Time Warner tunes into Czech television market

US film, television and print media giant Time Warner has bought itself a prime part in the Czech commercial television market. Time Warner has taken a 31 percent stake in Central European Media Enterprises (CME), which owns the country’s most watched tv station, Nova. But what does the latest turn in the Nova ownership saga and US acquisition mean?

Time Warner’s investment into CME, which groups US millionaire Ronald Lauder’s tv station investments in seven Central European Countries including the Czech Republic, comes against a backdrop of a cash crunch at the glitzy commercial stations.

The financial crisis has hit advertising spending hard. CME has warned that first quarter revenues could almost halve compared with a year ago with such gloomy predictions helping Time Warner make what is seen as a bargain buy at 241.5 million dollars.

The deal should now help Nova to make the switch to the upcoming digital multi-channel Czech tv environment and give it prime access to Time Warner’s valuable stock of films, says Atlantik Finanční Trhy analyst, Patrick Vyroubal.

“Currently there is a shift to digital broadcasting. There could be more channels and therefore CME and this cooperation with Time Warner would want to increase the number of channels and have their multi-channel strategy to strengthen their position on the market.”

Although Time Warner also owns the pay tv film channel, HBO, which also operates in the country, Mr Vyroubal believes Czech viewers should get some of the new digital delights for free.

“I do not see competition from HBO because it is a pay channel and TV Nova is a free to air channel. I do not know what type the new channels will be, but I expect some will be free to air.”

But does the deal signal the final chapters in the Czech tv saga of CME founder Ronald Lauder, who had to bought back control of the station following a bitter legal battle after it was snatched away from him by the station’s former director Vladimír Železný? That would not seem to be the case, for the moment at least. Time Warner has ceded its voting rights in CME to Mr Lauder for the next four years.