FIRST PRIVATE TV STATION STARTS IN POLAND

By Published on .

Most Popular
WARSAW-In his new offices in an old bunkerlike building, 37-year-old Polish entrepreneur Zygmunt Solorz and his team are inundated by faxes and phone calls offering Poland's first private national TV channel everything from programming to help in selling ad space.

Piotr Nurowski, a director of Mr. Solorz's POLSAT company, excitedly proclaims to a visitor his new program acquisitions: "`Dallas!' Judith Krantz miniseries!"

Before winning the TV license in late January for POLSAT, Mr. Solorz, an import-export trader with no previous TV experience, became impatient with the government's slowness in awarding the franchise and got a foot in the door by starting a pirate satellite TV service in December 1992. In 1993, the government effectively legalized the pirate operation, now evolved into POLSAT, by granting a regional broadcast license.

Now he is part of the latest trend in Eastern Europe: private national TV channels that offer advertisers an alternative to state-owned TV monopolies. The Czech Republic's Nova channel started last month and even Russia has a limited private channel, NTV, launched in January. Only Hungary, still grappling with a new broadcasting bill, lags behind.

Marketers eager for more TV choice in Poland consider POLSAT's previous broadcast experience with the pirate channel, which carried a mininal amount of ads, a plus.

"Our official response is that we are looking forward to dealing with [POLSAT]," said Larry Allgaier, marketing director, Procter & Gamble Poland's health & beauty aids division. Last year P&G, one of the country's largest advertisers, spent an estimated $10 million to advertise its soaps, detergents and personal care products. "But it doesn't matter who it is, the important thing is that it's done."

The two competitive state-subsidized TV Polska channels going after the same advertisers and 38.5 million viewers are described as difficult to work with by frustrated agency media executives.

"What we have now is a situation where [state] TV is dictating to the agencies," said Jan Kalinowski, media director, DDB Needham. Mr. Kalinowski said TV Polska tries to shave ad agencies' commissions from 15% to 10% or even 5%. And when agencies come up with a creative media idea for a client, TV Polska offers the same deal to everyone.

Notoriously cheap Polish state TV is becoming less of a bargain, however. After price hikes at the two state channels of up to 140% in 1993, a 30-second spot ranges from $150 in early morning to $14,000 in prime time, and a new increase is promised for May. Estimates on the size of the increase vary: State TV is predicting 20% but some agencies believe it could go as high as 50%.

POLSAT executives are debating whether to develop their own fledgling ad department or hire an outside ad sales group to help draw up a ratecard and sell airtime. They are also hammering out details with the government on how much ad time will be allowed. The two state channels have a combined total of 70 ad minutes daily, grouped in several blocks throughout the day. POLSAT will be allowed to slot commercials during programs, an advantage for advertisers.

"They are reasonable people," said Ewa Brzozka, media buyer at Ogilvy & Mather Warsaw who has bought time on POLSAT for Warner-Lambert's Stimorol chewing gum.

The service will start making the transition from its current limited satellite service to national broadcasting in about six months, so no advertisers have signed up yet. But POLSAT already plans to offer services unavailable from state TV. This month, POLSAT will produce its first viewership survey, based on diaries of viewers from among the 10% of Polish homes that have access to the current limited POLSAT satellite fare of general entertainment, beamed in from The Netherlands.

When ad agencies ask Poland's state network for audience data, the network demands money to carry out the research, agency media execs said.

"Right now (TV in Poland) is like a menu, but with only two choices," said Zoran Vucinic, marketing director, Coca-Cola Poland. "With a new network we will be able to better target consumers."

POLSAT, with only $15 million of the $100 million it needs to operate, is looking at raising money on the stock market and taking a minority partner. Under Polish law, a foreign media partner can own up to 33% of the channel.

There is no shortage of candidates. Rupert Murdoch has expressed interest; Time Warner of the U.S., Germany's Bertelsmann, Luxembourg-based broadcaster CLT, Silvio Berlusconi's Fininvest and Sweden's Kennevik Media International were all among the losing bidders. But at this point it's hard to predict who, if anyone, POLSAT will team up with.

In this article: