"Market development is made more difficult"
Belcom CEO Andreas Meili explains why two provisions of the RTVG led to his resignation from the VSP.
Belcom CEO Andreas Meili explains why two paragraphs of the RTVA led to his withdrawal from the VSP.WW City Pool radio stations do not agree with articles 54.3 and 55.2 of the RTVA (see box) - in contrast to the other members of the VSP.
members of the Swiss Private Radio Association. But why did you leave the VSP straight away?
Andreas Meili: The articles contain key provisions from the point of view of publisher radio stations: According to 55.2, media houses active in multimedia must expect that they will no longer be able to operate licensed radio or TV in the future. And those that do receive a license may own a maximum of two stations according to 54.3. This is an arbitrary limit because it is not based on actual market shares, but on a purely numerical criterion. This makes it more difficult for the market to develop. We are also of the opinion that the support of a large media company can enhance the quality of a channel and thus have a positive effect on the diversity of opinions and offerings. And that no further market restrictions are needed in addition to the new, more effective Cartel Act. In these matters, which are very fundamental for us, we do not feel represented by the VSP.
Do you expect other publisher radio stations such as Basel 1, BE1, Munot, Grischa or 32 to leave?
I assume that they are thinking along similar lines to the city pool radios.
Are you actively trying to attract more publisher radio stations to your side?
There are contacts between them.
Will you set up a second association?
We would certainly like to bundle our positions, but the organizational form is still open. It is also possible that we could become involved in the publishers' association.
This is probably the right place for your concern, as the two articles primarily concern publishers' interests. Why do you mix these with the actual radio interests in the VSP?
Especially in political decision-making, it is not always possible to distinguish between the two. And with our withdrawal, we wanted to reveal this fundamental difference of opinion. In other areas, however, such as radio research or VHF frequencies, we are of the same opinion as the VSP. We will continue to work together on these issues.
I interpret her resignation as a renewed commitment that Tamedia wants to expand its radio and TV chains.
I have to correct that: We are not in the process of forming chains. We own Radios 24 and Basilisk and have a minority stake in ExtraBern via the Berner Zeitung (BZ). And we work together in the City Pool, where we feel comfortable, as well as in the Swiss Radio Pool. Operationally, however, only two stations are under my responsibility. My primary concern is to offer the market sensible forms of advertising - and I believe that we are doing this. However, if opportunities arise, which must always allow for sensible advertising and programming combinations, we also want to be able to participate in other stations. We would like the law to allow this. Everyone, including foreigners, should be able to grow if the market offers this. But it is not the case that we are on a shopping spree.
And in the TV sector?
We own TeleZüri and also hold a minority stake in TeleBärn via BZ. In addition, we cooperate in TeleNewsCombi (TNC). This can still grow. But here, too, we have no intention of acquiring a stake in other stations. We want to make TeleZüri a success first. The main goal there is to break even, which would take us a big step further.
A second, much bigger problem is recouping the investment of around CHF 115 million for Belcom and Basilisk. You have your back to the wall.
The fact is that we paid a hefty price for the two investments. What's more, 2002 and 2003 were particularly weak years in economic terms. But we are very satisfied with Basilisk and 24, both of which are among the most profitable stations in Switzerland.
But they are never so profitable that the large investments can be repaid within ten years.
We have made two value adjustments at Belcom and Basilisk, partly due to the weak economy.
Nevertheless, around 80 million francs remain. Are further value adjustments imminent? No, I don't think so.
By when and how do you want to achieve the return on investment?
We do not provide any information about our calculation models and strategies. However, it should not be forgotten that Tamedia has not only acquired two very successful radio stations, but also the associated sales companies, a successful TV station in the form of TeleZüri and a property in Zurich and Basel.
Once again on possible acquisitions: In Bern, Tamedia is reportedly waiting until Charles von Graffenried, Chairman of the Board of Directors of Espace Media, retires. This could offer the opportunity to create new majority structures at BZ, ExtraBern and TeleBärn.
No, we do not make such considerations. We are asking ourselves how we can operate our radios and TeleZüri most successfully. In this context, we also want to keep our investment options open. But we are not speculating on the resignation of Mr. von Graffenried.
There are several TV stations that have their doors more or less open, such as TeleOstschweiz or NordWest 5 (NW 5). Is NW 5 not an option for
Tamedia?
