: Main disadvantages
Priority is given to the theoretical knowledgePriority is given to the theoretical knowledge..
Educational system does not support the practical activity of the students of Journalist Departments, job and career centres are not functioning in the universities. System is not oriented on the individual needs of the students, does not accept the innovations
Faculty problems. Faculty problems.
The faculty is represented mostly by the old school, usually without the experience of journalist practice in modern conditions.
Monthly income of the most respectful professors is not higher that 500$/month.
CURRENT STATE OF JOURNALISM EDUCATION IN UKRAINE: Main disadvantages
Lack of financial resources of the universityLack of financial resources of the university.
The experience of one of the five universities analysed within the research - I.K. Karpenko-Kary Kyiv National University of Theater, Cinema, and Television, can serve as an indicator of the condition of state education financing. According to the dean of the Faculty of Cinema and TV, the annual budget of the university is 10 millions hryvnas (USD 2 millions), and the minimum amount needed for the proper functioning is 20-30 millions (USD 4-6 millions) annually.
CURRENT STATE OF JOURNALISM EDUCATION IN UKRAINE: Main disadvantages
Technical equipment and technology.Technical equipment and technology.
The existence in the Universities such communication tool as internet and e-mail can serve as an indirect characteristic of the educational approach. In the many educational institutions it is impossible to contact the either institution management, or professors via e-mail, as it is not indicated on the web-page. Moreover, not every office of university department management has a computer, despite it has been a while since computer technology became a necessary condition of the educational process.
ІNTERNEWS UKRAINEINTERNATIONAL NONGOVERNMENTAL ORGANIZATION
IUA Mission
Internews’ mission is establishment of European values through development of successful media in Ukraine:
• Professional• Politically neutral• Financially sustainable and transparent
Internews Ukraine seeks to: • Increase standards of journalism in Ukraine• Develop new media and citizen journalism• Improve technical capacities and financial sustainability of
local media• Improve legal frame with respect to media area• Strengthen intersectoral cooperation• Assist development of full-fledged democracy and civil
society
IUA establishment stages
1992
1993
1996
Nongovernmental organization “Internews Ukraine” is founded
Representative Office of Internews Network is opened in Ukraine
International Media Centre Internews is established
Reregistered as international nongovernmental organization “Internews Ukraine”
2003
IUA target groups
Internews Ukraine targets:
Journalists of national and local media
Technical staff of TV and radio companies
Top-management of TV and radio stations, print and online media outlets
Journalism students
Citizen journalists and civil activists
Local NGOs (Effective relations with media and PR)
State authorities and business companies (Effective relations with media and PR)
IUA activities
IUA holds:• Trainings / workshops / master classes• Round tables• Conferences / press-conferences• Information campaigns and awareness raising campaigns
IUA organizes:• Study tours• Field visits • Internships
IUA produces:• Video / audio products• Print media products
IUA provides:• Remote and onside media law consultations to local broadcasters
IUA partner organizations
International partners:International partners:
• Internews Europe (Paris, France)• European Journalism Centre (the Netherlands)• Institute for International Assistance and Solidarity (Brussels, Belgium)• Polska Fundacja im. Roberta Schumana (Warsaw, Poland)• Independent Journalism Center (Kishinev, Moldova)• IMPACT Media Agency (Kishinev, Moldova)• Internews Kazakhstan (Almaty, Kazakhstan)• Internews Azerbaijan (Baku, Azerbaijan)• Media Development Centre (Sofia, Bulgaria)• Local Informational Development Promotion Foundation (Belarus, Minsk)
IUA partner organizations
Local partners:Local partners:
• Democratic Initiatives Foundation
• Institute of Journalism of Kyiv National T. Shevchenko University
• Telekritika
• Center for Ukrainian Reform Education
• Ukrainian Razumkov Centre for Economic and Political Studies
• Europe ХХІ Foundation
• Ukrainian Center for Independent Political Research
IUA donor organizations
• Delegation of the European Commission to Ukraine
• Internews Network
• International Renaissance Foundation
• OSCE Project Coordinator in Ukraine
• British Council in Ukraine
• Council of Europe
• World Bank
• Royal Netherlands Embassy in Kyiv
• US Embassy in Kyiv
IUA donor organizations
• British Embassy in Kyiv
• Eurasia Foundation
• International Organization for Migration
• Institute for Sustainable Communities
• Open Society Institute
• UNDP
• World Health Organization
• Rinat Akhmetov Foundation “Development of Ukraine”
• Victor Pinchuk Foundation
• Eastern Europe Foundation/ Eurasia Foundation
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