DELFI shareholder: Dictatorial propaganda has taught us to value freedom of press

One of Estonia's richest people and shareholder of DELFI, one of the biggest media groups in the Baltics, Hans Luik shares stories about getting into the media industry, doing business in Ukraine and challenges to free media raised by dictatorial governments as well as technological advances.
Hans Luik
© DELFI / Šarūnas Mažeika

"Sometimes I am asking myself: if new media, particularly Twitter and other social media, are restricting dialogue to 144-character messages, how can complicated topics be discussed? For instance, the topic of nuclear power for Lithuania - I cannot imagine that you can cover this theme with a video or a tweet. News graphic will add to quality journalism. But does social media? Does video? To conclude: I might sound old-fashioned, but clear written texts with graphics and embedded videos are still the most meaningful carriers of human thought. It is too early to abandon text," says Luik in an exclusive interview to DELFI.

In 2007, you invested into DELFI and it was quite an expensive purchase – it still is the most expensive media transaction in the Baltic history. Do you consider it a successful investment?

I do indeed. Our company, Ekspress Grupp, was a publisher of magazines and newspapers with no future. We were profitable but not digital. I decided that we'd better take a big loan to dive into the digital future. Nobody knew that we were simultaneously diving into an international financial crisis.

As for today, we have recovered the loan. Meanwhile, I had to bring my personal guarantees and pledge my belongings in order to secure bank loans for the DELFI purchase. But we are number-one digital news company in the Baltics.

It was a forced situation with DELFI in 2007. DELFI belonged to an American fund called Texas Pacific. They had a 5-year investment horizon, and their five years came to an end. So in 2007 they were selling - either to us or our competitors.

There were a lot of interested parties: Norwegians, who started 15 Minutes afterwards, and Finnish publishers. At the time, when we paid over 50 million euros to Texas Pacific, they chose to invest into a real estate company called Washington Mutual. The financial crises began and Washington Mutual went bankrupt with a huge investment from Texas Pacific. It seems that big money made nobody happy in times of crisis...

Last year, the result of Ekspress Grupp was close to 9 million EBITDA profit. So the risk has been worthwile.

It has not been an all-lucky trip. The thing I regret is DELFI Ukraine. We had great expectations and we kept on investing for years. Editors and IT people from Lithuania and Estonia were helping to support DELFI in Kiev. But there is an oligarchic structure of Ukrainian media market with lots of middlemen. For an outsider, it was too hard to gain foothold in the advertising market. We made the hard decision to close down in Kiev.

Talking about innovation, we believe that there will be less direct mail in our postboxes, because it is not very accurately targeted advertising. We want to take information about retail discounts digital, at our new website Zave.lt. We already have 60 Lithuanian retailers drawn to our idea.

Today, online media face high expectations for both speed and quality. What are the strengths and weaknesses in such an environment? What transformations have Baltic online media gone through in recent years?

Today's trends are video and mobile. I am a little bit worried about the speed of our audiences catching up with these trends. Why am I worried? Because as our news go to the mobile platform, our advertisers are not so keen on using video and/or mobile solutions. Because advertisers are only beginning to use video and mobile advertising formats.

What concerns quality, it is important that news media lead the discussion of essential topics in the society. Sometimes I am asking myself: if new media, particularly Twitter and other social media, are restricting dialogue to 144-character messages, how can complicated topics be discussed? For instance, the topic of nuclear power for Lithuania - I cannot imagine that you can cover this theme with a video or a tweet. News graphics will add to quality journalism. But does social media? Does video? To conclude: I might sound old-fashioned but clear written texts with graphics and embedded videos are still the most meaningful carriers of human thought. It is too early to abandon text.

As to speed: of course, DELFI has ambitions to be the first to carry news in Vilnius, Riga and Tallinn (and even for Polish population in Lithuania and Poland when it comes to news from Vilnius; and even readers for Russia, who are specially keen on visiting rus.Delfi.lt and rus.Delfi.lv for honest information). I believe we produce close to 500 items of news, videos, photos and other content per day in every country we operate in.

But if you measure the kind of news which is most popular with our readers, you see the same patterns - people go and check the weather, news about Russia's aggression in Ukraine and sports, plus maybe something about the lives of popular "stars". So it is a mix of informing and entertaining.

DELFI shareholder: Dictatorial propaganda has taught us to value freedom of press
© DELFI.lv

In recent years, DELFI in Estonia tended to let itself be carried away towards lighter and more entertaining news. This was due to strong competition. In Lithuania, as much as I can tell, DELFI is more serious and oriented to quality news. Also, Lithuanian video production at DELFI TV is the strongest in all the Baltic states.

