Estonian commercial TV channels exempted from licence fees

By Martin Aadamsoo
    The Estonian parliament has passed a bill exempting all TV broadcasters who relay digital programming from paying licence fees beginning January, 2009.

    The move primarily affects Estonia's two leading commercial channels TV3 and Kanal2, both owned by foreign capital. The move is seen as giving a further advantage to private channels in contrast to the public broadcaster ETV, which is struggling to finance the opening of its second channel next year. The public broadcaster's 2008 TV an radio budget is €12.5 million.

    The decision saves the commercial broadcasters €1.6 million each annually, which might be used to bolster acquisitions and widen the already existing ratings gap between commercial and public channels.

    The license fees were initially installed in 2001 as a compensation to the public broadcaster for ceasing the broadcast of commercials. Although the fees were meant to directly finance the public broadcaster, the link never quite worked that way, and the advertising revenues gained by commercial channels exceeded the license fees.

    The official reason for the exemption is to facilitate and promote earlier conversion to digital broadcasting prior to the EU mandated deadline. Critics, however, suspect lobbying to be the real drive behind the move, with politicians concerned about preferential treatment on airwaves ahead of the two upcoming elections in 2009.