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History of the first 15 years of the Media Development Loan Fund

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Page 1: MDLF First Fifteen Years

mdlf media development loan fund first fifteen years

Cover Mechanical 2.indd 1 4/13/10 6:22:25 PM

Page 2: MDLF First Fifteen Years
Page 3: MDLF First Fifteen Years

mdlf media development loan fund first fifteen years

Page 4: MDLF First Fifteen Years
Page 5: MDLF First Fifteen Years

mdlfmedia development loan fund first fifteen years

Page 6: MDLF First Fifteen Years

Copyright © April, 2010 by

Media Development Loan Fund, Inc.

All rights reserved. No part of this book may be reproduced or transmitted in any form or by any means,

electronic or mechanical, including photocopying, recording, or by any information storage and retrieval

system without the permission of Media Development Loan Fund, Inc.

Page 7: MDLF First Fifteen Years

Art provIDeD by:

Ap Images

book DesIgN:

tronvig group

Media Development Loan Fund, Inc.

www.mdlf.org

New york

37 West 20th street, suite 801

New york, Ny 10011, UsA

phone 1.212.807.1304

prague

salvatorska 10

110 00 prague 1, Czech republic

phone 420.224.312.832

Page 8: MDLF First Fifteen Years

tAbL

e o

F Co

Nte

Nts

Page 9: MDLF First Fifteen Years

INtroDUCtIoN the big bang theory of MDLF by saša vucinic 08

tIMeLINe 1995 10

1996 12

1997 14

1998 18

1999 20

2000 22

2001 28

2002 30

2003 32

2004 38

2005 40

2006 42

2007 46

2008 48

2009 50

2010 52

essAys social contracts, loan contracts, and integrity by endre bojtar 16

building a financial theology out of dignity & freedom by José rubén Zamora 24

How will we fund the Fourth estate? by bernard poulet 34

Is the Internet a threat to journalism? by steven gan 44

CeNter For ADvANCeD MeDIA prAgUe Find a way or make one 54

INDoNesIAN rADIo ending the isolation by santoso 56

peopLe 60

INvestors & CoNtrIbUtors 62

boArD oF DIreCtors 63

oFFICes 64

Page 10: MDLF First Fifteen Years

MDLF was blessed with a wonderful big bang: At two meetings held

over a period of nine months, george soros refused to fund the project

code-named “media bank.” At the end of a third meeting, on the

beautiful morning of May 1, 1995, on a bench in the only park of the

provincial town of presov, in slovakia, he finally agreed to take the risk

(more to his reputation than to his funds). “It is not going to work,” he

told me. “but I will give you a rope to hang yourself. My foundation will

invest the first $500,000 to test the idea.” With those words, what later

became MDLF was given life.

Later, I called stuart Auerbach, a longtime Washington post reporter and

my partner in crime in the imagining of the media development bank.

“Houston, we have a problem,” I said. “gs agreed to fund the project

with half a million. there is no way back now.”

“Now that we are in business, we first have to buy you a pin-striped

suit,” stu roared with delight. “you can’t possibly be a banker

without one.” so, this is MDLF’s “big bang” story. this is how the

adventure started.

the first meeting with lawyers brought the end to the idea of having

the word “bank” in the name of the new organization. “too much

regulation,” we were told. “replace it with the word ‘fund.’ ”

Fine. the words “media” and “development” made it to the name

unopposed. to leave no doubt about what will be our “core business,”

we added the word “loan” to this mix. voila: Media Development

Loan Fund. that’s how we arrived at, as one branding expert told me

a decade and a half later, probably the dullest and most uninspiring

name ever given to a functioning organization.

but I have to admit, in mid-1995 we did not think about the name for

more than several minutes. the kind of name to give your dream did not

appear to be important at all. the dream itself was the only important

thing – to create a media development bank. to our surprise, nothing of

that kind existed, although it was obvious to us that it was badly needed.

the countries of eastern and Central europe were in the midst of incred-

ibly painful transitions, shaking off the leftovers of authoritarian pasts,

while yugoslavia was convulsing in bloody civil war. Media was playing

a main supporting role in all events in the region. In some countries the

media’s role was disgraceful and horrific, in others brave and honorable.

In most of the countries it was a mixed bag. but it was beyond dispute

that for the first time in the history of this region, a philosophy, a move-

ment, a process that could be defined as “independent media” emerged.

And it badly needed help to take root. It badly needed all kinds of assis-

tance, but above all, we thought, affordable and “no-strings attached”

financing, to level the playing field and allow it to compete with its

“dependent competitors” in order to survive. Could there be a more

obvious solution to this problem than a media development bank?

Now I know why it looked so simple to us fifteen years ago – we had

no idea how huge a goal we were aiming to achieve. our first miscon-

ception was in thinking that we should build an institution of a rigidly

financial nature. No grants, no “assistance mentality,” no handouts.

We should deliberately insist on a pure businesslike approach, and stick

only to the business of lending money to independent media companies.

Fifteen years, a hundred million dollars, and more than two hundred

projects later, we know better. yes, we do lend money, but that is

the big bang theory of MDLF

INtr

oDU

CtIo

N08

buried in the depth of every organization’s institutional memory, a founding legend –

a treasured story explaining the organization’s “big bang” – can always be unearthed.

Page 11: MDLF First Fifteen Years

certainly not the only thing we do. today we know that the most

important thing we do – which is not at all so obvious – is facilitate

the transfer of highly specialized knowledge about managing media

to our clients. the low-cost financing that we provide is by itself not

enough. It is the media expertise we attach to it that makes all the

difference. It’s not the money; it is the wrapper in which the money

comes that makes the package so effective.

We started to build a rigidly focused bank, but over time we ended up

creating a not-for-profit mix between a venture capital and revolving

loan fund, with an “added value activity” of knowledge transfer.

How and why did that change happen? Well, you may get an idea of the

answer if you take a look into the pages that follow. they aim to provide

a time-travel review of the past fifteen years of MDLF’s existence.

these were turbulent and eventful years for the parts of the world in

which we work. Countries were liberated or disappeared, wars were

fought. elections were won, lost, or stolen. Democracy had its good

days, but also periods of retreat. epidemics and pandemics erupted and

disappeared. the world went through the currency crisis of 1997 in Asia,

the ruble collapse, and, a decade later, the global financial meltdown.

In the field of media, the changes could not have been more dramatic.

From the birth of the Internet, the first websites, and new media to the

founding of google, youtube, and the launching of the ipad, the media

industry was spinning out of control. known business models collapsed in

front of the eyes (or should I say eyeballs) of new “electronic audiences.”

swimming in this sea of change, the only way to keep MDLF relevant

was to constantly rethink it, change it, adapt it, and fine-tune it.

MDLF began each one of its fifteen years slightly modified, retooled;

and different.

but there was one thing that did not change during those fifteen

years – our understanding of who our clients are, and the basis of

our relationship with them.

We understand that we are in the business of giving a chance to

those dedicated, smart, and independent people whose mission in

life is to make their part of the world a better place through providing

their communities with unfiltered, fact-based, independent, and

professionally produced information. they are providing a space

in which different voices can participate in discussions and set the

social agenda; providing voters with meaningful information; and

giving voice to those who otherwise would be voiceless. We provide

financing for their dreams and ambitions. We invest in their voices.

Hence, the most important legacy of our work – I think – is the

creation of an amazing network of clients: an incredible collection

of independent media companies, over eighty at this moment, and

the people working for them. All of them are striving to be fiercely

independent, striving to conduct their media business by adhering to

the highest standards of professionalism and led by a mission to

serve their communities instead of simply to maximize profits.

the whole purpose of MDLF’s existence is to be the institution of

financial support and knowledge support for this network, and to

help the network expand.

great idea, great vision, great mission, great clients, great execution –

it does not really matter how many great things one can line up together

in one project. All of that greatness is absolutely meaningless unless

one manages to attract a group of smart, creative, and commited

people who will adopt the idea and give life to the organization: make

it tick, load it with different ideas and new ways of thinking, make it

diversified with different types of mindsets, creativity, and approaches.

MDLF has been incredibly lucky in this respect.

very early on, an amazing group of people got together to build MDLF.

some of them served as staff, some served on our board, and some

were just friends who were helping the idea and the organization from

a distance. It is impossible to name them all, but it is possible, we

thought, to give them a chance to share a smile from the pages of this

publication (see pages 60–61).

I am not going to lie and say it was easy for us to bring MDLF to where

it is now: our businesslike philosophy to media assistance recognized;

our investment approach proven to obtain outstanding results; and our

own business model allowing us not only to reach self-sustainability

three years ago but also to create a sizable “quasi-endowment” to

subsidize future projects. the truth is that we’ve also seen our fair

share of arguments and resignations, tears and self-doubt, impatience

and disbelief. to illustrate that point: for our fifth anniversary, we

made t-shirts that read “our biggest achievement so far is that we are

still in business.”

I close the circle by bringing this story back to its beginning – to the

man without whom MDLF could not have happened. george soros

put a bit of his funds and a lot of his reputation at risk backing up

a project that he thought would fail. by doing that, in addition to

giving MDLF life, he also gave us a lesson to remember – nothing is

impossible. We have tried to imprint that same philosophy into MDLF’s

mindset, as that is how we look at every funding proposal we receive.

Anything else would be a betrayal of our own big bang.

sAŠA vUCINIC

Co-Founder and Managing Director, MDLF

Page 12: MDLF First Fifteen Years

Amazon starts

selling books online;

yahoo and ebay

formed

srebrenica massacreWriter and

environmental activist

ken saro-Wiwa

hanged in Nigeria

eduard shevardnadze

elected president

of georgia

prime minister vladimir

Meciar assumes presidential

powers in slovakia, prompting

street demonstrations and

eU condemnation

Us and international

organizations bail out

Mexico with $50 billion

in loans and guarantees

MDLF formed

10

1995

Page 13: MDLF First Fifteen Years

First free daily,

Metro, launched in

stockholm

Israeli prime

minister yitzhak

rabin assassinated

signing of Dayton

peace Accords brings

end to bosnia War

Croatian offensives

take krajina from rebel

serb forces and force

mass serb exodus

Ukraine joins

Council of europe

Newspaper

readership in Us

begins to decline$250,000

totAL FINANCINg provIDeD

sMe Newspaper sLovAkIA

Page 14: MDLF First Fifteen Years

optical fiber cable

extended across

pacific

First Chechen

War ends

yoweri Museveni

wins first direct

presidential

election in Uganda

truth and reconciliation Commission

chaired by Archbishop Desmond tutu

begins hearings into human rights

violations during apartheid

russian president boris

yeltsin wins narrow election

victory over Communists

Ukraine adopts

first democratic

constitution since

independence

Al Jazeera starts

broadcasting

12

1996

Page 15: MDLF First Fifteen Years

36 million

Internet users

Hundreds of thousands

demonstrate in serbia after

local election fraud and

dissatisfaction with president

slobodan Milosevic

radovan karadzic

resigns as president

of republika srpska

after being indicted

for war crimes

guatemalan

government and

guerrillas sign peace

accord, ending 36

years of civil war

taliban take kabul

NovI LIst Newspaper CroAtIA

sMe Newspaper sLovAkIA

$975,000 totAL FINANCINg provIDeD

Page 16: MDLF First Fifteen Years

Former Chinese

paramount leader

Deng Xiaoping dies

streaming audio

and video become

available online

Asian financial

crisis strikes as

economies collapse

and currencies are

devalued

tony blair becomes

prime minister of Uk,

ending 18 years of

Conservative rule

First blog – Dave Winer’s

scripting News – appears

Mobutu sese seko steps

down as president of Zaire

after 32 years; country

renamed Democratic

republic of Congo

kyoto protocol on

Climate Change

adopted

14

1997

Page 17: MDLF First Fifteen Years

Liberal cleric seyed

Mohammad khatami

elected president

of Iran

Above: Hun sen

overthrows Cambodian

prime minister prince

Norodom ranariddh

in coup

Milo Djukanovic

elected president of

Montenegro, defeating

slobodan Milosevic-

backed candidate

Control of Hong kong

handed back to China

Use of Mp3 files

begins to spread

Wave of unrest at

economic collapse

threatens Indonesian

president suharto’s

leadership

A1 tv television Fyr MACeDoNIA

FerAL trIbUNe Magazine CroAtIA

rtv bAJINA bAstA radio Fr yUgosLAvIA

seMbrANI printing house INDoNesIA

sMe Newspaper sLovAkIA

vIJestI Newspaper Fr yUgosLAvIA

$3,419,390 totAL FINANCINg provIDeD

Page 18: MDLF First Fifteen Years

In 1989 and the early 1990s, when the reborn states of eastern

europe set out to write their new constitutions free from any

outside constraints and coercion, their people entered a whole

new universe.

I am not referring to the most obvious aspect of these constitutions–

namely, that by granting basic political and individual rights they

established a new form of government, where we, the people, in a

free political competition elect those who will make our laws, do the

daily work of governing, and deliver justice in a fair way – but to the

fact that the constitutions were the result of a common, democratic

effort. (or at least they were accepted by the majority of the voters

in subsequent elections.)

the social contract was reconstructed, or rather constructed. there is

one, general, written agreement, binding for all citizens of the land.

It is not someone else’s making, but yours too. so you are a party to

it. you have the right to alter it – as much of a right as the person

next to you. you have your vote, and you have your voice.

the implications of this act were far-reaching. It has changed our

relations to almost everything that lies outside us – and inside,

for that matter.

In pre-1989 times you could always say with good reason: the world

I live in does not concern me. I was not asked, so there is no agree-

ment between me and my country, me and the community. between

me and anybody. I am not involved, therefore I am not implicated.

If everything is a lie, I am free to lie too. I might be forced to behave,

to keep the law – but to respect it? It was even an honor to dodge it.

After 1989 this excuse lost its validity. the justification to breach

the law vanished. you became a free citizen of a free country and

you were given all your rights, all empowerments to negotiate your

terms. Instead of some illegitimate power, it was your choices that

came to govern your life. And this concerns not just our relationship

with the government but our interactions with our fellow citizens

too. We had to start making contracts on a daily basis. this has not

been an easy lesson.

you had to learn what it takes to make a contract and to be a party

to an agreement. you have to know yourself and the world outside

you. to negotiate the best possible terms, you have to know the

other party and recognize where his interests, weaknesses, and

powers lie. you have to have a fairly accurate idea about your own

limitations and your would-be partner’s. you have to have a proper

sense of time – a firm conviction that there will be a week after the

next one. And that two or even three weeks from now you might

have to deal with the very same people you deal with today.

you try to make promises that you can deliver, or at least you can

imagine that you will be able to deliver. otherwise you will be

treated as a cheat, and sooner or later no one will want to have

anything to do with you. the contracts you make every day define

you. the sum of your personality is the content of all your contracts,

be they oral or written. It is what the other parties expect you to be,

since this is what you said and signed you would be.

After all, you are a cheat if you do not deliver.

social contracts, loan contracts, and integrity

When the Iron Curtain came down, the citizens of eastern europe no longer had an excuse to disengage from their governments. Now, from constitutions to loan agreements, the contracts we make with others govern our relationship with the world.

essA

y16

Page 19: MDLF First Fifteen Years

I hope it is somewhat clearer now why, being asked to contribute to

this volume on the subject of integrity, I am saying all this. It was in

1998 when I fully understood this. this was the year when Magyar

Narancs approached MDLF for help. Narancs had been leading an

easy life up to that point; we were a creative community of young,

talented writers and journalists living on soft money, and practically

without any responsibility.

but sooner or later soft money always dries up. When this moment

arrived and we found MDLF, their behavior seemed odd: this was

the first time when serious questions on circulation, ad sales,

price policy, readership, costs, quality of reporting, and corporate

organization were asked. All in fact concerned our own capabilities,

the ways we operate and think about ourselves. our own selves.

Negotiating and writing the loan agreement became an exercise in

self-knowledge.

MDLF seemed naïve, even to the point of stupidity. these guys

could not decide whether they were a charity or a venture, so they

chose to be both. No guarantees, no mortgages, no death threats –

a rather strange business philosophy for a loan-providing institution

in eastern europe. How on earth could they think they would get

back even one cent?

It took some time to realize that this could work. If you are treated

seriously, you soon start taking yourself seriously too. And then –

just about everybody does. your readers, your partners, your topics,

your articles. once the loan agreement said who we were, what our

possibilities were, and how we were supposed to operate, we had

to live up to it. We were someone. And if they trusted us, how could

we not have trusted ourselves? (running a big debt brings its own

seriousness anyway.)

even their naïveté, in retrospect, seems well calculated. An element

of MDLF’s corporate culture? you have a bunch of honest people,

mostly very far away, who do not interfere as long as you perform

more or less the way you said you would. the best owners any media

outlet could wish for. It would be shameful not to pay them back.

We broke even.

I am pleased that they have too.

eNDre boJtAr

editor-in-Chief, Magyar Narancs

Page 20: MDLF First Fifteen Years

truth and reconciliation

Commission report brands

south African apartheid a

crime against humanity

google

founded

Mass demonstrations

end Indonesian

dictator suharto’s

30-year rule

Malaysian prime minister

Mahathir Mohamad sacks

deputy Anwar Ibrahim on

charges of sexual misconduct;

Ibrahim arrested

russian financial

crisis and ruble

collapse

serbian security

forces intensify

military crackdown

on kosovo

separatists

First major news event

broken by blogger:

Drudge report reveals

Clinton-Lewinsky affair

MDLF founds

CAMp

18

1998

Page 21: MDLF First Fifteen Years

Center-right coalition

under viktor orban

elected in Hungary

Above: Autocratic prime

minister vladimir Meciar

loses election, sparking

mass celebrations in

slovakia

general Augusto

pinochet of Chile indicted

by spain for human rights

atrocities, arrested in

england

International Criminal

Court established

south African and

botswanan troops

occupy Lesotho “to

restore democracy

and rule of law”

betA press News agency Fr yUgosLAvIA

CHeLyAbINskI rAboCHyI Newspaper rUssIA

DANAs Newspaper Fr yUgosLAvIA

eXpress Newspaper UkrAINe

FerAL trIbUNe Magazine CroAtIA

MIg Newspaper rUssIA

rADIo betA radio sLovAkIA

rADIo pLeveN pLUs radio bULgArIA

vIJestI Newspaper Fr yUgosLAvIA

$5,607,914 totAL FINANCINg provIDeD

Page 22: MDLF First Fifteen Years

Hugo Chávez

inaugurated

as president of

venezuela

olusegun obasanjo

elected president of

Nigeria, ending 33

years of military rule

China announces

severe government

restrictions on

Internet use

Nelson Mandela

stands down as

president of south

Africa and is replaced

by thabo Mbeki

kosovo War: NAto bombs

Federal republic of

yugoslavia

248 million

Internet users

gunmen open fire on

Armenian parliament,

killing prime Minister

vazgen sargsyan and

seven others

20

1999

Page 23: MDLF First Fifteen Years

Militias go on rampage

after east timor votes

for independence –

UN administration

established

peace agreement in

sierra Leone leads

to end of decade of

civil war

Apartment bombings

kill 300 in russia

and spark second

Chechen War

Croatian president

Franjo tudjman dies

Above:

Indonesia’s first

free presidential

elections won by

Abdurrahman Wahid

boris yeltsin resigns

as president of russian

Federation and appoints

vladimir putin as

successor

ALtApress Newspaper rUssIA

CHeLyAbINskI rAboCHyI Newspaper rUssIA

DANI Magazine bosNIA AND HerZegovINA

eXpress Newspaper UkrAINe

FerAL trIbUNe Magazine CroAtIA

kbr68H radio network INDoNesIA

MAgyArNArANCs Magazine HUNgAry

NovI LIst Newspaper CroAtIA

rADIo DrINA radio network bosNIA AND HerZegovINA

vIJestI Newspaper Fr yUgosLAvIA

$10,453,547totAL FINANCINg provIDeD

Page 24: MDLF First Fifteen Years

george W. bush declared

victor after disputed Us

presidential vote count

in Florida

vladimir putin

elected president of

russian Federation

Internet-capable

mobile phones sold

for first time in Japan

First peaceful transfers of

power in African democracies

as Abdoulaye Wade in

senegal and John kufuor in

ghana win elections

Alfonso portillo

sworn in as president

of guatemala

Following death of

Croatian president Franjo

tudjman, ruling HDZ party

loses elections and hands

power to social Democrats

AoL merges with

time Warner

Dot-com

industry crash

22

2000

Page 25: MDLF First Fifteen Years

palestinian-

Israeli conflict

known as

second

Intifada begins

ethnic Albanians

seeking greater

recognition launch

armed insurgency

in Fyr Macedonia

Above:

president Alberto

Fujimori offers

resignation and flees

peru for Japan

Following mass

demonstrations,

Fr yugoslavia

president slobodan

Milosevic resigns

Chinese search engine

baidu formed

Corruption case

against former

Indonesian

president suharto

collapses

google starts selling

text ads

ALtApress Newspaper rUssIA

AMMANNet radio network JorDAN

Atv stAvropoL television rUssIA

CHeLyAbINskI rAboCHyI Newspaper rUssIA

DrIk pICtUre LIbrAry photo agency & Internet service

provider bANgLADesH

eIsk tv television rUssIA

eL perIoDICo Newspaper gUAteMALA

FNr radio network rUssIA

kbr68H radio network INDoNesIA

NepAL rADIo NetWork radio network NepAL

NovI LIst Newspaper CroAtIA

trANsItIoNs oNLINe Web publication CZeCH repUbLIC

tv2 toMsk television rUssIA

$14,113,427totAL FINANCINg provIDeD

Page 26: MDLF First Fifteen Years

In the former soviet bloc it was known as the Cold War. In Latin

America we suffered a “hot war.” In guatemala alone, a small nation

located on the waist of the Americas which is home to twenty-two

indigenous groups, more than two million lives were lost, including

our most prominent intellectual, political, and social leaders. eighty

journalists were slaughtered. Intolerance depleted the moral reserves

of the nation.