We have no intention of getting involved there. However, a larger concession area would certainly be important for NW 5 itself, and I would welcome this. After all, competition is good for a monopolized media market like Basel. What's more, the City of Basel's negative opinion on the NW 5 expansion application has protectionist overtones. I am very curious to see how the Federal Office of Communications and the Federal Council will react to this.
NW-5 Managing Director Beat Alder does not seem to need your help.
have. He can acquire advertising. According to his figures, he earned CHF 68,000,000 in advertising and sponsorship income in 2003, almost as much as Tele Basel, for which your Basel sales company Medag acquired a portion. For 2004, Alder is even expecting 2 million francs.
I don't know whether these figures are correct. Marketing Tele Basel was difficult. Regional TV did not have the same acceptance two years ago as it does today. And the connection to TNC will pay off even more for Tele Basel in the future.
But aren't you annoyed that Alder is showing you up like this with NW 5? With
With just 25 municipalities - excluding the city of Basel - and without TNC membership, it brings together more than Medag.
If he actually manages to do that, I can only congratulate him. He may have a lot of goodwill in his region. But whether a station can be financed on this basis in the long term is very questionable. In the end, normal performance figures such as reach or GRP will be decisive. That is why Mr. Alder remains dependent on a larger broadcasting area.
About Tele Basel: Until his death in February, Basilisk co-founder Hans-Ruedi Ledermann was a member of the committee of the cable network foundation. This meant that Tamedia was also represented on the board of Tele Basel. Would you like to continue to sit on it?
If it makes sense for Tele Basel. We have not yet received a request, but would certainly consider one.
Are you not taking action yourself?
The political side of Tele Basel is not uninteresting for us, but it is not the main focus. I favor cooperation in the commercial sector. For example, Radio Basilisk and Tele Basel will cooperate on the FC Basel championship celebrations.
The bone of contentionThe controversial paragraphs of the RTVA, as passed by the National Council as the first chamber
Art. 54.3: A broadcaster or the company which owns it may acquire a maximum of two television licences and two radio licences. Art. 55.2: If several applications are received in the invitation to tender for a license, preference shall be given to the applicant who is best able to fulfil the performance mandate. If several applications are largely equivalent from this point of view, preference shall be given to the applicant who is least dependent on other broadcasters and other media companies.
Paragraph dispute: Andreas Meili, Head of Electronic Media at Tamedia.
Interview: Markus Knöpfli
members of the Swiss Private Radio Association. But why did you leave the VSP straight away?
Andreas Meili: The articles contain key provisions from the point of view of publisher radio stations: According to 55.2, media houses active in multimedia must expect that they will no longer be able to operate licensed radio or TV in the future. And those that do receive a license may own a maximum of two stations according to 54.3. This is an arbitrary limit because it is not based on actual market shares, but on a purely numerical criterion. This makes it more difficult for the market to develop. We are also of the opinion that the support of a large media company can enhance the quality of a channel and thus have a positive effect on the diversity of opinions and offerings. And that no further market restrictions are needed in addition to the new, more effective Cartel Act. In these matters, which are very fundamental for us, we do not feel represented by the VSP.
Do you expect other publisher radio stations such as Basel 1, BE1, Munot, Grischa or 32 to leave?
I assume that they are thinking along similar lines to the city pool radios.
Are you actively trying to attract more publisher radio stations to your side?
There are contacts between them.
Will you set up a second association?
We would certainly like to bundle our positions, but the organizational form is still open. It is also possible that we could become involved in the publishers' association.
This is probably the right place for your concern, as the two articles primarily concern publishers' interests. Why do you mix these with the actual radio interests in the VSP?
Especially in political decision-making, it is not always possible to distinguish between the two. And with our withdrawal, we wanted to reveal this fundamental difference of opinion. In other areas, however, such as radio research or VHF frequencies, we are of the same opinion as the VSP. We will continue to work together on these issues.
I interpret her resignation as a renewed commitment that Tamedia wants to expand its radio and TV chains.
I have to correct that: We are not in the process of forming chains. We own Radios 24 and Basilisk and have a minority stake in ExtraBern via the Berner Zeitung (BZ). And we work together in the City Pool, where we feel comfortable, as well as in the Swiss Radio Pool. Operationally, however, only two stations are under my responsibility. My primary concern is to offer the market sensible forms of advertising - and I believe that we are doing this. However, if opportunities arise, which must always allow for sensible advertising and programming combinations, we also want to be able to participate in other stations. We would like the law to allow this. Everyone, including foreigners, should be able to grow if the market offers this. But it is not the case that we are on a shopping spree.
