Cablegate: Kenya's Media: Part Iii- Media Houses and Cross Ownership


DE RUEHNR #2656/01 3561021
R 221020Z DEC 09



E.O. 12958: N/A
SUBJECT: Kenya's Media: Part III- Media Houses and Cross Ownership


1. (U) Summary. This is the third part of a four-part report on
the state of the Kenyan Media. The parts are: 1) Overview and the
new media law; 2) Radio Stations; 3) Media Houses and Cross
Ownership; and 4) Role of the media and New Trends. A handful of
media houses dominate and even manipulate the Kenyan Media.
Shunning media pluralism, these media houses wield enormous
influence over the Kenyan public through their "symbiotic"
relationship with the political elite. Despite the government's
attempt to remove irregularities including rampant media
concentration, many fear that well-protected media houses will
gradually absorb the smaller, regional stations which have limited
sources of revenue, leaving listeners with only two or three
sources for their news. End summary.


Media Moguls of Kenya


2. (SBU) After 40 years of an "open" market, a handful of media
houses have emerged to dominate the Kenyan media. They have
collectively share about 90 percent of the media audience.

--Nation Media Group: The single, most dominant media group,
Nation Media, is owned by the Aga Khan. The Daily Nation newspaper
is the Group's flagship outlet in Kenya. Nation Media also
publishes the Business Daily, a daily on business news and Taifa
Leo, a Kiswahili daily and the East African, a weekly. The Group's
broadcast side is represented by NTV and two radio stations - Easy
FM and Q FM. Nation Media's chief executive is Linus Gitahi, of
the Kikuyu tribe, and the managing editor is Joseph Odindo, of the
Luo tribe. The management of the Group is predominantly Kikuyu.
Recently, the former CEO of Nation Media and current chief advisor
of President Kibaki's Party of National Unity (PNU), Wilfred
Kiboro, was re-installed as a board member, a move which many see
as the PNU's attempt to ensure pro-PNU and possibly anti-reform
coverage as Kenya prepares for presidential elections in two years.
Kiboro, in turn, brought back Dennis Luanga, the man he groomed to
be the next Chief Executive during his 12-year tenure as CEO.
Kiboro never forgot the bitter defeat when Gitahi moved to the
position that was supposed to be "reserved" for his chosen
successor, Luanga. The open strife between Gitahi and Kiboro is
obvious to many and creating difficulties for the company. Some,
including Macharia Gaitho, Chairman of the Editors' Guild and
Nation columnist, say that this kind of bad business practices -
instituting a powerful PNU man to keep an eye on the paper - will
put the Nation behind more progressive and modern groups. Indeed,
we have noticed a sharp deterioration of the Nation's coverage of
the reform agenda, including U.S. Mission's active involvement with
civil society and youth activists. Nation Media runs NTV Uganda,
KFM radio station and publishes the Monitor and the Sunday Monitor
in Uganda, and also publishes Tanzania's leading Kiswahili
newspaper, Mwananchi, and English dally, the Citizen.

--Royal Media Services: The owner, Samuel Kamau (aka SK) Macharia,
is a shrewd businessman, who tends to stand outside rules and
regulations. He has weathered many legal battles and constantly
rumored to have business and political run-ins with his fast
shifting partners. Royal Media Services runs Citizen TV and its
vast network throughout Kenya and 22 FM stations. Citizen TV is
considered best for local content programming and known for the
best coverage of the reform agenda. Well connected to powerful
politicians of all factions, Macharia has enlarged his broadcast
empire by initiating the trend for vernacular stations. He is
reputed to have many "idle" frequencies for further expansion.
Macharia purchased U.S. equipment valued at about USD 500,000 7
years ago. He paid $6,000 at the time of purchase but has refused
to pay the difference, claiming that the purchased equipment was

confiscated by the then-Moi regime. EximBank has pursued him to
recover the amount owed but Macharia has no intention to pay back.
Macharia's many stations have a re-broadcast contract with the VOA
and carry VOA programs. Despite his unscrupulous business
practices, Macharia will continue to be a force to be reckoned with
because of his well-established reputation as the best local news
deliverer and unbeatable understanding of the Kenyan media market.

--Standard Group: The Standard Group belongs to former President
Moi and his business and political associates. It runs KTN TV, the
Standard Daily newspaper and Simba FM. It openly supported the
Orange Democratic Movement (ODM) party during/after the 2007
presidential elections. One single theme that the Standard Group
has focused on is its anti-PNU agenda with a goal of being a
leading critic of President Kibaki. Twice, the Kibaki family
protested against what it claimed to be "unfair" coverage by the
Group. In 2006, thugs suspected to be government (PNU) hires
raided KTN, dismantling and confiscating equipment. Since then,
the Standard Group has regularly played the role of a victim of
government media interference and harassment. The Group acquired
Simba FM station in February but has not yet retooled it. A
popular and well-spoken KTN talk-show hostess, Beatrice Marshall,
clearly understands the Group's direction and delivers anti-PNU
messages regularly.