We witnessed outrageous savagery and horror. We were told that

the struggle was between Communism and anti-Communism, and

on behalf of this cause freedoms were suffocated, humiliating regimes

established, and unwritten restrictions on social mobility imposed.

We were told that we were defending democracy, but in reality we

lived under the motto “Who is not with me is against me.” We were

told that all this was to gain freedom, even though our rural societies

were still feudal and our so-called modern centers lived by the rules

of mercantilism, a system where privilege and protectionism went

hand-in-hand with anti-competitive behavior. In other words, we

had a type of corrupt regime that can exist even in democracies.

In 1996 a peace treaty was signed after four decades of a war that

witnessed every crime. but the roots of the confrontation – Latin

America’s social inequality, the absence of a market economy, and

outrageous racism – remain. I am not optimistic about our future.

Why? our political culture is still heavily loaded with authoritarianism

and intransigence. We attained electoral democracy, but not civic

democracy in all its different expressions: social, cultural, and economic.

the press has played an ambiguous role. It helped to shepherd the

transition process toward democracy after having been an accom-

plice by either conviction or fear – with a few notable exceptions –

of military dictatorships. It has tried to transform itself but has still

not adapted fully to the new environment: being openly critical and

independent runs against financial viability.

Nevertheless, the press has made an essential contribution to

democracy. It opened pluralistic debate and modernized thinking,

leading us away from the seclusion of dictatorships. the press

created a platform from which citizens could denounce corruption

and incompetence, as well as see the results of their actions.

It provided an interface between the public and information that

used to be the closely guarded property of the state.

Now the challenges facing the press are different: how to acquire

independence from official and extra-parliamentary political powers,

and how to establish financial viability so that it can live up to the

proud tradition of freedom of expression and information – one of

the most expensive traditions in our civilizations.

the press has both been a witness to the last fifteen years of our

intense history, and a promoter of change, especially in the develop-

ment of civil and political rights. It has not only revealed in great

detail – like a close-up photograph – the miseries of power but also

the generosity of the human spirit.

While the berlin Wall was falling, another wall was falling in guate-

mala: the suppression of independent thought. In those days, there

were two independent news outlets – the magazine Crónica and the

building a financial theology out of dignity & freedom

essA

y

the press played an ambiguous role in guatemala’s four decades of war. It supported military dictators yet also helped usher in peace. With the democracy it helped establish far from perfect, the press now faces new challenges – top of the list is financial viability.

24

Page 27: MDLF First Fifteen Years

newspaper siglo veintiuno – which broke with self-censorship and

established a commitment to tolerance, democracy, and respect for

both the law and human rights. they also kept their distance from –

and showed a lack of respect toward – the established powers,

and included criticism and pluralistic views in their editorials.

their impact was tremendous on the political culture of guatemala

but it was very short: little more than a decade. Crónica died in 1998

as a result of an advertising boycott led by ex-president Álvaro Arzú

(who a year before had signed the peace Agreements). A short time

before this, siglo veintiuno became more conservative, following

a disagreement among its members in response to pressure by

ex-president Arzú. this disagreement led to the founding to my

newspaper, elperiódico.

today we live in a democracy and the war has ended, but difficulties

in building democracy are huge. the power of the mafia is boundless

and threatens to turn our democracy into a parody. behind the

facade we show to the world, inequality and aberrant poverty

persist, and delinquency, corruption, and impunity flourish.

the judicial system and parliament carry too little weight in the life

of the country. Judges and public prosecutors act in accordance

with military interests, organized crime, corrupt businessmen, and

on-call governors. Impunity and violence are still deep-rooted in the

foundations of our weak democratic culture. our leaders, in alliance

with private, military, and criminal interests, line their own pockets,

leaving aside the causes they promised to fight for.

Unfortunately, the market economy is not the most powerful force

in guatemala. Instead, it is criminal organizations whose tentacles

spread across key institutions, such as the army, customs, ports,

police, courts, public prosecutors’ offices, and political parties.

they jointly rule our democracy. one fact that helps explain the

intolerable pressure of organized crime in guatemala is that eighty

percent of drugs that end up in the Us have their final warehouse

in my country.

elperiódico was born on November 6, 1996, pioneered by a group

of journalists who were forced to abandon the newspaper siglo

veintiuno. they would not give up the struggle for freedom of

expression, pluralism, respect for human rights, demilitarization, and

cleaning up public life. three years previous, these journalists had

forced Congress and the supreme Court of Justice to be purged –

an event that concluded with the resignation of the 116 legislators

and the Court of Justice in full, who resisted censure and caused the

failure of the coup promoted by president Jorge serrano, who, in the

style of president Fujimori of peru, wanted to centralize the power of

the government.

the process of transition from dictatorship to democracy and from

a mercantilist economy to a market economy has not crystallized.

What has been firmly established in guatemala is an electoral

klepto-dictatorship that has its own beginning and ending every four

years. the struggle for democracy has only not its financial costs but

also intimidation and threats. our publication has survived several

acts of violence, including dynamite and grenade attacks.

In that context, you can understand the difficulties surrounding the

introduction of elperiódico. the first challenge was to work out how

to build a newspaper that demanded an investment of $3 million,

when among the founders we could only gather $10,000. the

klepto-dictator of the time, Arzú, regarded us with suspicion because

of our independence. the industrial elite, the most powerful group

Page 28: MDLF First Fifteen Years

in the country, was not willing to support a handful of dreamers

who believed in what they were preaching: freedom, democracy, the

market, competitiveness. With all credit frozen and without a capital

market, we gambled that in guatemala there might be nontraditional

capitalists willing to invest in a media business that was not tied to

the interests that have restrained growth; after all, democracy is also

an investment where the market freely flourishes.

Among our friends, we identified 300 people capable of investing

$10,000 each in an independent media company. over two months,

we visited those 300 possible investors; 140 of them took the risk

and we gathered $1.4 million, a little bit less than half needed.

We started anyway.

With the first $20,000 gathered, we made the first payment on

a rotary press, the full price of which was sixty times that amount.

the next $10,000 was for renting offices and a warehouse where

we installed the printing plant, other equipment, and stored

newsprint. With another $10,000, we created an ambitious

database of 50,000 families of a similar socio-economic status,

who would be our potential customers. We hired the best

administrative and journalistic personnel we could find.

by identifying with our principles, many journalists joined us,

sacrificing their incomes. After five months, a new independent

newspaper was circulating on the streets.

surviving on such precarious financial foundations, we had to think

creatively. No one believed, because it had not been tested, in

pre-paid advertising packages, even less in a mass medium which

did not exist. We capitalized elperiódico with $250,000 through that

formula, which gave us some stability. today, this practice represents

an annual income of $1,500,000.

We went beyond the boundaries of investigative journalism.

In our part of the world, a reporter usually reports plain facts and

transcibes statements. there is no opportunity to analyze, compare

sources, and go to the core of a phenomenon, nor to explore

causes and effects. It is not cheap to do and, because of a lack of

experience, we did not have the qualified personnel to carry it out.

It was in every sense – financial, methodological, human resources –

an impressive challenge. today, however, I can proudly say that we

have created the first practical school of investigative journalism.

the powerful elites remain concerned by what we do – revealing

their hidden stories and exposing corruption. For the rest, there is a

change in the public debate agenda. It is no longer established by

the government only.

Another contribution to journalistic culture has been elperiódico’s

sunday supplement, one of the most prestigious cultural magazines

in Central America and, without any doubt, the liveliest guatemala

has had. We set up this supplement despite a total government ad-

vertising boycott, and a hidden government campaign to remove pri-

vate advertisers – a defamatory and calumnious campaign personally

led by ex-president Arzú against the president of elperiódico, whom

he publicly and privately accused of being Communist, a radical-right

apologist, a drug trafficker, a spokesman for smugglers, etc.

All this took place in a country where the concentration of wealth, as

well as political, military, and criminal power, maintains a severe and

constant pressure on the freedom of the press. We aggressively made

a joint venture with prensa Libre, the country’s leading newspaper

publisher. this meant selling sixty percent of our shares to that pub-

lisher but zealously guarding publishing independence. While this joint

venture lasted, elperiódico was forced to hand its printing house over

to prensa Libre, together with its forty percent interest in a separate

successful popular newspaper that the elperiódico team had origi-

nated. Later, prensa Libre offered to buy our shares, and in response

we proposed that we have a first option to buy back from prensa Libre

full control of elperiódico, with the condition that, should we not be

able to complete the purchase by a set deadline, prensa Libre would

be entitled to buy full control of elperiódico on the same terms.

We offered: a) $1,000,000; b) freeing prensa Libre of its guarantee

of elperiódico’s $2,000,000 debt to local banks, by replacing it with

new guarantees; and c) a monthly payment of $80,000 for prensa

Libre to continue printing elperiódico. prensa Libre accepted the

offer. elperiódico proposed to pay the $1,000,000 by giving prensa

Libre that value of advertisement space in its own pages for four

years. the offer was accepted after a process of discussions, with a

good shot of mistrust from both sides, took place.

As regards replacing prensa Libre’s guarantee with the banks,

elperiódico suggested to both financial institutions holding the debts

that instead of a single guarantee they would accept 120 separate

guarantees of around $17,000 each. As the banks, surprisingly,

accepted the proposal, we identified 120 people who were able to

provide the guarantees. Application forms and legal documents were

filled in for each person and then we visited them. they, willingly

and without any condition, gave their guarantees to the banks.

