1. UKRAINE’S MEDIA FIELD: OVERVIEW Internews Ukraine

2. Ad Market in Ukraine

4. 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. -.

5. 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 - $289 Hungary - $219 Czech Republic - $141 Poland - $59 Ukraine - $40 -.

6. TV MARKET

7. 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.

8. TV MARKET: Major actors Rat% 18+ (50, 000 +) 20072008 Inter3,153,01 1+1 Studio2,281,72 STB11,15 ICTV0,971,12 Novyi kanal0,91,04 TRC Ukraina0,730, 83 NTN0,420,4 TET0,380,34 5 kanal0,30,24 First National0,290,28 Other TV1,51,72 Total TV14,2214,36 Ratings

9. 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

10. TV MARKET: Diversification Increasing 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 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.

11. 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: 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.

12. 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

13. 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.

14. 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.

15. Radio Market: Key players 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.

16. Radio Market: Foreign investment The market is attractive for foreign investors:Example: Communicorp Group, leading Irish commercial radio broadcaster, operated ”Nashe Radio" “Radio Apelsin” (now – “NRJ” Radio)

17. 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.

18. 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 

19. 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;

20. 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).

21. 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

22. PRINT MEDIA: Diversification Business 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 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 editions city-guides, travel guides, etc. Gender oriented editions female and male magazines

23. 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).

24. 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%).

25. 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

26. Online / Digital Publishing: New trends convergence and multimedia development blogging citizen journalism on-line communities

27. Major Media Groups Central European Media Enterprises (CME) Central European Media Enterprises (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.

28. Major Media Groups U.A. Inter Media Group Ltd U.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.

29. Major Media Groups Ukrainian Media Holding Ukrainian 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.

30. Major Media Groups Glavred Media Holding Glavred 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.

31. Major Media Groups Victor Pinchuk’s media group Victor 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).

32. Major Media Groups System Capital Management (SCM) System Capital Management (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.

33. Major Media Groups Ukrainian industrial and investment concern Ukrainian 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.

34. Major Media Groups KP Media KP 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.

35. 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 Media Karavan 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).

36. Major Media Groups Burda-Ukraine Burda-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 Ukraine Edipresse 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/

37. 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

38. 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

39. IMPLICATIONS OF GLOBAL FINANCIAL CRISIS TV ChannelІ quarter of 2009І quarter of 2008Changes 1 Inter 54744,9798922,36-45% 2 «1+1» 35362,9266033,24-46% 3 STB 29893,6833022,6-9% 4 ICTV 26802,1528971,44-7% 5 Novyi 24017,4728161,14-15% 6 «Ukraina» 15716,8818484,87-15% Revenues from TV advertising in the І quarter of 2009

40. 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.

41. IMPLICATIONS OF GLOBAL FINANCIAL CRISIS Flow-out of 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 editions Free newspapers which existed due to the advertising are not issued any more

42. 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.

43. 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

44. CURRENT STATE OF JOURNALISM EDUCATION IN UKRAINE: Main disadvantages Priority 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. 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.

45. CURRENT STATE OF JOURNALISM EDUCATION IN UKRAINE: Main disadvantages Lack of financial resources of the university Lack 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.

46. CURRENT STATE OF JOURNALISM EDUCATION IN UKRAINE: Main disadvantages 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.

47. ІNTERNEWS UKRAINE INTERNATIONAL NONGOVERNMENTAL ORGANIZATION

48. 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

49. 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

50. 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)

51. 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

52. IUA partner organizations 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)

53. IUA partner organizations 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

54. 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

55. 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

56. 04112, Ukraine, Kyiv, Ryz’ka St., 15 Tel./fax:(+380 44) 458-44-40 E-mail: akulakov@internews.ua URL: www.internews.ua We are open for cooperation

57. Thanks for your attention!