And in the TV sector?
We own TeleZüri and also hold a minority stake in TeleBärn via BZ. In addition, we cooperate in TeleNewsCombi (TNC). This can still grow. But here, too, we have no intention of acquiring a stake in other stations. We want to make TeleZüri a success first. The main goal there is to break even, which would take us a big step further.
A second, much bigger problem is recouping the investment of around CHF 115 million for Belcom and Basilisk. You have your back to the wall.
The fact is that we paid a hefty price for the two investments. What's more, 2002 and 2003 were particularly weak years in economic terms. But we are very satisfied with Basilisk and 24, both of which are among the most profitable stations in Switzerland.
But they are never so profitable that the large investments can be repaid within ten years.
We have made two value adjustments at Belcom and Basilisk, partly due to the weak economy.
Nevertheless, around 80 million francs remain. Are further value adjustments imminent? No, I don't think so.
By when and how do you want to achieve the return on investment?
We do not provide any information about our calculation models and strategies. However, it should not be forgotten that Tamedia has not only acquired two very successful radio stations, but also the associated sales companies, a successful TV station in the form of TeleZüri and a property in Zurich and Basel.
Once again on possible acquisitions: In Bern, Tamedia is reportedly waiting until Charles von Graffenried, Chairman of the Board of Directors of Espace Media, retires. This could offer the opportunity to create new majority structures at BZ, ExtraBern and TeleBärn.
No, we do not make such considerations. We are asking ourselves how we can operate our radios and TeleZüri most successfully. In this context, we also want to keep our investment options open. But we are not speculating on the resignation of Mr. von Graffenried.
There are several TV stations that have their doors more or less open, such as TeleOstschweiz or NordWest 5 (NW 5). Is NW 5 not an option for
Tamedia?
We have no intention of getting involved there. However, a larger concession area would certainly be important for NW 5 itself, and I would welcome this. After all, competition is good for a monopolized media market like Basel. What's more, the City of Basel's negative opinion on the NW 5 expansion application has protectionist overtones. I am very curious to see how the Federal Office of Communications and the Federal Council will react to this.
NW-5 Managing Director Beat Alder does not seem to need your help.
have. He can acquire advertising. According to his figures, he earned CHF 68,000,000 in advertising and sponsorship income in 2003, almost as much as Tele Basel, for which your Basel sales company Medag acquired a portion. For 2004, Alder is even expecting 2 million francs.
I don't know whether these figures are correct. Marketing Tele Basel was difficult. Regional TV did not have the same acceptance two years ago as it does today. And the connection to TNC will pay off even more for Tele Basel in the future.
But aren't you annoyed that Alder is showing you up like this with NW 5? With
With just 25 municipalities - excluding the city of Basel - and without TNC membership, it brings together more than Medag.
If he actually manages to do that, I can only congratulate him. He may have a lot of goodwill in his region. But whether a station can be financed on this basis in the long term is very questionable. In the end, normal performance figures such as reach or GRP will be decisive. That is why Mr. Alder remains dependent on a larger broadcasting area.
About Tele Basel: Until his death in February, Basilisk co-founder Hans-Ruedi Ledermann was a member of the committee of the cable network foundation. This meant that Tamedia was also represented on the board of Tele Basel. Would you like to continue to sit on it?
If it makes sense for Tele Basel. We have not yet received a request, but would certainly consider one.
Are you not taking action yourself?
The political side of Tele Basel is not uninteresting for us, but it is not the main focus. I favor cooperation in the commercial sector. For example, Radio Basilisk and Tele Basel will cooperate on the FC Basel championship celebrations.
The bone of contentionThe controversial paragraphs of the RTVA, as passed by the National Council as the first chamber
Art. 54.3: A broadcaster or the company which owns it may acquire a maximum of two television licences and two radio licences. Art. 55.2: If several applications are received in the invitation to tender for a license, preference shall be given to the applicant who is best able to fulfil the performance mandate. If several applications are largely equivalent from this point of view, preference shall be given to the applicant who is least dependent on other broadcasters and other media companies.
Paragraph dispute: Andreas Meili, Head of Electronic Media at Tamedia.
Interview: Markus Knöpfli