As regards the monthly payment of $80,000 for printing, and in

order to cover the first month, a donation from Fundación soros was

obtained. For the next three months, we sold pre-paid advertising

packages, and for the next quarter, an international development

agency that supports Ngos in areas such as democracy, transparency,

and human rights financed an investment in elperiódico on behalf

of a number of such Ngos. by this means, elperiódico obtained

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Page 29: MDLF First Fifteen Years

$160,000. In order to guarantee the viability of our journalistic

project, it was necessary to find the support of either a partner or

a solid financial institution that could provide fresh capital and/or a

loan under reasonable conditions, in the amount that, at that time,

was estimated at $1,800,000. by doing so, we wanted to partially

replace the local loans subject to high interest rates and very short

terms, and also secure working capital to finish the project and

strengthen its financial structure – hence, providing the foundations

of its publishing independence.

We found and submitted an application to Media Development Loan

Fund. Its philosophy is also ours: commitment to freedom of expres-

sion, democracy, respect for human rights, and supervision of public

power. We met its criteria as an independent media business with

potential for financial success.

MDLF operates as a non-profit investment bank, providing loans

to its clients at low interest rates or making capital investments,

along with managerial training and technical assistance. More than

a simple lender or investor, MDLF gets involved in a long-term close

relationship, which begins with the implementation process to its

financial support program.

In the case of elperiódico, MDLF got closely involved in all our prob-

lems, starting with the development of a five-year business plan,

which is monitored on a monthly basis, and the complex negotiations

carried out with prensa Libre. It has sent experts in all business areas

and developed the organization to face critical environments.

even more significant, we have been accompanied, physically and

morally, by MDLF throughout the risky events that we have faced

over the past eight years. From financial complications to pro-

government aggression, threats by presidents, fiscal persecution,

and assaults on our physical integrity. this has been a key factor in

allowing us to stay – despite our extreme precariousness – over the

past years of recession and economic regression.

It is still hard for us to believe that we have already overcome the

twelve months of 2009 – the most dramatic, complex,and delicate

months of our business-related and journalistic history. only the

serenity, faith, confidence, experience, humaneness, and encourage-

ment of sasa vucinic, Harlan Mandel, Jaroslaw gora, elena popovic,

Majka Nemcova, and the entire group of MDLF allowed us to find

shelter in a safe harbor. today, we are an enterprise on the threshold

of a year that promises to be the best in our history, by creating

content for us and third parties, for traditional and new audiences,

through both conventional and new digital platforms.

In my personal case, by taking part in discussions and forums, most

of them at MDLF’s invitation, I have been able to understand that I

was suffering post-traumatic stress disorder after an armed assault

on my home in 2003 and my kidnapping and attempted murder

at the end of 2008 – all of which had lasting effects, though I am

beating them and, therefore, taking back control of my life.

In all these efforts, we have held on to god and extraordinary

friends with imagination and a firm belief that only the impossible is

what remains to be done. but, especially, we have counted on MDLF

for being successful. From these principles of freedom and dignity,

we have created a financial theology that has turned out to be dar-

ing and extraordinarily creative – one that we are still here to talk

about and keep believing in.

José rUbéN ZAMorA

president, elperiódico, guatemala

Page 30: MDLF First Fifteen Years

China joins World

trade organization

New partnership for

Africa’s Development

(NepAD) launched to

promote economic

development

silvio berlusconi

elected prime

minister of Italy

Nepalese royal

massacre leaves

ten dead as prince

gyanendra inherits

throne

slobodan Milosevic arrested and

extradited to the Hague for trial

by International Criminal tribunal

for former yugoslavia

georgian president eduard

shevardnadze sacks

government after street

demonstrations in support of

private tv station rustavi 2

Us leads invasion

of Afghanistan

MDLF holds first

Media Forum

28

2001

Page 31: MDLF First Fifteen Years

gazprom takes over

Ntv, russia’s only

national non-state

tv company

Megawati sukarnoputri

sworn in as president

of Indonesia as

Abdurrahman Wahid is

removed from office

Dozens arrested

in Malaysia during

clashes between

Malays and ethnic

Indians

Ukrainian prime minister

viktor yushchenko’s

government dismissed after

losing no-confidence vote

september 11 attack

on Us by al-Qaeda

Wikipedia

launched

b92 television, radio, online Fr yUgosLAvIA

eXpress Newspaper UkrAINe

MALAysIAkINI online publication MALAysIA

MeDIA Works Internet service provider Fr yUgosLAvIA

oNogost Magazine Fr yUgosLAvIA

pArMA NovostI Newspaper rUssIA

preMIer Newspaper rUssIA

rADIo eCCLesIA radio ANgoLA

rADIo rotA radio CZeCH repUbLIC

reporter Magazine bosNIA AND HerZegovINA

tv2 toMsk television rUssIA

vIJestI Newspaper Fr yUgosLAvIA

$20,221,952 totAL FINANCINg provIDeD

Page 32: MDLF First Fifteen Years

president Alvaro Uribe of

Colombia declares state of

emergency as FArC detonates

bomb before inauguration

president robert Mugabe

wins fifth term in office as

famine sweeps Zimbabwe

east timor gains

independence

after 24 years of

Indonesian rule

google News releasedJonas savimbi dies,

ending UNItA’s

37-year guerilla

war in Angola

euro launches

30

2002

Page 33: MDLF First Fifteen Years

bali nightclub

bombing leaves

202 people dead

Hamid karzai

installed as interim

Afghan leader

Friendster sets up

first online social

network

Chechen rebels seize

Moscow theatre and

hold 800 hostage –

174 killed as russian

forces end siege

587 million

Internet users

ALtApress Newspaper rUssIA

Atv bANJA LUkA television bosNIA AND HerZegovINA

betA press News agency Fr yUgosLAvIA

CHeLyAbINskI rAboCHIy Newspaper rUssIA

eXpress Newspaper UkrAINe

FerAL trIbUNe Magazine CroAtIA

INForM poLIs Newspaper rUssIA

kbr68H radio Network INDoNesIA

MAgyArNArANCs Magazine HUNgAry

MALAysIAkINI online publication MALAysIA

MoLoDoy bUkovINets Newspaper UkrAINe

NoseWeek Magazine soUtH AFrICA

preMIer Newspaper rUssIA

rADIo HAI radio ArMeNIA

rADIo preMIer radio rUssIA

reporter Magazine bosNIA AND HerZegovINA

$26,568,362 totAL FINANCINg provIDeD

Page 34: MDLF First Fifteen Years

Armenian president

robert kocharian

wins second term

amid accusations of

fraud

serbian prime

minister Zoran

Djindjic assassinated

in belgrade

Liberian president

Charles taylor seeks

exile in Nigeria, ending

14 years of civil war

violent protests

over gas exports

force president

sanchez de Lozada

of bolivia to resign

Myspace.com

launches

Us and coalition

forces invade Iraq

Above: World Health

organization warns

of possible sArs

pandemic

32

2003

Page 35: MDLF First Fifteen Years

Mikhail khodorkovsky

– the wealthiest man

in russia and sixteenth

wealthiest in the world –

arrested and accused of fraud

Abdullah Ahmad badawi

becomes prime minister

of Malaysia as Mahathir

bin Mohamad steps

down after 22 years

president vladimir

putin gains almost total

control over parliament

after United russia

party wins landslide

rose revolution

sweeps georgian

president eduard

shevardnadze

from power

Above: oscar berger wins

guatemalan presidential

election, causing

predecessor Alfonso

portillo to flee to Mexico

Atv stAvropoL television rUssIA

b92 television, radio, online serbIA AND MoNteNegro

borIsogLebsk tv television rUssIA

CorNet radio network sIerrA LeoNe

eL perIÓDICo Newspaper gUAteMALA

FerAL trIbUNe Magazine CroAtIA

IDeeLe Magazine, radio network perU

krestyANIN Newspaper rUssIA

MAIL & gUArDIAN Newspaper soUtH AFrICA

MALAysIAkINI online publication MALAysIA

MoLoDoy bUkovINets Newspaper UkrAINe

NoseWeek Magazine soUtH AFrICA

rUstAvI 2 television georgIA

$34,728,730 totAL FINANCINg provIDeD

Page 36: MDLF First Fifteen Years

Advertising is abandoning old media. For the first time since the advent

of mass media, in the middle of the nineteenth century, advertisers can

do without the news media to introduce their products to consumers.

It’s not that they have suddenly stopped putting their advertisments

there, but “news” is now only one medium amongst others – and not

always the best – in a universe where digital technology and the

Internet have increased the ways of reaching the public.

of course, advertising has been using channels other than news-

papers for a very long time. And, also for a long time, the “news”

on radio and television has accounted for a decreasing part of the

programming. but the illusion persisted: the “information” aspect

of broadcasters continued to define radio stations and tv channels,

even if most of the programming was entertainment. but for most

of the new vehicles that are appearing on the Internet, providing

information is no longer necessary.

An American study highlighted that “the crisis in journalism has less

to do with where people get information than how to pay for it ...

It may not strictly be loss of audience. It may, more fundamentally,

be the decoupling of news and advertising” (the state of News Media

2008). It shows clearly that the people in charge of the news media

are faced with the challenge of having to reinvent themselves and find

a new business model while reducing the cost of producing the infor-

mation. “It’s like needing to change the engine oil whilst driving on

the motorway,” said Howard Weaver, editor at McClatchy Company.

such drastic destabilization has been happening throughout the past

decade. Day after day, information is further reduced as a loss leader,

an end-of-the-aisle display on the Internet, on tv, and radio. And

because daily newspapers are expensive to make and give work to

more journalists than other media, they have become the most vulner-

able. And yet the size and competence of their editorial team is their

main comparative advantage. there lies the key: traditional news

media are put in danger of death by the multiplication of new media,

most of which are producers and broadcasters of entertainment and

services, search engines such as google, or social networks. “the

multiplication of media has made the advertisers’ strategy more and

more complex,” wrote media consultant pascal Josèphe, “and even if

media leaders can still assert their power, advertising investments are

divided up.” (La société immédiate, Calmann-Lévy, 2008, p. 85.)

Advertisers doubt the effectiveness of advertising in mainstream

media (general newspapers, radio stations, and tv channels)

because, in spite of documented research by specialist bodies, they

no longer really know who their ads reach (housewives under fifty,

socio-professional categories, etc.). the old joke in the advertising

world is no longer funny. Advertisers are tired of “knowing that

half their budget is wasted and of not knowing which half.” they

want to be able to identify their targets better, which is what digital

technology promises to do, and even to know exactly who sees the

ad and who wants to buy and will buy the product.

otherwise, they fear that they will just be throwing their money

away. this kind of reluctance is, of course, stronger in times of

economic difficulties. the purpose of advertisers is not to finance

the press and information. It is not their job, and newspapers, radio

stations, and television channels are nothing to them other than

How will we fund the Fourth estate?

the advertising-based model of financing the press is collapsing. Classifieds have already dried up, while brand advertisers are defecting to the Internet in search of instant, targeted, measurable access to consumers.

