Private networks welcome competition from TVRI<\/p>\n
JAKARTA (JP): Indonesia's five current private television
\nstations say they welcome greater competition from TVRI, which
\nwill soon be revamped, but warned against allowing the state-
\nowned network to run advertisements.<\/p>\n
Executives of the five commercial networks said a restructured
\nTVRI would be welcomed as it would stimulate more competition in
\nthe TV industry to provide better programming for viewers.<\/p>\n
The executives expressed their views during a joint hearing
\nwith the Commission I of the House of Representatives on
\nWednesday.<\/p>\n
Taking part were M.S. Rallie Siregar, president of RCTI,
\nSlamet Supojo of SCTV, Abdullah Alatas Fahmi of TPI, Agung
\nLaksono of ANteve and Angki Handoko, the president of Indosiar, a
\nnew network which plans to go on air beginning in January.<\/p>\n
"The restructuring of TVRI will encourage fairer competition
\namong television stations," Rallie said at the hearing.<\/p>\n
The TV executives however warned that allowing TVRI to run
\ncommercials to generate revenue could be a catastrophe for the
\nmedia industry as a whole.<\/p>\n
Total advertising spending in Indonesia averages approximately
\nRp 1.2 trillion ($570 million) a year, which is divided among
\ntelevision, newspapers and magazines.<\/p>\n
"It would be terrible if TVRI were also allowed to compete for
\na slice of the cake," Agung Laksono said.<\/p>\n
The government has announced its plan to turn TVRI, now a
\nstate agency under the Ministry of Information, into a
\ncorporation, managed along corporate lines. The move is expected
\nto make the management of the network more professional.<\/p>\n
There are debates within and outside the government about
\nwhether or not TVRI should be allowed to tap advertising
\nrevenues. The network stopped airing advertisements in the late
\n1970s after being criticized for encouraging consumerism among
\npoor people.<\/p>\n
TVRI has since been financed entirely by television license
\nfees and, with the arrival of private television five years ago,
\nit has also been receiving royalties from the private stations.<\/p>\n
"TVRI does not need to run commercials because the royalties
\nwe pay should be sufficient to finance its operation," Agung
\nLaksono said.<\/p>\n
Revenues<\/p>\n
Siregar said each private station pays 12.5 percent of its
\nannual revenues as a royalty to TVRI.<\/p>\n
RCTI last year paid Rp 20 billion in royalties to TVRI, SCTV
\nRp 8 billion and TPI Rp 12 million. Anteve will only begin paying
\nroyalties this year while Indosiar will follow suit in 1995.<\/p>\n
Legislator Sophan Sophiaan has estimated that TVRI will bring
\nin Rp 180 billion in revenues this year. The vast majority is
\ngenerated from TV licensing fees with 5.8 percent coming from
\nprivate stations, he added.<\/p>\n
TVRI is by far the oldest network and has far greater reach
\nthroughout the archipelago, a definite edge were they to seek
\nadvertising receipts.<\/p>\n
The new private stations, by comparison, are only received in
\nIndonesia's bigger cities. They have sought to make up for lost
\nground by offering better programs, knowing that TVRI's hands are
\nbound given its status as a state agency.<\/p>\n
The aggressive programming by the private networks however has
\ndrawn strong criticism from some members of the public who said
\nthat the Hollywood action pictures, kung-fu films and Hispanic
\ntelenovelas now being shown on television screens are undermining
\ntraditional local values.<\/p>\n
Responding to this allegation, the five executives at the
\nHouse hearing yesterday said that they are aiming to increase the
\nlocal content in total programming from an average of 30 percent
\nto 70 percent. (imn)<\/p>",
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