Image blurs on future of TV stations

Tomorrow, the nation's television industry celebrates its 36th anniversary in a glum mood, due to an unabated economic crisis. The Jakarta Post team of Ahmad Junaidi, Edith Hartanto, Sylvia Gratia M. Nirang, Kornelius Purba, Kosasih Deradjat and Dwi Atmanta, and contributor Antariksawan Jusuf, look at the issue.

JAKARTA (JP): The national television industry will receive a bitter birthday present this year, and an unsettled economic crisis is the only thing to blame.

Financial woes mark the darkest time for the country's 36-year-old television industry, which saw new channels booming in the past decade.

Since the advent of Rajawali Citra Televisi Indonesia (RCTI) nine years ago, four other stations shot into orbit. Surya Citra Televisi (SCTV) was launched in 1990, followed by Televisi Pendidikan Indonesia (TPI) in 1991, ANteve in 1992 and Indosiar in 1995.

Both RCTI and SCTV, which moved its head office from Surabaya to Jakarta in 1993, are under holding company PT Datacom Asia.

The state television channel Televisi Republik Indonesia (TVRI) was launched on Aug. 23, 1962, now recognized as National Television Day. The first two private stations also celebrate their anniversaries on this date.

Except for TVRI, which is relatively safe, all five private stations have been adopting drastic money and energy saving policies due to a substantial drop in advertisement revenue -- the broadcast industry's lifeline.

Various radical measures can easily be seen, from the reduced hours of each station's airtime to the increasing hours of reruns.

Indosiar, for example, has cut the daily airtime from 18 hours to 11 hours, except on weekends. With one hour of airtime costing about Rp 15 million, the station hopes to save Rp 105 million daily, according to the station spokesman Andreas Ambessa.

During these bad times, the private stations can barely haul themselves into a profit-making position. As RCTI spokesman Eduard Depari put it, just to survive the uncertainties is what local broadcast companies are hoping for.

"Forget ratings or profit seeking this time around. We, RCTI, are simply trying to make sure we can broadcast our programs everyday," he said.

SCTV's Budi Darmawan said the station has seen its income from ads drop by 70 percent since the financial crisis swept across Southeast Asia in July last year. And it is as if it has reached a point of no return.

The spotlight was turned onto SCTV recently when it carried out massive layoffs. Budi said 100 out of the station's 1,200 employees have asked for early retirement.

"There is no better solution for our troubled cash flow than trimming staff numbers. We are offering those who are willing to resign a considerable amount of severance pay. Up to 12 times their monthly salary," Budi said.

"It's sad ... but it will be worse for all of us if the staff slash does not happen," he added.

Budi said reducing airtime was worthwhile because an hour of broadcasting cost SCTV an average Rp 20 million (US$1,700). The station broadcasts 17 hours a day, three hours less than its usual times.

Like other stations, SCTV has stopped importing foreign programs, which, according to Budi, now cost triple their old price. Selected local products and reruns have replaced the imported programs.

He said a rerun allowed the station to save from Rp 12 million to Rp 15 million.

But despite the crisis, private stations refuse to sacrifice their regular live broadcasts of European soccer leagues, saying they stake their pride on these weekend programs.

RCTI is continuing with its Italian league coverage; SCTV with the English premiership broadcast every Saturday; ANteve turns to Spanish league; and Indosiar takes Sunday's English league matches.

Budi said the decision to continue with the soccer agenda was a difficult but unavoidable choice.

"... But we took it because it deals with our image," he said, adding that SCTV would maintain live coverage of the NBA finals.

How long can the floundering television industry stand the financial crunch?

Depari said RCTI, the country's largest station, would remain safe until December and would still take a brave stand for at least another six months if the situation worsened.

"If a big company estimates its endurance for that short a time, how about smaller ones?" he asked.

Budi said SCTV had anticipated such a gray future, although he expressed guarded optimism that such an assessment would be wrong.

"In an extreme situation, we may only broadcast our favorite news program Liputan 6, or dismiss employees who show poor records," Budi said.

Mass communication expert M. Budyatna questioned the government's slow response to the looming crisis that threatens the existence of the national television industry.

"Foreign investment is the medicine for the ailing television industry. The government should lift regulations which ban foreign investments in the media industry because they are not in line with this globalization era," said Budyatna, who is from the University of Indonesia.

But the director general of radio, television and film, Ishadi SK, defended the government's sloppy move, saying that it had listed other priority sectors which needed immediate help.

"The television industry is not as crucial as banks in regard to a direct affect on the public," he said.

"If we analogize them with the human body, a bank is the heart and televisions are the feet and arms. No one can live without a heart but you can survive without a foot or an arm."

He said that if private television stations collapsed, the government could still rely on TVRI.

But, he said, the government has not turned a blind eye to the private stations' growing difficulties.

"We are working on a review of the broadcast law in response to the escalating financial crisis. It will accommodate demands for sweeping reforms in our mass media," Ishadi said.

He said that under the new law, the government would allow foreign investment of up to 25 percent of the initial capital. He refused to go into details, saying the drawing up of the bill was underway.

"We hope we can submit it to the House of Representatives by the end of the year," he said. (team)