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Page 37: MDLF First Fifteen Years

“media” whose “content” is not necessarily “news.” the migration

of advertising budgets seems unstoppable. the whole economic

model of news media is destabilized. Newspapers were the first hit,

but now the whole information chain is under threat.

FANtAstIC groWtH

In 1995, there were only 23,500 websites; in July 2007, the Uk

company Netcraft counted more than 125 million. Never before

has a technology spread so fast and so massively. And it won’t

stop there. 2008 saw the emergence of a new advertising market

destined to grow fast: mobile telephony. A huge competition was

launched between the network giants and all the players on the

digital chain, fighting for new mobile subscribers and consumers

of the products that will be on offer. In fact, it has already started.

“telecom operators,” orange Ceo Didier Lobmbard argues, “can no

longer withdraw into themselves and confine themselves to selling

pipes but must become true public amplifiers and reap corresponding

advertising revenue ... Whereas up until now the race for advertising

revenue was the preserve of the traditional Internet services players

(such as google and yahoo!), operators can now occupy these new

territories.” (pascal Josèphe. La société immédiate, Calmann-Lévy,

2008, p. 85.) Not reassuring for the press.

Didier Lombard explains very clearly that a battle for value has been

launched throughout the media’s production chain, in the widest

sense of the word “media.” From oeMs, networks, access providers,

services providers, and search engines through to content designers.

the same competition has started looking at the design and manage-

ment of advertising, and google’s attacks on that front show that the

battle will be merciless. each wants to capture the public, the paying

customers, and the advertising on the way. that is why there is a shift

toward large groupings and a general move toward convergence.

All new websites are not yet viable, and some never will be, but

it only took for them to deflect 10% to 15% of the budgets of the

traditional press to plunge it into an unprecedented crisis. the video

games explosion and that of “social” sites could potentially consume

further big slices of the advertising pie. Advertising investments are

not endless, and the market shares that are deflected toward new

electronic media are usually lost forever.

ADvertIsINg Is MIgrAtINg to tHe INterNet

online advertising should see a growth of more than 20% over the

next year. only a minute part of these budgets will be picked up by

newspaper websites. None of the traditional media can escape this

earthquake. Indeed, tv remains – but for how long? – the last big

mass media, the one which still gathers the whole family, or a good

part of it, in the front room. It is indispensible to the big advertisers

when they want to launch mass consumer products or new global

brands. but advertising professionals believe that the rise in price of

tv ads, when the large general channels’ viewing figures are falling,

is excessive. In the Us, the viewing figures for the big tv networks

have dropped by 2% per year over the last ten years, whereas the

American population grew by 30 million people.

“We are seeing an inevitable and slow collapse of the whole mass

media market,” J.-D. Lasica, Chairman of social Media group, said,

while Jim stengel, Head of Marketing at procter and gamble, a

giant advertiser with a $5.5 billion budget, assured the American

Association of Advertising Agencies that the current advertising

model was “broken.”

toWArD tHe FULLy DIgItAL

Meteoric technological advances speed up and increase the effects

of these upheavals. “It’s only a matter of time before all advertising

Page 38: MDLF First Fifteen Years

becomes digital,” Dominique Delport, Ceo of Havas Média

explained. “It will be possible to react very quickly and place ads ‘on

demand.’” If the big networks, such as Cbs in the Us or tF1 in

France, fall victim to the fragmentation of the viewing public, “old”

media, like cinema, will get a second youth by benefitting from

digitization. thanks to digitization, advertising films can already be

made almost instantly. Until now, they were shot long before being

played in cinemas and did not change, come what may.

social networks, such as Facebook, Myspace, twitter, Flickr, and

second Life, are or are going to be, for the most part, a new

advertising el Dorado, thanks to their ability to gather a public that

is both loyal and often connected 24/7. they provide a lot of data

on their users, who, furthermore, form sub-groups with common

interests. they could help target ads with more accuracy. It’s in

order not to be out of its depth in the digital world that publicis

acquired Digitas, a digital specialist agency, for $1.3 billion. With

this acquisition, publicis aims to make – by subcontracting to

low-cost countries – thousands of versions of the same ad. then,

with computer algorithms, its clients will be able to target each

consumer with a matching ad, at the most effective time.

that will be the end of ads with an unknown real impact. For

advertisers and agencies, the Internet and digitization also open up

a new era with performance-related billing: ads will no longer be

launched blindly and we will know – we already know – immediately

if they are effective. prices are proportional to the number of clicks

registered on the ad and possibly to the subsequent purchases.

“It’s by spending more and more time on the Internet that consumers

build their purchasing decisions. therefore, that is where advertisers

must be, and we help them target their customers at the best time,”

David kenny, head of Digitas UsA, explained to more than four

hundred representatives of the world’s leading newspapers,

gathered in Amsterdam in october 2007. straight after him, steve

seraita, vice-Chairman of the large Us firm scarborough research,

hammered the nail in: “the printed press,” he said, “will soon no

longer be the basic medium for an advertising campaign.”

A HIgH rIsk sHIFt

In the face of the digital flood and this massive advertising shift, it’s

as if numerous newspaper publishers and media group leaders have

been experiencing a fit of panic. they were first unsettled by the

near disappearance of the gold mine that was classified advertising,

from job ads to housing ads and car ads: only ten years ago,

classified ads still accounted for 76% of the advertising revenue of

daily papers. today, they have melted like snow in the sun. In France,

the drop in classified ads turnover has been 20% per year since

2004. soon, people won’t buy a newspaper to find a job, much less

to find a flat or a used car.

Faced with the erosion of their balance sheets, publishers have often

rushed to the Internet like they would a magic potion. In reality, they

don’t yet know what the true effects or the economic effectiveness

will be. to this day, most newspaper sites don’t generate enough

revenue to survive and less so to develop quality information.

Newspaper websites are very far from making as much money as their

print parent companies, and their advertising rates are much lower.

What takes place is an unequal swap: euros for cents. At Le Figaro,

for example, classified ads on the website are sold at a rate seven

times lower than was charged by the printed paper. “even if you

double or triple this revenue, it won’t be enough,” the head of one

large group acknowledged. Aware that they don’t measure up to

the new Net giants, some are grouping. In the Us, four large press

groups (tribune Co., gannett, Hearst, and the New york times

group) have united around a joint offering to advertisers. With

Quadrantone, advertisers can buy space on the websites of 170

local media, which represents 50 million single visitors per month.

this initiative is not insignificant, but it has not yet born much fruit

since advertising on newspaper websites is still progressing more

slowly than on all other sites. And it comes very late. Had French

newspapers been capable at the end of the nineties to group their

classified ads offering, they wouldn’t have been “stripped” by the

newcomers, “pure players” on the Internet. However, in the digital

world, lost places cannot be regained.

press bosses are taking the full measure of the situation: they have

entered, for a few years, a most perilous shift period. “think of

yugoslavia,” bob garfield, one of the best American advertising and

marketing analysts, wrote. “Milosevic was overthrown, democracy

was reinstated but, five years later, unemployment in serbia was 32 %,

the prime Minister was assassinated and war criminals were still on

the run … there is no way to make the transition into anything that is

different, or new or whatever without chaos. Likewise in the transition

from old media to new. the new paradigm will not be established

overnight.” (“Chaos theory 2.0,” Advertising Age, 4 April 2007.)

In 2008, google Ceo eric schmidt said that with the collapse of their

classified ads market, newspapers had entered “a world of aches

and pains” and that their future looked “particularly gloomy” to him.

Forty-eight hours later, it was announced that the Los Angeles times

was laying off 150 journalists – 17% of its editorial team.

berNArD poULet

editor-in-Chief, L’expansion

Chair of MDLF board of Directors

essA

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Page 39: MDLF First Fifteen Years
Page 40: MDLF First Fifteen Years

Former general susilo

bambang yudhoyono

wins second round of

presidential elections in

Indonesia

UN acknowledges pro-

government “Janjaweed”

