Identifier
Created
Classification
Origin
09QUITO108
2009-02-11 20:33:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Quito
Cable title:  

COMMERCIAL MEDIA IN ECUADOR WORRIED ABOUT THE PRESIDENT AND

Tags:  PHUM PGOV KPAO EC 
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UNCLAS QUITO 000108 

SENSITIVE, SIPDIS

E.O. 12958: N/A
TAGS: PHUM PGOV KPAO EC
SUBJECT: COMMERCIAL MEDIA IN ECUADOR WORRIED ABOUT THE PRESIDENT AND
THE NEW CONSTITUTION

REFTEL: 08 QUITO 616
UNCLAS QUITO 000108

SENSITIVE, SIPDIS

E.O. 12958: N/A
TAGS: PHUM PGOV KPAO EC
SUBJECT: COMMERCIAL MEDIA IN ECUADOR WORRIED ABOUT THE PRESIDENT AND
THE NEW CONSTITUTION

REFTEL: 08 QUITO 616

1.(SBU) SUMMARY: Since President Rafael Correa came to office in
2007 he has criticized the Ecuadorian commercial media as
"incompetent," and complained that the majority of media outlets
were protective of the business interests of their owners and not
representative of the interests of Ecuadorian citizens. In 2008,
the government took management and editorial control of two national
TV stations owned by the Isaias family. Over the past year the
government has launched three "public" media outlets that in theory
report on the citizens' business, but in practice mainly report
favorably on government actions. The new constitution includes a
number of provisions that make commercial media outlets vulnerable
to government pressure. Taken together, President Correa's actions
and the provisions of the new constitution present a serious
challenge to Ecuadorian media and freedom of the press.
Nevertheless the main private media outlets continue to report on
and criticize the Correa government, while the public remains
largely on the sidelines of this battle over government restrictions
on press freedom in Ecuador. End Summary

CORREA COMES OUT SWINGING

2.(SBU) In his public statements and weekly radio addresses,
President Correa has been attacking media outlet owners and
criticizing the press and journalists for most of his time in
office. For example, he recently threatened to stop placing
government advertising in the daily newspaper El Universo and in his
2009 state of the union address asked, " How is it possible that the
largest newspaper in the country (El Universo) is owned by three
persons with fake businesses in the Cayman Islands, and that one of
Ecuador's TV stations (Teleamazonas) has reported seven years of
losses?" Media analysts have also criticized the Government's use
of a law allowing it to broadcast short programs on two or more
private TV stations to interrupt the popular "Contacto Directo"
morning news program on TV Ecuavisa. The Government spots defended
the Housing Minister against criticisms by Contacto Directo anchor
Carlos Vera, a constant critic of Correa. Many journalists
criticized the action as a transparent attack on one journalist
critical of the government.


3. (SBU) Over the past two years and three national elections,

Correa has attacked established elites in all fields, including the
media, to neutralize his potential critics. While his attacks have
not stopped media outlets and individual journalists from
criticizing him, they might have helped pave the way for a host of
anti-media provisions in the constitution. Also, some newsroom
editors admit they have softened their coverage of his
administration. After Correa said this month in Cuba that, "I'm
ready to fight the 80 percent of the Ecuadorian press that are
private companies and defend private interests and those of
political partisans," one top newspaper editor observed in his
column, "(Correa) remains convinced that the private media is
pernicious to society and must be limited."

ISAIAS CASE - ASSET RECOVERY OR MEDIA TAMPERING?


4. (SBU) In July 2008, the Ecuadorian government's Deposit Guaranty
Agency (Agencia de Garantia de Depositos - AGD) began to seize
companies and properties of brothers William and Roberto Isaias, a
move which garnered wide public approval. The GOE declared that
its objective was to sell the assets to pay back depositors who lost
money when the Isaias-owned Filanbanco went bankrupt in 1998,
leaving a $661 million loss. The AGD seized two broadcast TV
stations owned by the Isaias Group, Gamavision (since renamed
GamaTV) and TC Television, whose viewership figures tie them for the
number two spot among Ecuador's seven broadcast TV stations, and two
small cable TV channels. These channels are now owned and run by
AGD, which is supposedly determining their value with an eye to
selling them by April 2009. After taking managerial and editorial
control of the TV stations in November, the AGD-installed general
managers claimed they would not tamper with the stations' editorial
content, but eventually cancelled a number of programs which
included political commentary that sometimes was critical of
President Correa or his administration.