In Estonia, we decided to merge our daily newspaper Eesti Päevaleht editorial staff with DELFI. This serves to provide DELFI with investigative journalists and quality news. And also, to keep our newspaper alive. Our competitors meanwhile have closed two newspapers: LT and 15 Minutes in Lithuania. Delfi.lt last year incorporated Lithuanian magazines Panelė, Cosmopolitan, /.../ in order to bring more variety to our digital readers.

How do you see the mission of professional media in the world of technologies and social networks? What are the biggest challenges that journalists face today? Social networks dictate the agenda for professional media: what impact could this eventually have for news media?

I feel we have seen the hype of social media as well as internet comments. It becomes more clear to the reader that balanced and truthful information is seldom produced outside of editorial organisations. Comments have their value as reflections of the general mood of the people. So do social networks. But I hope people learn how not to get carried away by the nervous speed of digital world.

In Estonia, it happened just recently that our minister of finance posted some foolish comments on Facebook and had to step down. Was it worthwhile? He was our best minister of finance for years. Similarly, the Estonian president got into nasty tweet war with Nobel Economy Prize winner Paul Krugman. Maybe writing a balanced opinion article would have shown our president in a better light.

Journalists must become better and better in data search. In controlling and combining sources. We see at DELFI that we are also becoming a large computing company - understanding and measuring our readers, offering exact audiences for advertisers. Delfi.lt is excelling in this sense.

As to journalists - to my mind, the biggest challenge for a journalist is to be involved in real life and not get all information from the internet only. Also, the activities of government and political parties might not be the most vivid and dynamic part of our life. After all, we live in liberal free societies where talented people build their own lives regardless of what the government does or does not. At times of stagnation in political economy in Europe, interesting things happen outside governments - in technology, arts, export business, nature.

So journalists should not limit themselves only to elite white-collar sources, but also be able to do field reporting, talk to various people.

The Kremlin's aggression in Ukraine raised many challenges for the Baltic societies and media. How do you see the mission of media in this sensitive and even dangerous situation?

It was a complete shock when state-owned channels in Russia began to tell outright lies about what was happening in Ukraine. It is terrible to see commentators and reporters with university education selling their souls to dictatorship. I am happy that DELFI was able to provide a safe haven for liberal Moscow journalists who were kicked out of Lenta.ru office last year - we created a place called spektr.delfi.lv for them and we get quite a lot of traffic from Russia.

We can also see that the information war has reached DELFI readers' comments sections. It cannot be true that an overwhelming majorities of local Russian-speaking population in the Baltics are supporting a "sovereign democratic system" where previous president names the next president, as has happened in the Kremlin during this century.

But as we still are a democratic media platform, we try to mediate comments, not to shut them down. There are voices who a righteously critical towards our governments - we are not going to deprive our Russian co-citizens of their right to express their points of view. We just have do differentiate whether it is their views or it is some propaganda platoon in Smolensk writing evil comments.

You were the one who suggested to have a reporter in Ukraine for DELFI group and even proposed to cover these costs personally. Why do you consider this to be a good investment?

It is terrible to have war in Europe. But under the circumstances, politicians are not free in their choice of words. President Poroshenko or even many European politicians are not calling a war a war. So, free media have to do it. It is also important to give an objective picture to our readers about what is happening in territories occupied by the Russian Federation or separatist. Cronyism, confiscation of property, clans with ties to Russia in power, loss of democracy.

It is also quite urgent to bring the fact to our politicians that Ukrainian forces cannot win their battles with 25-35-year-old arms as their Eastern enemy is using new powerful up-to-date weapons. It will be easier for our politicians to decide if they get accurate information about Ukraine from the biggest news site, DELFI.

How should the Baltic states protect themselves form a flow of Kremlin propaganda coming on a massive scale? How could they reduce the impact of such propaganda on their ethnic minorities?

There are values that we need to stress. In Lithuania, Latvia and Estonia people are equal by definition. It must not make any difference who belongs to whose family or has ties to some powerful mogul. We must evaluate people on the basis of their skill and knowledge.

It is Christian to help those in need, particularly talented young people from poor families, to have their chance in life.

The idea of democracy is to change government from time to time. Some representatives of ethnic minorities do not support the idea of democratic government; there is a strong belief, for instance, that Russian voters could vote for an even more militant president than Vladimir Putin. But this fear comes from a lack of democratic tradition. So we must develop and protect our freedom in order to provide an example that people's votes do count.

Finally, I want to stress that freedom of press has gained much more value over the last year because of such contrasts we see between dictatorial type of propaganda and free journalism. It is the tradition of DELFI to respect freedom of our editorial staff to choose the best ways to present the truth.

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