militias in sudan

responsible for mass

killings in Darfur

ten new countries

join european Union

Above: At least 334

hostages, mainly children,

die as russian special

forces end beslan school

hostage crisis

Mikhail saakashvili

wins landslide

victory in georgian

presidential election

orange revolution

in Ukraine ushers in

viktor yushchenko

as president

“podcasting” coined

as term for Internet

delivery of radio-

style content

38

2004

Page 41: MDLF First Fifteen Years

Malaysian opposition

leader Anwar bin Ibrahim

freed from jail after

court overturns sodomy

conviction

“oilgate” scandal

in south Africa after

ANC siphons off

state oil money

UN ends monitoring

of peace process in

guatemala, despite

widespread crime and

human rights violations

Facebook

launches

yasser Arafat,

president of

palestinian National

Authority, dies

Asian tsunami kills more

than 160,000 in Indonesia

and tens of thousands

more across continent

ArAbIC MeDIA INterNet NetWork (AMIN) online IsrAeL

Atv bANJA LUkA television bosNIA AND HerZegovINA

b92 television, radio, online serbIA AND MoNteNegro

betA press News agency serbIA AND MoNteNegro

CAMbIo Magazine CoLoMbIA

CHeLyAbINskI rAboCHyI Newspaper rUssIA

eL perIÓDICo Newspaper gUAteMALA

INForM poLIs Newspaper rUssIA

krestyANIN Newspaper rUssIA

MAIL & gUArDIAN Newspaper soUtH AFrICA

MeLItopoLskIe veDoMostI Newspaper UkrAINe

MoI rAyoN Newspaper rUssIA

ok rADIo radio serbIA AND MoNteNegro

oNogost Magazine serbIA AND MoNteNegro

rUstAvI 2 television georgIA

tHe post Newspaper ZAMbIA

toMsk press Newspaper rUssIA

$43,669,404 totAL FINANCINg provIDeD

Page 42: MDLF First Fifteen Years

kyoto protocol on the

environment comes

into force without Us

participation

south African president

thabo Mbeki sacks deputy

Jacob Zuma following

corruption scandal

1 billion

Internet users

Hundreds of thousands

left homeless as

Zimbabwe government

destroys slum housing

king gyanendra

of Nepal dismisses

government and

imposes martial law

Mahmoud

Ahmadinejad

elected president

of Iran

MDLF launches

Free press

Investment

Notes in Us

40

2005

Page 43: MDLF First Fifteen Years

ellen Johnson-sirleaf

becomes president of

Liberia, Africa’s first

female head of state

250,000 people

demonstrate for

democracy in Hong kong

socialist leader evo Morales

wins presidential election,

becoming first indigenous

bolivian to take office

youtube launched Indonesia signs

peace deal with

Aceh separatists

ALtApress Newspaper rUssIA

Atv bANJA LUkA television bosNIA AND HerZegovINA

borIsogLebsk tv television rUssIA

eL FAro online publication eL sALvADor

eL perIÓDICo Newspaper gUAteMALA

grIvNA Newspaper UkrAINe

krestyANIN Newspaper rUssIA

MAIL & gUArDIAN Newspaper soUtH AFrICA

MoI rAyoN Newspaper rUssIA

oNogost Magazine serbIA AND MoNteNegro

tv2 toMsk television rUssIA

yAkUtsk veCHerNy Newspaper rUssIA

$50,402,923 totAL FINANCINg provIDeD

Page 44: MDLF First Fifteen Years

king gyanendra reinstates

democracy after 500,000

people demonstrate in

kathmandu

Montenegro

declares

independence

Chinese government

builds firewall to

censor Internet content

slobodan Milosevic

found dead in cell

in the Hague

Hamas wins elections to

palestinian parliament –

Israel, Us and eU refuse

to recognize new

government

russian journalist

Anna politkovskaya

murdered

Mass demonstrations

and Danish embassies

attacked following

publication of cartoons

of prophet Mohammed

MDLF launches

voncert on Zurich

stock exchange

and publishes first

Impact Dashboard

42

2006

Page 45: MDLF First Fifteen Years

Fidel Castro

temporarily

transfers duties as

president of Cuba

to brother raul

violence erupts as

thousands demand

resignation of Hungarian

prime minister Ferenc

gyurcsany

general Augusto

pinochet dies after

being formally charged

in Chilean courts for

human rights violations

Joseph kabila wins

first elections in DrC

for four decades

Ukrainian president viktor

yushchenko accepts rival

viktor yanukovych as

prime minister to avoid

new elections

twitter

launched

gas Wars begin

between russia

and Ukraine

ALtApress Newspaper rUssIA

ANrI publishers association rUssIA

Atv bANJA LUkA television bosNIA AND HerZegovINA

Atv stAvropoL television rUssIA

b92 television, radio, online serbIA AND MoNteNegro

bALkAN INvestIgAtIve reportINg NetWork (bIrN)

online bosNIA AND HerZegovINA

betA press News agency serbIA

borIsogLebsk tv television rUssIA

CHeLyAbINskI rAboCHyI Newspaper rUssIA

eL perIÓDICo Newspaper gUAteMALA

eXpress Newspaper UkrAINe

INForM poLIs Newspaper rUssIA

kbr68H radio network INDoNesIA

krestyANIN Newspaper rUssIA

Le QUotIDIeN Newspaper seNegAL

MAIL & gUArDIAN Newspaper soUtH AFrICA

MeLItopoLskIe veDoMostI Newspaper UkrAINe

MoLoDoy bUkovINets Newspaper UkrAINe

pArMA NovostI Newspaper rUssIA

rADIo 021 radio serbIA AND MoNteNegro

rADIo preMIer radio rUssIA

rtv21 radio, television serbIA AND MoNteNegro

$61,409,057 totAL FINANCINg provIDeD

Page 46: MDLF First Fifteen Years

In times of great change, there’s bound to be some confusion.

so it’s not surprising that journalists are still trying to make

sense of the Internet revolution that threatens to smother us.

but in reality, it’s media companies that are under threat, not so

much journalism. Indeed, profit margins are being squeezed, and

advertisers are migrating online. In addition, the media landscape

is being irreversibly altered by the growing fragmentation of

information. to top this, those who were once spectators have

now invaded the pitch and are demanding to join in the game

too – giving rise to the new phenomenon of “citizen journalism.”

to survive, some old media will have to merge. some will bite the

dust. but old media will not disappear completely – newspapers,

in one form or another, will remain, just like their old media

cousins, television and radio.

CoNteNt Is Not kINg

Content is king, so they say. they’re wrong. Content is Not king.

technology is. Content providers – newspapers, television, and

radio stations – are facing problems everywhere. It’s technology

and telecommunications companies that are reaping the rewards

of the Internet. For the first time last year, advertisers in the

United kingdom spent more online than on newspapers. In the

Us, online advertising has already outstripped that of radio.

Worse still, competitors for the advertising dollar include those

which are not strictly content providers – youtube, Myspace, and

Flickr, to name a few. In other words, advertisers no longer rely

on journalism to deliver eyeballs the way they once did with old

media. Indeed, none of the top four online companies – google,

yahoo, MsN, and AoL – are media companies. they and forty-five

others control over ninety-five percent of the online advertising

market. Anyone outside this elite group faces intense competition

for a relatively small pot of money.

Free or pAy MoDeL?

true, old media have joined the race to claim a piece of the

cyberturf, but their online income has so far failed to make up

for the sharp decline in their traditional operations. Malaysiakini

(MalaysiaNow), when it was launched ten years ago, very

quickly came to the realization that a free model is financially

unsustainable. Indeed, news organizations are shooting

themselves in the foot by offering their content for free. eight

years ago, Malaysiakini migrated to a subscription-based model,

requiring our readers to pay a subscription of $6 per month.

It was a painful process, as we saw our readership drop like a ton

of bricks. but we persevered, and over the years, we are able to

convince more and more readers to pay and eventually make a

profit. Not surprisingly, other media organizations are thinking

of adopting the pay model. the New york times website will be

implementing it from next year. rupert Murdoch, whose Wall

street Journal online already charges for content, will introduce

subscriptions for the other newspapers in his News Corp stable.

pArty eNDs For oLD MeDIA

Clearly, the party has come to an end for old media. stocks of

these companies are in a free-fall. to satisfy Wall street, media

companies are cutting costs. Journalism suffers as a result.

technology has given us more power over how we consume

Is the Internet a threat to journalism?

With the advent of the Internet, journalism as we’ve known it for over a century is long gone. but the role of journalist – in recording events, in building opinions, in presenting facts – is here to stay.

essA

y44

Page 47: MDLF First Fifteen Years

information, and media organizations have been trying hard –

often unsuccessfully – to understand this new role. In cyberspace,

everyone can have a voice. power has shifted to the consumers

of information, who are increasingly content creators as well.

At the same time, however, there’s a tendency for news and views

to degenerate into noise. the proliferation of new media does

not necessarily give us better choices. More choices, yes, but not

better choices. the vast majority of unsolicited opinion on the

Web is banal, uninteresting, and often offensive. In the end, it’s

our search for quality that will separate the wheat from the chaff.

Which brings us to another issue: like it or not, media companies

no longer have a monopoly on the truth. Media is anything people

want to read, watch, or listen to – whatever the source, whether

amateurs or professionals. And they want it at their fingertips

through devices such as mobile phones, pDAs, and laptops.

Now that’s a pretty scary thought for journalists.

everyoNe CAN be A JoUrNALIst?

More troubling, however, is the idea that everyone can be a

journalist. there’s no doubt that bloggers have played a very

important role in improving journalism. they help check bad

journalism. they pinpoint mistakes and inaccuracies. they provide

alternative viewpoints. but bloggers will have to live up to the

very standards they demand from journalists – in getting the facts

right, in exercising similar discipline in the verification process,

in not peddling hearsay as news. Dan gillmor, author of We,

the Media and widely considered the father of citizen journalism,

is well aware of this. In a debate I had with him at a media

event a few years ago, he conceded that there is just as much

irresponsible blogging as there is bad journalism. Correction.

perhaps more. gillmor is today dedicating much of his effort to

help improve the standards in the blogosphere.

bAD bLooD

yes, there has been a lot of bad blood between bloggers and

journalists. but it’s time to put an end to this war. Do we want to

live in a world where there are only bloggers and no journalists?

surely not. After all, everyone has an opinion, and many do-it-

yourself journalists can do it much better than the so-called lords of

the profession. yet most independent accounts of local and global

events have come from professional journalists. It is imperative that

this continues. on the other hand, would we want to live in a world

populated by only journalists and no bloggers? Definitely not.

It is for this reason that Malaysiakini is launching a program to

train a team of citizen journalists who can help us cover news.

since we kicked off that project a year ago, we have trained over

100 citizen journalists – all of whom are equipped with not just

basic reporting skills but also an appreciation for journalistic ethics.

there is no doubt that the Internet is a threat to journalism.

Moreover, it is open to massive state censorship and disinformation

on a scale previously unknown. yet authoritarian regimes, while

seeking to maintain control over the Internet’s political impact, are

at the same time eager to exploit its technological benefits. that’s

the dilemma which civil society and independent media must exploit.

the Internet is not going to go away. We all have to learn to

embrace it.

steveN gAN

editor-in-Chief, Malaysiakini

Page 48: MDLF First Fifteen Years

bulgaria and

romania join

the eU

Fighting between

Hamas and Fatah

divides palestinian

Authority

three salvadoran members of

Central American parliament

assassinated in guatemala with

help of local police

Apple unveils

iphone

british court rules that

former Zambian president

Frederick Chiluba

conspired to rob Zambia

of $46 million

Above: pakistani president

pervez Musharraf

suspends Chief Justice,

leading to widespread

demonstrations

46

2007

Page 49: MDLF First Fifteen Years

burmese military

violently suppresses

“saffron revolution”

