#11
Transitions Online
www.tol.cz
October 17, 2001
Media Notes: Another One Bites the Dust
After Russian media tycoon Berezovsky's campaign against President Putin,
a recent court decision to liquidate his TV-6 network should come as no
surprise.
by Alexei Pankin
MOSCOW, Russia--“The oligarchs thought they were acquiring a sword, but found themselves with a guillotine that could easily chop off their heads.” That is how an expert commented on the development of relations within the "big business-media-government" triangle after Vladimir Putin was elected president. It is no secret that Russia's "oligarch" media were an element of crony capitalism--an instrument for servicing, sometimes blackmailing, the state to get preferential treatment for the oligarchs' businesses, and for eliminating competitors to the state coffers.
Those oligarchs, who did not realize that the rules had changed under Putin, had their heads chopped off. The first among them was Vladimir Gusinsky who lost his media empire to Gazprom, the gas giant that had previously been funding Media-MOST under orders from Yeltsin’s administration, after a protracted and spectacular battle with the state.
Another politically active oligarch and media magnate, Boris Berezovsky, was stripped of his main media asset, the primary national channel ORT--yet he managed to grow another head. The cream of the crop at Gusinsky’s NTV moved to TV-6, a network majority owned by Berezovsky.
But recently, the blade of the guillotine began its slide down again. On 27 September, the Moscow Arbitration Court, ruled in favor of the liquidation of TV-6, in a case brought by minority shareholder LUKoil-Garant. On 12 October, the court supplemented its decision by sharply restricting the management from performing financial operations--for instance from receiving new credits--effectively paralyzing the company’s activities. The decision was in line with the letter of the law, which allows the liquidation of companies whose liabilities exceed their equity capital, yet was clearly politically motivated. As one commentator put it, at least half of Russian businesses could be closed under that pretext.
Last summer, Berezovsky predicted that Putin would not survive until the end of his term as president. Moreover, he took active measures to make that prediction come true. He planned to form an opposition political party, and through grants to dozens of regional NGOs he is creating a local network. In autumn, a series of sensational exposes of secret services and alleged government plans to ban circulation of U.S. dollars in Russia ran in newspapers he either controls or has influence over. Friendly governors reportedly visit him on a regular basis in Paris. Media analyst Yelena Rykovtseva in early October wrote in Russia Journal that various sources-- from newspapers to anonymous experts--assessed his anti-Putin drive to cost more than $150 million.
On the other hand, Putin’s political position is rather precarious. He is a popular president pursuing potentially unpopular or divisive policies simultaneously on many fronts. His land reform--allowing private ownership of land--outraged the left-wing parties and their substantial electorate. His reforms of the communal sector have led to higher taxes for many people. The government’s problems with Chechnya have made it a no-win situation. Putin’s other risky domestic gamble is his full support for U.S. actions in the wake of the attacks on New York and Washington. That put him potentially at odds with broad segments of Russian establishment--not just the hard-liners.
His strength so far has been dependent on his personal popularity--and high oil prices continuing to support Russian economic growth. The administration realizes how quickly both could change, and how easily and skillfully Berezovsky’s propaganda machine can exploit any weakness that might emerge.
On his side, Berezovsky has to take into account Putin’s new international popularity connected with his pro-Western, anti-terrorist stance. At the end of September, Berezovsky gave a conciliatory interview to his influential newspaper Kommersant. But Putin's people know that Berezovsky is not to be believed under any circumstances. And no Russian statesman in his right mind would leave such a powerful weapon as TV-6--with staff who cut their teeth in the information wars of 1997-1999 and in resisting the state in the campaign against Media-MOST in 2000-2001--in the hands of such a formidable adversary.
Hence the new blow. Of course, TV-6 managers will appeal the decision of the Arbitration Court, but I believe the channel is doomed. And it was doomed from the moment its owner, Boris Berezovsky, declared an open war on the Putin administration. Journalists once again have become merely pawns in political games. Alexei Pankin is the editor of Sreda, a magazine for media professionals.
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