In Turkey, media is not a business, it is a business unit. Most media companies are subsidiaries of much larger corporations and function as a marketing and business development department for the parent company. Every major newspaper or tv channel is owned by a conglomerate operating in various sectors. These conglomerates get contracts from the government, be it in mining, construction, infrastructure or energy, and they use their ‘media arm’ to promote the government interest and win support for it from the public. In return for the promotion, the government awards the contracts to the conglomerates. Thus, the media arm of the conglomerate helps expand the business.
Asymmetric rewards and punishment: The reward for supporting the government could be business contracts but the punishment for not supporting it is NOT ‘no contracts’; it is getting tax fines and possibly facing bankruptcy. Thus, the choice for media bosses is unquestioning support for the government or bankruptcy. Unsurprisingly, they all chose the former.
So separate the media and the businesses…problem solved. Not quite. Before the 2001 crisis, the situation was very similar. All media bosses also owned banks. These banks were speculators in the bond markets. They took in deposits from households and invested heavily in Turkish Treasury bonds which were offering three digit interest rates. Their media arms were used to make everything in Turkish economy look rosy. When the crisis hit in 2001, the newly set up banking watchdog (BRSA) prohibited bank bosses to own media companies. The law was passed but never implemented. To this day, NTV – one of the largest news stations – is owned by Dogus Holding the largest shareholder of Garanti Bank – Turkey’s largest private bank. There are always deliberate loopholes in the law for exception handling.
But marketing departments are cost – not profit – centers…thus when a company needs to reduce headcount they usually turn to the marketing department. It is no different in media. While there is very little published data on newspaper profits, I suspect most newspapers make losses. It is a burden which the conglomerate discounts as the cost of doing business. But when the conglomerates are not in good shape, the first place to look for extra savings is the media company. The story of Sabah newspaper – top five selling newspaper in Turkey – is the most telling one on this issue. Sabah was established and owned by Dinc Bilgin, a man who built a media empire in the 1990’s. In 2005, Ciner Holding who mostly operated in the mining sector bought the newspaper. Two years later when Ciner Holding faced financial difficulties, the newspaper was sold to Calik Holding who mostly operated in textiles and energy. Recently, due to Calik’s financial difficulties the newspaper was taken over by a group of companies who are all close to PM Erdogan. Ciner and Calik would know how expensive a marketing department media really is. For Ciner, Calik and the group of companies who recently bought Sabah, the purchase of the newspaper is merely a bribe, a tax, or a down payment for getting contracts for other businesses.
Basics of the Turkish newspaper business (unit): Three pages and three corresponding concepts make or break a newspaper in Turkey; football (second to last page), sex (images of half-naked celebrities on the last page) and blood (the most bizarre crime news on the third page). Turkish people scan the first page (politics) but it is not what sells. As for columns, in a country where the average education is 5.5 years, few spend their scarce resources on reading long articles about political views. The ones that do are mostly liberals and are a minority. Only a small minority switches newspapers when they realize the political news content is not accurate or biased. As the sales data suggests, reader loyalty is extremely high in Turkey. The oppressed pathology of the Turkish people leads us to accept what we read without questioning. Result? A newspaper might change hands, its political views might change but its readership remains the same and the reader’s perception of events is shaped by the new owner’s interest. It’s no surprise that support for AKP is closely correlated with pro-Erdogan newspaper sales.
Political alignment of the newspapers: There are four types of newspapers in Turkey; pro-Gulen, opposition, pro-Erdogan and swing.
a) Pro-Gulen: Zaman is the most selling newspaper (23% market share) and is publicly known to be the media arm of the Gulen foundation. While most claim that Zaman’s sales volumes do not adequately reflect its readership, we have no way of verifying this. Bugun (3.5%) is also a Gulen aligned newspaper although it is owned by gold mining mongrel. Total Gulenist newspapers have a 27% market share.
b) Opposition: These newspapers can be aligned with the opposition (center left or nationalists) or claim to be independent. Cumhuriyet (1.7%) is clearly aligned with the CHP – the main opposition party – while Taraf (2.3%) seems to be independent of any political organization. Sozcu (8.5%) also claims to be free of politics and clearly has been in opposition to Erdogan. However, this recently-founded newspaper’s sudden rise to success with its young boss, who is rumored to be a Gulenist, raises some eyebrow’s about its self-proclaimed independence. Total opposition newspaper market share is roughly 13%.
c) Pro-Erdogan: Of the dedicated Erdoganists, most notable ones are Sabah (7.7%), Haberturk (5.3%), Milliyet (4.1%), Turkiye (4.0%), Star (3.3%), Yeni Safak (2.9%), Vatan (2.8%), Takvim (3.4%) and Yeni Akit (1.6%). While Sabah, Milliyet and Vatan have in the past been against Erdogan (when Erdogan was the mayor of Istanbul), having changed hands multiple times, nothing remains of those old papers. Milliyet and Vatan under Dogan holding ownership tried to be unbiased but having been acquired by Demiroren Holding – an ally of Erdogan – in 2011, they have become forced Erdoganists. Aksam (3.2%) and Gunes (3.1%) having recently been acquired by a group close to Erdogan are also late comers to the party. In all, Erdoganist newspapers make up 41% of newspaper sales.