state of emergency

declared in georgia

as riot police battle

protesters demanding

president’s resignation

Above: ethnic

political conflict

explodes in kenya

following failure of

presidential elections

Hundreds of

thousands protest

in bogota against

kidnappings and

conflict in Colombia

Former pakistani

prime minister

benazir bhutto

assassinated

Above: Landslide election

victory by bangladesh

Awami League alliance

restores democratic

government

Atv bANJA LUkA television bosNIA AND HerZegovINA

Atv stAvropoL television rUssIA

borIsogLebsk tv television rUssIA

CHeLyAbINskI rAboCHyI Newspaper rUssIA

greeN WAve radio georgIA

grIvNA Newspaper UkrAINe

kAFA Newspaper UkrAINe

keNDArI tv television INDoNesIA

Los tIeMpos Newspaper boLIvIA

MAIL & gUArDIAN Newspaper soUtH AFrICA

MoLoDoy bUkovINets Newspaper UkrAINe

pANCevAC press Newspaper serbIA

ppMN Media support foundation INDoNesIA

rADIo booM 93 radio serbIA

tv2 toMsk television rUssIA

UJyAALo 90 NetWork radio network NepAL

vIJestI Newspaper MoNteNegro

$72,127,869 totAL FINANCINg provIDeD

Page 50: MDLF First Fifteen Years

global

financial

crisis strikes

Above: Fidel Castro

formally resigns as

president of Cuba

1.5 billion

Internet users

Dmitry Medvedev wins

presidential elections

in russia, while

vladimir putin becomes

prime minister

south African president

thabo Mbeki resigns over

allegations of interfering

in corruption case against

Jacob Zuma

MDC claims outright

victory in Zimbabwean

elections and boycotts

run-off

Ugandan government

and LrA sign permanent

ceasefire but rebel

leader Joseph kony fails

to attend

Former bosnian

serb leader radovan

karadzic arrested in

serbia

48

2008

Page 51: MDLF First Fifteen Years

Above: pervez

Musharraf steps

down as president of

pakistan

kosovo declares

independence from

serbia

tensions between russia

and georgia escalate

into full-blown military

conflict over south

ossetia

bolivian president

evo Morales gains

67% of vote in recall

referendum on his

leadership

Above: thai news

outlets silenced, but

citizen journalists

report on protests

and political violence

86 alleged coup plotters

appear in court in

turkey’s ergenekon trial

AkZIA Newspaper rUssIA

ALtApress Newspaper rUssIA

ANrI publishers association rUssIA

Atv bANJA LUkA television bosNIA AND HerZegovINA

bAtUMeLebI Newspaper georgIA

betA press News agency serbIA

borIsogLebsk tv television rUssIA

gLobAL voICes online gLobAL

grIvNA Newspaper UkrAINe

kACHkANArsky CHetverg Newspaper rUssIA

kbr68H radio network INDoNesIA

krestyANIN Newspaper rUssIA

LesotHo tIMes Newspaper LesotHo

MAIL & gUArDIAN Newspaper soUtH AFrICA

MeLItopoLskIe veDoMostI Newspaper UkrAINe

MoLoDoy bUkovINets Newspaper UkrAINe

tv2 toMsk television rUssIA

tv vIJestI television MoNteNegro

vIJestI Newspaper MoNteNegro

yAkUtsk veCHerNy Newspaper rUssIA

$84,475,005 totAL FINANCINg provIDeD

Page 52: MDLF First Fifteen Years

barack

obama

sworn in as

Us president

time Warner

spins off AoL

Former journalist Carlos

Mauricio Funes Cartagena

elected president of el

salvador, ending two

decades of AreNA party rule

south African

prosecutors drop

corruption case against

Jacob Zuma, who is

elected president

Morgan tsvangirai

sworn in as prime

minister of Zimbabwe’s

power-sharing

government

Us newspaper

industry collapses,

with widespread

bankruptcies and mass

layoffs of journalists

Copenhagen Climate

summit fails to

produce binding

agreement on reducing

carbon emissions

sri Lankan

journalist Lasantha

Wickramatunga

murdered, leaving article

predicting own death

50

2009

Page 53: MDLF First Fifteen Years

Above: New bolivian

constitution gives

greater rights to

indigenous majority

Mass protests erupt across

Iran in response to disputed

re-election of president

Ahmadinejad

Above: Abdullah Ahmad

badawi steps down as

Malaysian prime minister

and is replaced by deputy,

Najib Abdul razak

guatemalan

government

destabilized

by video of

murdered lawyer

Former peruvian president

Alberto Fujimori convicted

of human rights violations

and sentenced to 25 years

in prison

At least 30

journalists among

57 murdered in

ambush in southern

philippines

ALtApress Newspaper rUssIA

b92 television, radio, online serbIA

betA press News agency serbIA

ebArt Media archive serbIA

gLobAL voICes online gLobAL

MAIL & gUArDIAN Newspaper soUtH AFrICA

MeLItopoLskIe veDoMostI Newspaper UkrAINe

NeWsDAy Newspaper ZIMbAbWe

ok rADIo radio serbIA

pANCevAC press Newspaper serbIA

tv2 toMsk television rUssIA

tv vIJestI television MoNteNegro

vIJestI Newspaper MoNteNegro

vJ MoveMeNt online gLobAL

$94,772,002 totAL FINANCINg provIDeD

Page 54: MDLF First Fifteen Years

viktor yanukovych

elected president of

Ukraine

google shuts Chinese

site following attack

on e-mail accounts of

human rights activists

Massive earthquake leaves

more than 220,000 dead and

1 million homeless in Haiti

Iraq holds second

parliamentary

elections since

ousting of saddam

Hussein

Apple announces

release of ipad

52FI

rst

QUA

rter

oF

2010

Page 55: MDLF First Fifteen Years

Dozens of military

officers arrested over

alleged “sledgehammer”

plot to overthrow

turkish government

plane crash over russia

kills polish president Lech

kaczynski and 95 others,

including dozens of senior

military and political leaders

Former guatemalan

president Alfonso portillo

arrested and extradited to

Us on money-laundering

charges

ALtApress Newspaper rUssIA

kbr68H radio network INDoNesIA

tv vIJestI television MoNteNegro

pANCevAC press Newspaper serbIA

UJyAALo 90 NetWork radio network NepAL

vJ MoveMeNt online gLobAL

$97,144,220 totAL FINANCINg provIDeD

Page 56: MDLF First Fifteen Years

It was 1998, a time when new media were truly new, the dot-com

bubble was still bubbling, and the news-media industry was just starting

to figure out what to do with the “information super-highway” and

other jargon of the era. Millions were being burned on half-baked

ideas and money was being made on concocting ways in which new

technologies could be put to use in publishing and broadcasting.

that year, MDLF created the Center for Advanced Media − prague

(CAMp) as its new-media arm, based on the idea that independent

journalism, which rarely has millions to spend on expensive technology

projects, could greatly benefit from the revolution that was truly hap-

pening underneath the multilayered hype.

Its goal was to create cost-effective solutions that used new

technologies in a way that levelled the playing field for independent

media. In other words, to find a way or make one.

the original idea was to use cheap commercially available hardware

and software, sometimes with groundbreaking initial results (such

as in the case of Indonesia’s kbr68H radio network). but we soon

found out that even these had their limits.

A good example is online payments. the phnom penh post contacted

us about the difficulties they were having in selling subscriptions

to their magazine online. At the time, it was nearly impossible for

companies outside of the Us and Western europe to accept credit card

transactions. so we hired programmers and created the Digital kiosk

transactions service (http://digitalkiosk.mdlf.org) to handle credit

card processing. between May 1999 and February 2010, the service

processed $505,143 of revenue on behalf of some twenty media

organizations in developing democracies – revenue they probably

would not have had otherwise.

CAMpWAre opeN soUrCe tooLs For oNLINe MeDIA

As CAMp ventured into ever more complex projects, we began to real-

ize that there were very few commercial solutions that catered to the

needs of non-Western media. Many of the needs involved language

support and localization, and narrow-minded technology companies

considered their markets uninteresting and therefore did not develop

proper support – as anyone who has had to use Cyrillic or right-to-left

text can attest.

We looked toward the budding open source movement, which was

interesting to us for a couple of reasons. open source means that

the programming code is freely available and that anyone can both

use it and modify it free of charge, but when we looked for solutions

immediately applicable to news media, there just weren’t too many

out there.

In 1999, a highly regarded print magazine covering post-Communist

countries, transitions, was ceasing publication on paper. but they

made a bold decision, one that at the time was considered by many

to be foolhardy. they wanted to go online-only, and came to us to

either find a way or make one. We examined what already existed

and couldn’t find a single commercial or open source solution that

would fit their needs. What they wanted was a simple and flexible

tool that would enable regular journalists to publish on the Web in any

language without relying on technical personnel.

transitions online (www.tol.org) launched in 1999, and the multilin-

gual system that we developed to power it, later renamed Campsite,

was released to the public as free and open source software in March

2001. Campsite had a number of technical innovations, including sup-

port for Unicode, easy translation of the software into any language,

and a journalist-friendly online text editor.

Coinciding with Campsite’s release, we launched the Campware Initia-

tive (www.campware.org) as an umbrella for all of CAMp’s software

development activities. the reasoning was simple: Whenever we made

a software solution as part of our technical support work, that solution

would also be made generally available at no cost. Modifications would

not only be tolerated but actively encouraged, because a key portion of

open source licenses requires that changes to the software be shared

with the original creator. In practice, this means that improvements

made for one newspaper can be shared with all of the software’s users.

our guiding idea was that software developed and distributed under

the Campware initiative should be user-centric, i.e. built explicitly for

the end user. the logic of short learning curves and non-mystifying

interfaces, first embodied in Campsite, was carried over into all of its

subsequent products: the Cream customer relationship management

CAMp: Find a way or make one

CeN

ter

For A

DvAN

CeD

MeD

IA p

rAg

Ue

54

Page 57: MDLF First Fifteen Years

software for newspapers, the Campcaster radio automation solution,

and the Dream newspaper distribution management software.

the open source development model has enabled CAMp to leverage

a total of $650,000 of donor investment over ten years into software

source code that would cost more than $14 million to produce in a

commercial setting.*

Campware’s software is now in use by more than 100 news media

organizations worldwide, including guatemala’s elperiódico

(www.elperiodico.com.gt), the first Arabic independent online radio

station, Ammannet (www.ammannet.net), Latin America’s first online-

only newspaper, el salvador’s el Faro (www.elfaro.net), switzerland’s

groundbreaking community-generated national radio station

openbroadcast (openbroadcast.ch), Croatia’s legendary Feral tribune

(www.feral.hr), the award-winning transitions online (www.tol.org),

and european radio for belarus (www.euradio.fm).

CoNCeptUAL, teCHNICAL, AND FINANCIAL sUpport

since its inception, CAMp has implemented or helped kick-start more

than 70 new media projects worldwide, from peru to bosnia, Nepal

to belarus. Its groundbreaking projects have included Internet- and

satellite-based radio networks (Indonesia, Nepal, Armenia, russia,

Angola, peru, Jordan/palestinian Autonomous territory), sustainable

online publishing (Malaysia, south Africa, bosnia, Croatia, serbia and

Montenegro, Macedonia, Czech republic, georgia, belarus), as well

as targeted Internet infrastructure investment (serbia and Croatia).

From 2000 to 2007, CAMp was in charge of MDLF’s two new-media

grant pools totalling $1.25 million, rigorously selecting candidates

and providing tools and consulting for the projects, often beyond the

duration of the respective grant periods. projects benefiting from this

program included print and broadcast media in eighteen countries.

LArge-sCALe INFrAstrUCtUre proJeCts

From 2003 to 2006, CAMp implemented a large-scale online publishing

project in the balkans together with the swedish Helsinki Committee

for Human rights. the three-year Media on the Web project created

a model of a sustainable Web publishing platform for independent

media by providing centralized hosting, developing a standardized

set of open source Campware tools, and offering ongoing consulting

and support by CAMp’s local implementation team. the results of the

project were exceptional. More than forty local newspapers and radio

stations were given conceptually mature, high-quality websites based

on Campsite, often superior to their commercial or state-owned peers.

experience gained in the Media on the Web project enabled CAMp

to start up a similar project in belarus. the project, which has already

provided services to more than a dozen media organizations in the

country, was successfully transferred to our local partner in 2009.

