Hungarian Heritage Review, 1991 (20. évfolyam, 1-11. szám)
1991-01-01 / 1. szám
Dateline: Budapest Heavily Privatized, Hungarian Press Is Disliked by Government, Which Complains of Bias The Hungarian press has become the most privatized of all business sectors in the country and has the highest share of Western capital investment, yet it is facing a number of difficulties, including an attempt by the current government to pass a law requiring the national media to be "impartial" and "objective". The current government, led by the Democratic Forum, has often accused the press of antigovernment bias and complained that media employees who served the former communist regime are still in place and still shaping public opinion. Most of Hungary's 32 dailies have served ties with the communist organizations that owned them and have converted their publishing houses into joint-stock companies. The conversions were dictated by the need for a qualitative improvement and for capital investment to modernize antiquated printing plants. Since only foreign investors could provide the capital, Hungarian publications have readily accepted their participation and predominance as investors. Western investment currently amounts to 79 percent of the total capital assets of the Hungarian press. As a rule, the editorial staffs retain only a small number of shares in the investing firms, but they have obtained guarantees of non-interference in editorial policy from the major shareholders. Most Western investors have come from Germany or England. Earlier this year, the British press magnate Robert Maxwell bought up 40 percent of the stock of the country-wide daily Magyar Hirlap; in August, Maxwell went on to acquire 40 percent ownership of the evening daily Esti Hirlap, which is owned by the Hungarian Socialist Workers' Party (the former communist party). Last spring a US company, the Central European Development Corporation, administered by former US Ambassador to Hungary Mark Palmer, bought up 49 percent of the stock of the popular weekly Szabad Fold, and in August the West German publishing firm Bertelsmann acquired 41 percent of the stock of the HSP daily Nepszabadsag. The only case of an outright foreign takeover thus far involves seven of the nineteen county dailies owned by the HPS, which were bought by the West German publisher Axel Springer in April of this year. Taking advantage of legal loopholes, Springer took over the dailies without paying any financial compensation by simply persuading the dailies' editorial staff to work for him and continuing to publish the old dailies under new names. All the major political parties protested the manner in which Springer carried out the takeover and expressed reservations about the fact that the major source of local information in the counties affected by the takeover had passed into foreign hands. The "Springer scandel” led to the establishment of an ad hoc parliamentary committee made up of deputies of the six political parties represented in the parliament. The committee was given the task of investigating the privatization and the purchase of the media by foreign investors. The publishing houses of the HSP's remaining 12 dailies were converted into joint-stock companies under the supervision of this committee, and restrictions were imposed on the sale of shares to foreign investors to prevent the formation of monopolies. Following that action, the affected provincial dailies sold between 10 percent and 49 percent of their stock to various foreign buyers, including one British, eight Austrian, and two West German firms. One provincial daily sold all its shares to Hungarian firms. Another controversial case of privatization and foreign acquisition of a newspaper involves the Patriotic People,s Front daily Magyar Nemzet. The government blocked a transaction last July supported by the majority of the daily's staff to set up a joint-stock company and sell a major part of its stock to the Swedish liberal daily Dagens Nyheter. The government stated its preference for the conservative French press firm of Robert Hersant. Ignoring the protest of the news staff, Magyar Nemzet's state-owned publishing house went ahead and signed a contract with Hersant. The case is now pending in the courts. This year has seen a further drop in the number of copies printed of most newspapers and journals. The main reason for this is the greatly increased costs of newsprint, which has forced all publishers to raise their sale prices. The 30 percent increase in the price of newsprint on Oct. 1 caused a wave of protest among publishers. The Association of Hungarian Newspaper Publishers declared that the price hikes would force most newspaper publishers into "bankruptcy" and called on the government to help publishers through tax cuts and loans. The press has aslo been affected by an antiquated press distribution system. The press distribution system is in a precarious state because the proliferation of independent publications has not been accompanied by a commensurate expansion of the distribution network. The number of newspaper and —continued next page 10 HUNGARIAN HERITAGE REVIEW JANUARY 1991
