Pact embarks on Russia mission amid tension, ad ban fears

UK producers association Pact will go ahead with a three-day trip to Russia amid political tensions between the country and the West and concerns an upcoming advertising ban could impact channels’ programming plans.

Pact enables its members connect with broadcasters and fellow production companies internationally with missions to trade fairs, including MIPCOM, and to countries including Brazil and China.

It has attended the Kiev Media Week event in recent years, allowing UK indies to connect with content companies from Ukraine and Russia.

The event will take place this year despite the ongoing tension in the country, but Pact has decided to head to Russia instead of attending, fearing the influential Russian broadcasters will not be in attendance.

“We’ve never done a trip to Russia before and usually head to Kiev for the Ukrainian content market,” Dawn McCarthy-Simpson, Pact’s director of international development (pictured), told TBI. “It is happening, but we’re not going this year. We went to target the Russian market in a sense and we don’t think the Russian broadcasters will be there.”

The UK Trade & Industry-backed event will see 18 indies head including Hat Trick, Zig Zag Productions and Argonon International to Russia from the UK.

Russia has implemented sanctions on some EU imports and the West has implemented a range of measures in protest at Russia’s actions in Ukraine, but the content business is, Pact says, so far unaffected.

“The British Embassy would be the first to know if there is any reason we should not be travelling to Russia and we’ve been reassured its business as usual,” McCarthy-Simpson said. “As far as the Russian market is concerned, it shows that we still want to trade and work there. We’re not taking any sides and [the mission] is us saying, ‘we still want to work with you’.”

The UK indies will be based in Moscow for the three-day trip, which will take place next month. McCarthy-Simpson said the British Embassy has assured Pact there are no safety concerns and has also helped with logistics and setting up meetings.

Concern remains, however, that the looming ban on pay TV advertising in Russia could impact programming budgets. “We are concerned about the pay TV advertising ban, which comes into force in January, and whether it will mean the big pay TV channels will withdraw or there is less funding to acquire,” McCarthy-Simpson said.

The ad ban, under the terms of which pay channels will be forbidden from carrying advertising in Russia from next year, has taken a new twist this week with the possibility of a workaround for some Russian channels.

It has emerged that Russian free-to-air channels that are advertising supported could be given must-carry status on pay TV platforms, under a new plan hatched by the country’s communications ministry.

The proposed ad ban would have included all channels that are available exclusively on a pay basis, as well as those that can only be accessed using a TV decoder, with the exception of national state-controlled channels.

However, deputy head of the ministry of communications Alexey Volin told business daily Kommersant yesterday that ad-supported channels that are free to subscribers should be guaranteed distribution at least in the Russian regions outside Moscow.

Volin said that the ministry planned to ban agreements where channels are charged for carriage, as well as arrangements where channels that carry advertising receive carriage fees – the model covered by the new amendment.

Volin told Kommersant that the guaranteed carriage arrangements are designed to give some protection to regional channels and channels that are part of the country’s second digital-terrestrial multiplex – Ren TV, CTC, Domashniy, Sport+, Zvezda, TNT, Muz TV, Spas and TV3.

Until now must-carry status has been extended only to the ten national channels including Perviyy Kanal, NTV and RTR. The pay TV advertising market was worth about RUB4 billion (US$11 billion) in 2013.