Chile's Newspaper Duopoly Tightens Its Grip
Chile's Newspaper Duopoly Tightens Its Grip
Thu Jul 11,11:45 AM ET

By Louise Egan

SANTIAGO, Chile (Reuters) - Juan Jaque, a Chilean newspaper vendor for the past 20 years, gestures impatiently to a newspaper hanging from his busy Santiago newsstand. "We're sickening our minds with this stuff," he says.

Jaque is referring to El Mercurio, the country's oldest and most influential newspaper. "These are all a waste of time," he continues in disgust, pointing to the array of papers.

Most are owned by two groups that have dominated Chile's print media for the past 30 years and that have strong ties to the country's conservative business elite.

Jaque is not the only one who feels this way.

"The concentration of ownership is brutal. The written press is perhaps the only media where there is no diversity of ideas," sociologist and media consultant Guillermo Sunkel told Reuters. "But I think that is going to change."

But many of Chile's 16 million citizens are yearning for change and supporting an unprecedented boom in small, independent media. In the last two years, at least 10 newspapers, both print and electronic, have been born.

The duopoly in the Andean nation's newspaper industry dates back to 1973, when ex-dictator Augusto Pinochet ( news - web sites) outlawed all newspapers except El Mercurio, run by the Edwards family, and La Tercera, owned by the Copesa consortium.

Both were Chilean-owned and espoused editorial views in support of Pinochet's free-market economic policies and the social values of the most conservative wing of the Catholic Church.

Now the papers, still very conservative, have an ax to grind with the center-left government in power.

With 20 publications nationwide and 90 percent of newspaper advertising revenues, the Edwards Group and Copesa have a tight grip on the newspaper market and have waged advertising price wars against new players trying to gain a foothold.

La Nacion, majority state-owned, holds a distant third place with 1.4 percent of total advertising investment.

MISERABLE FAILURE

The latest business that tried to challenge the top two -- IberoAmerican Media Holdings, owned by Venezuela's Cisneros Group -- failed miserably. After two troubled years in circulation, its daily newspaper El Metropolitano folded last month, snuffing out hopes by Chileans like Jaque and Sunkel that it would provide some fresh editorial input on the newsstands.

Few details have emerged about El Metropolitano's collapse. But its demise was widely mourned as a loss for freedom of speech and democracy in Chile, where the traditional papers are seen as mouthpieces of business and right-wing political parties.

"The arrival of foreign companies would bring a great benefit because there's an ideological monopoly that is very conservative in the sense of being retrograde, Catholic, economic neoliberalism mixed with Opus Dei, basically everything that the military government was," said Sunkel, referring to Pinochet's iron-fisted rule between 1973 and 1990.

El Metropolitano's exit leaves one large multinational and several small, independent papers still trying to squeeze into the stifled print media market.

Swedish publisher Metro International is the first foreign firm to get a foothold in Chile, nabbing 7 percent share of newspaper advertising in its first two-and-a-half years in the country.

Metro has launched papers in over 20 cities worldwide but its only Latin American foray is in Chile. It gives away its "Publimetro" tabloid newspaper outside subway stations.

"We have surpassed the demands of shareholders. Already this year we are seeing profits in the majority of months and we expect to be better than breaking even in the third year, which is the benchmark that investors demand," CEO Pablo Mazzei told Reuters in an interview.

But a diverse collection of new print and electronic outlets for writers of news and editorials is enabling Chileans to hear other voices.

OPUS GAY

"Opus Gay" is the latest creation to hit the newsstands, poking fun at the ultra-conservative wing of the Roman Catholic Church Opus Dei, which has many members in Chile.

Jaque, the chain-smoking vendor, has his bets on "The Clinic." "We could say that this paper has a future," he beams, holding up a copy of the tabloid, by far the most popular of the new batch of papers. Named after the London Clinic where Pinochet was arrested in 1998 on human rights charges, its irreverent humor and political lampooning was previously unheard of in Chile and earned it a massive following.

Another fledgling paper "La Huella" or "Fingerprint" sports a blaring headline "The Anarchists are Coming." Its well-researched articles portray the growing ranks of rebellious youth who feel marginalized by Chile's political leaders. They include the over one million people who either abstained from the 1999 presidential election or spoiled their ballots in protest.

"We're convinced that the more communications media there are, the more we are really exercising democracy," said La Huella founder Manuel Salazar.

But why this renaissance now and not a decade ago when Chile returned to democracy after 17 years of military rule?

Experts say its a mixture of a newfound entrepreneurial spirit among journalists, helped by electronic technology, and frustration with the powers that be.

"There is a growing disillusionment among Chileans not only with conservative groups but with the apparent complacency of the center-left groups in power for the past 12 years, explains La Huella founder Manuel Salazar.

While the small papers strive to introduce dissident opinions, the job of challenging El Mercurio and Copesa on business terms is left to bigger companies.

Spanish media giant Grupo Prisa, owners of El Pais newspaper, is interested in buying La Nacion, according to Chilean media reports. Prisa confirmed to Reuters it aims to expand in Latin America but would not comment on specific plans.

Nobody knows for sure if and when Chile's newspaper empire will crumble but all agree on one thing, the change will be welcome.

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