Russian media holdings continue to supply content to Europe and the USA

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VGTRK media holding, despite the geopolitical situation, continues to conclude deals to sell the rights to its projects in the West. So, in the US, VGTRK names Amazon Prime as the main partner, which is preparing to include the Elizabeth series in the catalog. No countries have introduced direct general bans on the demonstration of the content of Russian media holdings, lawyers say. They believe that settlements with partners go through intermediaries in Armenia, Kazakhstan, Turkey and the United Arab Emirates. But market participants admit that, in general, the volume of content distribution from Russia abroad has significantly decreased over the year.

“Kommersant” got acquainted with the report on the activities of the Federal State Unitary Enterprise “All-Russian State Television and Radio Broadcasting Company” (VGTRK) following the results of 2022, published at the end of June on the website of the Ministry of Digital Development. It follows from it that after the outbreak of hostilities in Ukraine, the holding developed cooperation with the regions of Asia, the Middle East and Latin America, where “purchasing power is undoubtedly lower.” But at the same time, according to the concluded agreements, the projects continued to be broadcast in Poland, Germany, Austria, France, Great Britain, USA, Canada, Australia and New Zealand.

The State Television of Poland (TVP) acquired the rights to the project “On the Edge”, MTVA (Hungary) – to the television series “Elizaveta”, “Quiet Flows the Don”, “Zuleikha opens her eyes”, the American Olympusat – to a package of series from the premium content catalog (“Ekaterina Pretenders”, “Godunov”, “Bad weather”, “On the edge”, “Optimists”, etc.). In the US, the main partner of the holding is Amazon Prime, “the television series Elizabeth is being prepared for inclusion in the service catalog” (Amazon Prime left Russia after Netflix and Megogo).

VGTRK combines the channels “Russia 1”, “Russia 24”, “Russia-Culture”, “Karusel”, the radio channels “Radio of Russia”, “Mayak”, “Vesti FM”, the online platform “Look” and the site “Vesti.ru “. FSUE revenue in 2022 amounted to 23.5 billion rubles, with a loss of 1.4 billion rubles. A year earlier, revenue amounted to 30 billion rubles. with a net profit of 1.5 billion rubles. In December 2022, the EU imposed sanctions against VGTRK and a number of other Russian media holdings.

The report clarifies that a number of major transactions were nevertheless frozen: the supply of the television series “Optimists. Caribbean Crisis” for BBC Alba (Scotland) and SBS on Demand (Australia), TV series “Elizaveta” and feature film “Elsa’s Land” for RTVS (Slovakia), series package including “Zuleikha opens her eyes”, “Dostoevsky”, “Godunov ”,“ Terrible ”for Prima TV (Romania). China’s CCTV (China Central Television) has suspended a deal to buy the rights to the documentary Russia. Recent History”.

The All-Russian State Television and Radio Broadcasting Company in the report notes that due to the withdrawal of Chinese TV channels and Internet platforms from the air of all foreign programs, many shows, including the planned premiere of the series “Ekaterina. Impostors”, postponed by a year: “All content produced outside of China must undergo a new government censorship procedure.” According to Finam FG analyst Leonid Delitsyn, the total lost revenue from all the listed series, transactions for which were frozen, can be estimated at 300 million rubles.

It is likely that deals to transfer rights to European channels were made before the introduction of restrictions, Mergen Doraev, a partner at the EMPP Law Office, believes. The sanctions primarily affected broadcasting and the work of film crews, there were no direct bans on the demonstration of content from media holdings, says Yury Fedyukin, managing partner at Enterprise Legal Solutions. Only the methods of settlement with the copyright holder are questionable, the expert believes: “There may be a chain of intermediaries to whom VGTRK transfers the rights to content, and they conclude agreements with local broadcasters.” Most likely, these are companies in Armenia, Kazakhstan, Turkey, the United Arab Emirates, the interlocutor of Kommersant in the industry adds.

The total volume of content distribution from Russia abroad has decreased, says Alexandra Modestova, General Director of Expocontent, but this does not mean that demand for it has fallen: “The restrictions imposed cannot terminate the relationships that the film industry has been building with foreign partners for many years.” According to her, Russian projects are usually sold for a long time: “Including fresh content, they sell it so that it lies on the shelf and is shown later.” The key sales regions have always been Asia, Latin America, the MENA countries (UAE, Saudi Arabia, Qatar, Egypt, Algeria) and the CIS, Ms Modestova clarifies: sales and not cut ties, Russian companies are dumping on prices.”

Julia Yurasova

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