d) Swing: Any newspaper of Dogan Holding can be classified as a swing newspaper. These newspapers – currently, Hurriyet (9.4%), Posta (9.1%) and Radikal (1.4%) – first helped Erdogan into power in 2002. When Erdogan grew too strong, Dogan pulled his support before the March 2009 municipal elections. PM Erdogan and Aydin Dogan – then CEO of Dogan – had a public spat about media independence. Shortly after, Dogan Holding was charged with an USD3.7bn tax fine. Aydin Dogan stepped down and Dogan Holding newspapers once more switched to the Erdogan camp. After the corruption allegation charges against AKP ministers and Erdogan himself in December 2013, Dogan once more switched to the opposition. Dogan Holding has about 19% share in total newspaper sales in Turkey.
Figure 1: Newspaper sales (% total, Jan 2014)
Source: Publishing Institute, 2014.
Figure 2: Summary table – newspaper and owners (click to expand)
Source: Newspaper websites, 2014. Note: Pro-Gulen newspaper color coded in blue, opposition in orange, Pro-Erdogan in green and swing in pink.
Erdogan’s rise to power through the media: When Erdogan first came to power in late 2002, he understood that majority of the public was against him and his Islamic-rooted party. At the time his party’s share of votes was 34% while most of his voters had switched as a reaction to the older parties that led Turkey from one economic crisis to another one. To change public perception, he desperately needed the media. His first stance towards media was of a compromising nature. He stuck to his end of the bargain with Turkey’s liberal bosses including the media and completed the IMF deal despite being against it personally. The IMF deal helped Turkey onto a stable economic platform. Towards the end of his first tenure, however, his stance changed. He no longer wanted to be at the mercy of the ‘liberal’ and ‘secular’ media bosses who never trusted him. So he set out to establish his own media empire.
It began with Sabah which was sold to Calik Holding in 2007. Calik Holding had made a fortune working in partnership with Erdogan and Sabah’s takeover by Calik gave Erdogan an outlet to his first mainstream newspaper. At the time Sabah was Turkey’s one of top selling newspaper and had been relatively independent. Upon takeover by Calik, the staff was reshuffled, the liberal columnists got fired or were forced to resign and Sabah became a propaganda machine for Erdogan. Zaman owned by the religious Imam Gulen was already supporting Erdogan and was giving a major backing to his cause. In 2009, a pro-Erdogan businessman bought over Star newspaper while in 2011 Demiroren’s acquisition of Milliyet and Vatan from Dogan Holding gave another mainstream outlet to Erdogan. Finally, in 2013, Aksam and Gunes were both acquired by pro-Erdogan groups to give Erdogan an unprecedented power in shaping public opinion. By May 2013, almost 80% of the newspaper published, in one way or another, willingly or unwillingly, supported Erdogan.
Figure 3: Share of newspaper sales by political view (% total)
Source: Publishing Institute, 2014.
What newspaper sales say about the next elections? Shortly after the Gezi Park protests in May/June 2013, Gulen pulled his support from Erdogan. By December 2013, Gulenist newspaper visibly changed their stance to become an opposition to Erdogan. This was the opportunity that Dogan was waiting for to go back to its anti-Erdogan stance. Dogan secretly harbored anti-Erdogan sentiment since 2009 and was probably waiting for the right time to pull out. Finally, Gezi Park protests was a wakeup call to the liberals to stop buying biased news which led a slight boost to the opposition newspaper sales.
As of February 2014, pro-Erdogan newspaper share is down to 41%. To Erdogan’s advantage, the remaining 60%’s effort is mainly to undermine Erdogan and they are not supporting any one party or candidate against Erdogan. It is likely that pro-Erdogan newspapers share also reflect AKP’s vote in the upcoming municipal elections. In the short term, thanks to the fragmented state of the opposition and opposition parties’ lack of agreement to join power, Erdogan will most likely continue to be the most powerful man in Turkey.
In the medium term, the system is clearly unsustainable. Recently leaked tapes show Erdogan making calls to a media boss to change the content of the broadcast. Going forward, Erdogan is likely to find such micromanagement to be extremely difficult. Something’s gotta give. Only time will show whether it will be declining support for Erdogan or rising authoritarianism in Turkey.
Figure 4: Share of newspaper sales by political view (% total)
Source: Publishing Institute, Election Board, various polls, 2014. Note: Figure 3 includes pro-Gulen newspapers and certain Dogan Newspapers as pro-Erdogan until May 2013.