"PUBLIC" MEDIA OUTLETS - WORKING FOR THE PUBLIC, OR IN FAVOR OF THE
GOVERNMENT?


5. (SBU) Since coming to office, the Correa government has created
three government-funded media outlets: the El Telegrafo daily
newspaper; radio station Radio Publica de Ecuador; and TV station
Ecuador TV (ECTV). The editor of El Telegrafo said that the vision
for the newspaper is to follow the BBC model, which is to say it
will neither publish state propaganda nor function like a commercial
media outlet earning a profit, and the president's communication
secretary said the three government media outlets are "at the
service of the people and the nation, but not the government."

However, the focus of reporting for these public media outlets
appears to be on the government's activities and its political
agenda. For instance, ECTV broadcasts all presidential
announcements and his Saturday addresses to the nation and was the
only media outlet to travel with the President on his January 2009
trip to Cuba. When Radio Ecuador was launched weeks before the vote
to approve Ecuador's new constitution, its first interview was a
one-hour talk with President Correa and much of its subsequent
programming focused on the government's campaign in favor of the new
constitution.

NEW CONSTITUTIONAL PROVISIONS - WILL COMMERCIAL MEDIA SURVIVE? WILL
FREEDOM OF THE PRESS ENDURE?


6. (SBU) Ecuador's new constitution reflects President Correa's
promise to implement "Socialism of the 21st Century" by creating a
"system of social communication," among other provisions. It
contains a host of articles aimed at regulating the commercial
media, overseeing news content, and giving the government ownership
control of commercial media outlets. The ultimate effect that the
Constitution will have on the media and freedom of the press remains
unclear, as many provisions have not yet been implemented through
accompanying laws, but media observers point out that the government
will have powerful tools at its disposal to make fundamental changes
to how media companies do business and how they report the news.
They fear the Correa administration, in keeping with its attacks on
the commercial media over the past two years, will use these tools
to restrict the free circulation of ideas and punish its critics in
the commercial media. During the Constituent Assembly's debate on
media provisions, assembly member Pedro de la Cruz of the
government's Proud and Sovereign Fatherland (PAIS) movement, said,
"The government should share in media company profits to
redistribute wealth," while PAIS member Pilar Nunez said, "We are
asking (media companies)for verified information that is not
speculation."

Future Government Role in Commercial Media Ownership and Oversight


7. (SBU) Transitory Article 24 of the constitution stipulates that
the executive branch will appoint a commission to conduct an audit
of all TV and radio frequency licenses. Some wonder whether this
commission will conduct a witch hunt against outlets that criticize
the government and cancel their licenses. This would free up
licenses to award to new "community media" stations since the
constitution says the government will guarantee licenses for and
assist in the creation of community stations (Article 16). However,
85 percent of licenses are in private hands, only three percent
belong to community stations, and some cities have no available
frequencies. The presidential decree creating the commission
specifically states that it is to identify any monopolies or
oligopolies using the licenses. In his 2009 state of the union
address, Correa said, "Alternative media outlets will have to be
created."


8. (SBU) Article 312 states that financial businesses are prohibited
from controlling or investing in media outlets, while Transitory
Article 29 states that financial company stock holders must sell any
current ownership positions in media outlets by October 2011.
Recently Correa has claimed that TV station Teleamazonas, owned by
banker Fidel Egas and home to news anchor Jorge Ortiz, a frequent
Correa critic, is evading taxes. Egas' spokesman has said that he
will abide by the constitution and divest from Teleamazonas. In
2007 Ecuador had four large independent commercial TV stations.
Today, two of those are owned by the government, and the third will
have to be sold at a time when the country is facing an economic
downturn and the constitution bars foreigners from owning a majority
share of media outlets. This leads commentators to wonder if any
Ecuadorian investors will come forward to purchase these three
stations and continue their tradition of independent newscasts.


