TBY talks to Nuri Çolakoğlu, President of Doğan Media International, on Turkey’s appeal as a place to invest, the entertainment industry, and predictions for the future of the telecommunications sector.
TBY How would you evaluate the climate for international investors in the media sector?
NURİ ÇOLAKOĞLU Robert Maxwell and Rupert Murdoch came to Turkey way back in the 1980s during the Özal era. They wanted to buy one of TRT’s channels at the time, but the legislation was not there, so they could not obtain permission. Now, of course, Murdoch has an empire that stretches from Australia to the US. In that context, Turkey is very appealing as it is the 15th or 16th biggest economy in the world with advertising revenues on the rise every year. However, despite annual growth in advertising revenues of about 30%, total ad spend is still small at some 0.3% of GDP, especially when compared to the 1.5%-2% seen in the EU. This means that media revenues could increase five to seven fold. Therefore, it is a very appealing investment area.
Which areas of the media will be growth areas?
Unfortunately, newspapers are a dying brand. Newspapers are still alive because they are content creators, and as long as they keep providing content for television and radio they will survive. However, I do not expect more than one or two decades lifespan for newspapers. Therefore, the most interesting areas are television and the entertainment industry, such as video games. In terms of ad spend, internet and outdoor advertising seem to be the fastest growing sub-segments. When you look at the demographics, eventually those people who have not had much involvement with the internet will die, and the new internet-savvy generation will replace them.
To what extent does Turkish entertainment have an impact on the region?
Turkey is trying to be a role model for the region and, of course, Turkish drama series have an enormous impact on that. They are introducing a new way of life, and a new approach for women—working women, and women who have personal freedom. Turkish television series are now being run in at least 43 different markets, from Central Asia to the Atlantic coast. The whole Balkan region also watches Turkish television. It creates a circle of affinity. In the early stages of Turkish television we had Mexican, Argentinean, and Brazilian dramas, which were far closer to the hearts of Turks than US series. The characters were much more Turkish. This is now how Turkish series are being exported, and that is how Turkey is making money. When the private channels started up in 1990, we had enormous difficulty in trying to put together one drama series. It was a big adventure. Now, producers are churning out about 20-25 episodes of various drama series every week. It has become a very, very big industry in that respect, and the Turkish drama stars get the treatment of mega stars like Tom Cruise or Angelina Jolie when they travel anywhere in the region.
How does this play into Doğan’s strategy to become a big player in the international market?
Doğan is investing quite a lot in these drama series, and as they are very successful right now in the Turkish television industry; their success helps to promote this type of product. Doğan is getting more and more into this area. It has its special arm, D Productions, which is solely dealing in this area, producing, selling, and exporting. It is a very strong asset for Doğan in that respect.
What will be the hot topics on the Turkish news agenda in the years to come?
As always in Turkey, the most important topic on the agenda will be the Kurdish question. That has to be addressed properly, and the right planning and execution is needed to get this settled. Secondly, regional links will be of utmost importance due to the significance of the region in which Turkey finds itself. Turkey cannot remain an island of stability forever, and the problems of the region need to be solved. Thirdly, we have to see how this economic crisis in Europe will be solved, and how Turkey’s relations with the EU will develop. In the past, the EU was the ideal target for Turkey. Now, due to inefficient economic and political policies, Europe has started to lose its appeal in the eyes of the Turks. Around 10 years ago, 75% of the public supported accession to the bloc. Now, this figure is considerably lower. Therefore, I believe the EU has to tidy up its operations, and we have to wait and see what sort of leadership will emerge in Europe, because the current leaders are short sighted and are concentrating more on local political games, which is costing Europe a lot.
© The Business Year