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The Debate on Media Concentration in Peru

Jorge Acevedo. Professor at the Pontifical Catholic University of Peru.

April, 2014.

Versión en español | Versão em Português

In November 2013 a group of journalists brought an appeal on grounds of violation of rights and liberties asking the Supreme Court of Justice of Lima to nullify the buying transaction of 54% of the Peruvian National Newspaper Enterprise (EPENSA) by Grupo El Comercio (The Commerce Group). This purchase allows the group to control close to 80% of the press market in terms of readership and attraction of advertising investment by means of several magazines and nine newspapers: El Comercio, Peru.21, Trome, Gestión, Depor, Ojo, Correo, Ajá, and El Bocón. The editorial influence of El Comercio widens through the national channels América Televisión (America Television), in open signal, and Canal N (Channel N), in cable, in a scheme of cross-ownership.

        These journalists consider the acquisition as a concentration contravening the Constitutional mandate that forbids media monopolization, since according to the 61st Article: “The State facilitates and monitors free competition. It fights any practice that tries to limit competition, as well as the abuse of dominance or monopolization. No law or agreement can authorize or establish monopolies. Press, radio, television and every other media of expression or social communication, and in general the enterprises, goods and services related to freedom of expression and communication cannot be the subject of exclusivity, monopoly or hoarding, directly or indirectly, by the State or any private individuals.”

        The transaction, occurred in August 2013, prompted a hot debate on media concentration levels in Peru and their consequences on the exercise of freedom of expression, political and cultural diversity in the public space. This is because, with it, a single commercial group will have the possibility to control the agenda of information and public opinion. Even the Legal Defense Institute of Peru went on March 24 to the public hearing of the 150th period of sessions of the Inter-American Commission on Human Rights in Washington to expose the consequences of media concentration.

        Some figures may give us a better idea of the production and distribution capacity of journalistic contents that El Comercio acquires with the purchasing transaction. It is estimated that the group would exceed one million and a half copies per day. Taking into account that between three and five people have access to a copy of a newspaper, the group’s influence would reach at least four millions and a half people. Talking about open television, El Comercio has (by means of América Televisión) participation in about a third part of the national audience, and a similar level of participation in terms of the attraction of advertisement investment in television, which was estimated in 320 million dollars. América Televisión shares its leadership in the open signal with ATV group and Frecuencia Latina (Latin Frequency).

        Even when El Comercio has no participation in the radio market as stockholder in one of the most important groups of the sector, there is a small number of companies dominating the market: Corporación Radial del Peru (Radio Corporation of Peru), RPP —owner too of a news channel in cable—, and Corporación Universal (Universal Corporation), a group with provincial origin. Most radio stations with national coverage broadcast music. However, two of the dominant groups have informative radios: Radioprogramas and Capital, for the RPP, and Exitosa, for the Corporación Universal.

        In this way, there is a quasi monopoly in the press market whose principal player is a conglomerate, for even beyond its branches in open and cable television, it participates in other sectors of economy like those of construction and air transportation. Likewise, the controlling interest of few players in television and radio (three in each case) gives shape to oligopolistic ownership and power structures, which form an economic interest group that without clear rules can establish relevant limitations to competitiveness.

        During the last months a series of prominent individuals like President Ollanta Humala and the Nobel Prize winner Mario Vargas Llosa have declared themselves against the purchase. They claim that media concentration in a few hands endangers freedom of expression and democracy itself. Meanwhile, the supporters of such concentration declare that the market’s conditions must allow the entrepreneurial exercise of press activity, and that any kind of State intervention is a limitation to freedom of expression. Álvaro Vargas Llosa, son of the Nobel Prize winner, is of that opinion.

        Debate has led to the necessity of setting a regulatory framework to put an end to media concentration. For that reason, a range of civil society organizations who specialize on the defense of the right to communication (Calandria, Artesanos de la Comunicación [Communication Artisans], AMARC ALC, WACC, RED TV [TV Net], among others) have organized the Right to Communication Forum, a body to be involved in debate and putting forward proposals for a more plural and decentralized communication. At the same time, The Popular Action-Broad Front Parlamentary group has begun a series of public hearings on the topic with the purpose of getting ready a draft law.

        While the process develops, there is also need to wait for the resolution of the justice system regarding the journalists’ appeal, which states the necessity to settle the debate on the plurality of informative media, concentration and monopolizing, which confronts freedom of expression and freedom to information with limitations on entrepreneurial freedom and contractual freedom.

        Its results will set a relevant precedent because there are no competition regulatory organs on the sector in Peru. For that reason there is neither a policy that regulates mergers between media firms to avoid concentrations that affect not only effective competition, but also plurality of opinions. This should also include cross ownership in a multi-platform environment as a product of digital convergence.

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