9. (SBU) Article 313 states that the government reserves the right
to administer, regulate, control and manage strategic sectors,
including the TV-radio spectrum. Article 315 states that the
government will create public companies to manage strategic sectors,
while Article 316 spells out that the government can allow mixed
public-private companies to participate in strategic sectors, or in
exceptional cases allow private-sector companies to do this.
Article 408 states that non-renewable natural resources, including
the TV-radio spectrum, are the inalienable property of the
government and that the government will share in the benefits of
using these resources in an amount not less than the companies that
exploit them. Considering that commercial TV and radio stations
receive licenses giving them the right to use the TV-radio spectrum
in their business operations, these articles raise the possibility
that the government will seek to manage TV and radio outlets and
share in the earnings of their operations.


10. (SBU) Article 384 stipulates that the law will define the

organization, functioning and forms of citizen participation in the
"system of social communication," which will assure the rights of
communication, information and freedom of expression, and strengthen
citizen participation. The system will be composed of public
institutions, and private, citizen and community actors who
voluntarily join it, and the government will formulate a public
communication policy. A published news story reports that Cuban
communications professor Jose Ignacio Lopez Vigil helped put this
article into the constitution in the last days of the constituent
assembly. Analysts are unsure how the government will use this
system to set communication policy and influence the news reporting
of private media outlets.

Will the Government Control the News?

11. (SBU) Article 18 states that all citizens have the right to
receive true and verified information without prior censorship.
Article 19 states that the law will regulate the content of the news
media's programming. Transitory Article 1 spells out that the
National Legislative Assembly, within 360 days of the new
constitution coming into force, will write a communications law.
Legal experts predict that the communications law will define the
form and function of the "system of social communication," and will
empower the Council of Citizen Participation and Social Control to
establish mechanisms to enforce the constitutional provisions
governing the media and freedom of press described in Articles
16-20. In this case, the members of this council would have the
ability to interpret the broad language of these articles (in
particular Articles 18-19) and the authority to choose what
enforcement actions to take against private media outlets that they
determine violated those articles. Some media professionals have
expressed worry that this council, which has been dubbed the "fifth
branch of government," could abuse its authority by selectively
bringing enforcement action against private media outlets thus
leading to intimidation and/or censorship of the press.


12. (SBU) In the first example of how the government plans to use
these articles to regulate the commercial media, on January 28 the
National Radio and TV Council (CONARTEL) responded to complaints
against programs broadcast by TV Ecuavisa and Teleamazonas by
decreeing that TV and radio stations which use polls or opinion
surveys in their broadcasts must "eliminate statements that attack a
person's honor, dignity and good name." Referring to the language
of Article 18, CONARTEL's decree states that stations must avoid
making "statements about facts and cases that are untrue or
unverified and cannot be subsequently verified by the citizens." In
response, one columnist wrote that this is part of a well thought
out plan by the government to limit free speech guided by the idea
that citizen power must regulate the press.


13. (SBU) COMMENT: President Correa's two-year campaign of
criticism against Ecuador's "mediocre" press corps and "so-called
free press" has helped him discredit the media as an opposition
force. With some justification, he has painted it as aligned with
the country's political and business elite and therefore an obstacle
to the change agenda of his citizen's revolution. While the private
media has shown solidarity in defending themselves against the
attacks and continues to report and comment critically on Correa and
his government, some have admitted to a degree of self-censorship
and most are wary of how the constitutional provisions described
above could affect their newsrooms and businesses. They also wonder
whether Correa's verbal attacks might escalate into concrete actions
such as tax investigations, which have already begun in the case of
Teleamazonas. With Correa's popularity rating around 70 percent two
years into his term, they might be calculating that now is not the
time to take him on. It appears the public is willing for the time
being to allow Correa to continue attacking the media, at least
while the existing commercial media outlets still function more or
less independently. However, it remains to be seen how the public
would react if the president's attacks and the constitutional
changes lead to a situation like in Venezuela, where few independent
media outlets remain, or if the system of social communication
promised in the new constitution proves to be nothing more than a
government-run press.

HODGES