UNLoCkINg tHe NeXt LeveL

In recent years it became increasingly obvious that if CAMp and

Campware were to achieve a greater degree of visibility and

popularity, new organizational and financial models were necessary.

Now, twelve years after its founding, CAMp is getting ready for

independent operation.

Leveraging CAMp’s impressive track record, MDLF succeeded in

finding a strategic partner in late 2009 for spinning off CAMp and

the Campware initiative. A new prague-based non-profit organization

will be set to carry on the CAMp and Campware legacy to a whole

new level.

* source code value quoted is based on the CoCoMo method estimates by ohloh.net

for Campsite, Campcaster, and Cream software code.

Page 58: MDLF First Fifteen Years

Central sumba – an underdeveloped region in eastern Indonesia,

a two-hour flight from Jakarta – has a unique megalithic culture,

one to which water buffalo are central. there is virtually no ritual,

be it marriage, a ceremony for a new building, or, especially, a

funeral, that can be conducted without the slaughter of a water

buffalo. because of their central role in sumba’s deeply traditional

society, water buffalo are often the target of thieves. In this remote

area, animal rustling is a social ill that has plagued the population

for years. one night last year, residents of one village sensed that

thieves were on the prowl. someone called radio gogali, the

area’s new community radio station, alerting it to the thieves.

the station responded quickly, broadcasting news of the suspected

location of the gang. Immediately people rushed out of their homes

and started to block off roads around the village. the gang was

captured. Animal rustling had been halted by the actions of a

community radio station.

radio gogali started broadcasting in February 2009. this

community radio station was set up by an association of members

of the local population, with the assistance of radio news agency

kbr68H and non-profit ppMN, and with funding from the Dutch

government, managed by MDLF. the initiative to establish the

station came from Ngo activists who felt the need for local media

in their area. prior to radio gogali, the people of Central sumba

had no reliable information supply. Newspapers from Jakarta

arrived a week after publication, while television news could only

be enjoyed by the tiny minority who had not only electricity but

also a satellite dish. the existence of a radio station was a long-

awaited dream. ”before, if we needed to deliver information we

had to rely on it being passed on from mouth to mouth. Now we

have radio gogali,” said the regent of Central sumba. the station

now brings information, entertainment, and education to 70,000

people living in the area.

ending the isolation

56

solar panels power the

station built in paniai

in papua’s Central

Highlands

A radio presenter at radio

Arisca in Calang, Aceh,

an area devastated by the

December 2004 tsunami

traditional customs and

beliefs are strong in the

mountains of papua

representatives of MDLF,

kbr68H, and ppMN, together

with the radio gogali team

in Central sumba

the Central Highlands

of papua are home to

some of the most isolated

communities in the world

INDo

Nes

IAN

rAD

Io

Page 59: MDLF First Fifteen Years

Central sumba is not alone: 150 regencies are recognized as

underdeveloped and lack any kind of local media. they are also

often short of basic services, such as electricity. As a result, in its

efforts to extend information access, kbr68H often has to consider

how to provide an alternative energy source. In Central sumba, we

installed solar panels, as we did in paniai in papua. In yahukimo,

also in papua, we built a micro-hydro system.

the opportunity to build community radio stations opened up

after authoritarian rule ended in 1998. this reform era bought

with it freedom of opinion and expression along with media

freedom. In the pre-reform era, private radio stations were not

allowed to produce their own news programs. Instead, they had to

relay news produced by government radio. today that requirement

is no more and the right to set up community radio is recognized.

As a result, the sector has seen very rapid development. before

1998 there were only around 700 radio stations nationwide; today

there are more than 2,600. the need for radio in underdeveloped

parts of the country is considerable but has become even greater

due to decentralization, with parts of existing regencies breaking

away to become regencies in their own right, often without

sufficient resources.

since 2003, kbr68H has helped to set up stations in these

locations, especially in the eastern provinces of Maluku, papua,

and east Nusa tenggara. so far, we have built nine stations there,

in addition to the dozens of stations we have helped to build or

rebuild in areas hit by natural disasters, such as Aceh post-tsunami

and yogyakarta post-earthquake.

the building of radio stations in isolated locations is part of

kbr68H’s mission. We do this in the belief that the free flow of

information must also be equitable, extending to those living in

poverty in remote areas. through adequate access to information

radio pikon Ane:

ending isolation in the

mountains of papua

sixty per cent of

children in Central

sumba never finish

primary school

the official opening

of radio Arisca in

Calang, Aceh

schoolgirls in Central

sumba enjoy a break

from class

Page 60: MDLF First Fifteen Years

we believe that societies will be better able to resolve their

problems. this is highly important for Indonesian society, which is

in a transition to a more meaningful democracy and a social order

that is more open and dignified. It is not right that in an era of

technological development there remain parts of the country cut

off from information access.

to establish radio stations in underdeveloped locations, we rely

heavily on local initiators. It is they who at first need to be mentored,

to be empowered, so they can become capable of building and man-

aging a station over the long term. Finding those initiators is a vital

task. We have to be convinced that the local team shares our view

of media as a tool for public service, and not for other purposes.

After the core team is formed, we provide basic training on managing

a station, related to programming, technical aspects, and marketing.

this is done in the place where the station will be built in order to

maximize the number of people who can participate. Under certain

circumstances, we also invite the managers of these stations to

undertake internships at kbr68H. As well as developing the capacity

of the station’s personnel, kbr68H also facilitates the physical build-

ing of the station, sending technicians to supervise construction. the

building work itself is usually the least complex part of the process.

this often surprises the initiators and the local community, who tend

to regard the building and equipping of a radio station as being

something way beyond their reach.

In the early years of the program, we set up the stations as locally

owned private companies. but more recently we have opted instead

for the community model, with ownership and management in the

hands of members of the local society. this has proven a more ef-

fective way of attracting broad public participation in the station,

as demonstrated by the case of radio pikon Ane in yahukimo, the

launch of which was attended by more than 5,000 people. some of

sumba is one of

the poorest islands

in the Indonesian

Archipelago

A water buffalo is led

in for sacrifice as part

of the launch of radio

gogali, Central sumba

Farming is the

primary occupation

in Central sumba

sumba has depended

on emergency aid

to stave off famines

due to crop failures

schoolchildren await

the official opening

of radio gogali in

Central sumba

INDo

Nes

IAN

rAD

Io

Page 61: MDLF First Fifteen Years

rADIo bINAyA Masohi MALUkU

rADIo DeFNAtAr tanimbar Islands MALUkU

rADIo gogALI Central sumba eAst NUsA teNggArA

rADIo MAtoA Manokwari West pApUA

rADIo MerbAU bintuni West pApUA

rADIo pIkoN ANe yahukimo pApUA

rADIo rANA buru Island MALUkU

rADIo tAvLUL tual MALUkU

rADIo WAgADAI paniai pApUA

them had walked for three days to witness the official opening of

their beloved station.

Community radio is also more suited to isolated locations, where

the potential for generating advertising income is minimal.

Whatever type of ownership is chosen, we always emphasize the

importance of long-term sustainability. kbr68H provides support to

these stations for up to three years, after which they are financially

fully self-reliant. In many places where we have helped to set up

radio stations, they are the only form of mass communication

available. It is not surprising, therefore, that they often play an

unusual role. radio gogali foiled water buffalo thieves; radio

pikon Ane encouraged farmers to arrange a schedule for selling

their crops at market, resulting in higher prices for their produce.

the local government also uses these stations to disseminate

development messages.

As members of the kbr68H network, these stations also become

a means of linking their listeners to the outside world – ending the

isolation of remote communities.

sANtoso

Director, kbr68H

pHotos CoUrtesy oF ppMN, kbr68H, tessA pIper, AND MArNIC

A school that reopened

after months of closure

thanks to radio pikon

Ane in yahukimo, papua

the crew of radio

Wagadai in paniai,

in the remote Central

Highlands of papua

Five thousand people

walked for hours and even

days to attend the launch

of radio pikon Ane

Page 62: MDLF First Fifteen Years

60

peo

pLe

Page 63: MDLF First Fifteen Years

IN MeMory oF

stUArt C. AUerbACH

1935–2003

Co-founder & first Chair of MDLF

Page 64: MDLF First Fifteen Years

thank you to all our investors and contributors who have made the past fifteen years possible, including:

62

bank vontobel

Calvert social Investment Foundation

Charles stewart Mott Foundation

Council of europe

DoeN Foundation

Dreilinden ggmbH

eurasia Foundation

Foundation for Democracy and Media

Alexej Fulmek

David Haas

International Media support

J. M. kaplan Fund

John D. and Catherine t. MacArthur Foundation

Netherlands Ministry of Foreign Affairs

open society Initiative for West Africa

open society Institute

oxfam Novib

swedish Helsinki Committee for Human rights

swedish International Development Cooperation Agency (sIDA)

swiss Agency for Development and Cooperation

United Nations Development program (UNDp)

Us Department of state, bureau of Democracy, Human rights & Labor

World Association of Newspapers and News publishers

All our Free press Investment Note and voncert responsAbility Media Development investors

INve

sto

rs &

Co

Ntr

IbU

tors

Page 65: MDLF First Fifteen Years

CUrreNt MeMbers:

bernard poulet (Chair)

ying Chan

sheila Coronel

Annette Laborey

gerald Nagler

Aryeh Neier

Alexander papachristou

John ryle

saša vucinic

prevIoUs MeMbers:

kenneth Anderson (Chair 1997–2009)

stuart Auerbach (Chair 1996–1997)

roberto eisenmann

konstanty gebert

Jan Urban

boArD oF DIreCtors

Page 66: MDLF First Fifteen Years

64

MDLF New york

37 West 20th street, suite 801

New york, Ny 10011, UsA

phone 1.212.807.1304

Fax 1.212.807.0540

MDLF prague

salvatorska 10

110 00 prague 1, Czech republic

phone 420.224.312.832

Fax 420.224.315.419

Warsaw satellite office

ul. Leczycka 4, Apt. #3

02 065 Warsaw, poland

phone 48.22.823.91.34

Fax 48.22.658.33.54

Moscow Liaison office

(operated by MDLF service Corp.)

28 tsvetnoi bulvar, str. 1

Moscow 127051, russia

phone 7.503.730.5301

Fax 7.503.730.5302

oFFICes

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Page 68: MDLF First Fifteen Years