--Radio Africa: Owned by Ghanaian Patrick Qurckoo and Kenyan
Kiprono Kittony (of the Kalenjin tribe), the Radio Africa Group
runs six FM stations, two TV stations and publishes a daily, the
Star. Popular Classic FM, KISS FM, XFM, Smooth FM and Jambo FM all
belong to the Radio Africa Group. It owns 42 frequencies and plans
to expand to use up "idle" frequencies in the near future. Known
to be master of radio broadcasting, and savvy and timely business
decisions, Radio Africa is one of the most powerful media house in


New Kid on the Block and Old Stand-bys


3. (SBU) New Merger by the Kenyatta family: In September, 2009, a
new merger emerged, combining K-24 TV, Kameme FM station and the
People's Daily. K-24 and Kameme were previously owned by
journalist-turned businesswoman, Rose Kimotho, while the People's
Daily was owned by a veteran politician Kenneth Matiba. The
Kenyatta family is believed to be the new investor. Kiprono
Kittony, Chairman of the Radio Africa Group, said, the Kenyatta
connection is "factually true but legally untrue," because as in
many cases in Kenya, Uhuru Kenyatta's name does not appear in any
of the legal documents of the merger. According to Rose Kimotho,
who will continue to manage K-24 and Kameme FM, K-24 will expand
and go national before the end of the year. The new group which
has an aggressive expansion plan to claim its share of the media
market will give Uhuru Kenyatta a direct control over three media
-- newspaper, radio and television. The purchase was to give the
family bigger space in the political arena through systematic media
campaign. Kenyatta also owns a strangely stale STV, which relies
mostly on Al Jazeera TV.

4. (SBU) Alternative Press: During the one-party era in the 90s,
when mainstream media were under siege, it was the alternative
press -- known as the gutter press -- that Kenyans heavily relied
on to catch a glimpse of the Kenyan political system. It was the
source of stories and scandals the mainstream largely avoided
publishing. Daring to criticize the one-party regime, the gutter
press was often harassed, intimidated, and charged in court.
Charges included incitement, sedition, and causing alarm and
despondency. Frequently, printing equipment was confiscated by the
government's security agents.

5. (SBU) Examples of gutter publications that were at the
forefront of democratization included Society Magazine, edited by
Pius Nyamora who took refuge in the United States; Nairobi Law
Monthly edited by human rights lawyer Gitobu Imanya (now a member
of parliament); and Njehu Gatabaki's Finance magazine. The Law
Monthly and Society are now defunct, partly because of the pressure
from the government and expenses incurred by court cases.

6. (SBU) Even today, the gutter press is popular in streets in
Kenyan urban centers. These low-cost publications focus on
half-baked stories about politics and lives of prominent Kenyans.
Unlicensed to publish in most cases, they are still subject to
frequent police raids and defamation charges by targeted
politicians. Presently, the most sensational publication of the
gutter press is the Weekly Citizen whose investigative stories have
often led to police raids on its editorial bureaus and some of its
writers are on the run to avoid arrest.


Cross Ownership: Curse or Blessing?


7. (SBU) Many believe that the Kenyan media is controlled and even
"manipulated" by a small number of wealthy and well-connected
people. The media owners maintain that their hard work and
business know-how put them ahead of the curve and see no damaging
effect of a small group owning multiple media outlets across
different forms of media (called media cross ownership in Kenya).
They maintain that the situation was created by default, not by
design and cross ownership creates synergy and more economical way
in the media industry as many outlets could utilize the same set of
journalists for information gathering. They often cite that KTN
TV, the Standard Group's television station survived only because
of the profits from the Standard Daily, one of the two major
newspapers in Kenya that belong to the same group. Radio Africa
claims that its daily newspaper, the Star, was "resuscitated" by
the groups many lucrative FM stations. Some even argue that the
small advertisement market, totaling USD 270 million annually,
could not manage further "fragmentation," by allowing the entry of
small broadcasters into the market and cannot absorb more than the
handful media houses currently active in Kenya. They are also
quick to point out conspicuous cases of media concentration in the
West such as Sylvio Berlusconi in Italy and Ruppert Murdock in the


Perils Abound


8. (SBU) The government makes sporadic attempts to rein in the
media when they expose government wrongdoings too explicitly.
There are a multitude of libel cases pending against most major
media houses. The Standard Group alone has 200 cases. Minister of
Finance Uhuru Kenyatta clashed both with editors of the Nation and
the Standard. In May, he started a legal procedure against the
Nation over the "typing error" saga of the missing KSH 10 billion
from the budget. He has sued the Nation's cartoonist who drew a
series of caricatures based on the budget fiasco for libel. Uhuru
also sued the Standard Group for airing the Prime Minister's
statement alleging him to be the leader of Mungiki, an illegal
youth group accused of a series of violence. President Kibaki's
children filed a complaint against the Standard Group for
publishing statement that the president himself might have been

involved in the planning the government raid to the KTN. A long
list of MPs, cabinet ministers and heads of government agencies
implicated the media for their "unfair" and damaging coverage in
pending libel suits. In July, a Star journalist was detained for
his coverage of how the Kenyan Anti-Terrorism Police Unit lost
sensitive files on Fazul Mohammed, the terrorist who masterminded
the bombing of an Israeli hotel in Mombasa in 2002, and might have
been sold off.


Media Owners Association: Powerful Lot


9. (SBU) Sheila Amdany, Executive Secretary of the Media Owners'
Association, called the association, a "powerful lot which is not
genuinely interested in what is happening in Kenya but is skilled
to play the power game." Acquiring new freedoms in the 90s, the
media did not know how to use it and it is still learning the role
it should play for a transition society like Kenya, she added.
Generally speaking, the Kenyan media enjoy unbridled media freedom
until the recent media law and new regulations (reftel A). Most
media houses are driven either by an ambitious business model
(Radio Africa), as political platforms (Standard Group and the new
Kenyatta Group) or both (Nation Media and Royal Media Services).

10. (SBU) Despite the mounting number of court cases against
certain journalists by the government and political elite, powerful
media houses continue to thrive. Sometimes, media owners strike at
the political elite class with a highly visible media campaign. In
October, media owners accused MPs of spreading ethnic chauvinism in
the country, then turning their fury against the media when their
behavior is exposed by it. All major media reported the spat
between media owners and MPs. The Parliament's House of
Broadcasting Committee, in turn, accused media outlets for
"disseminating propaganda against MPs to the masses."




11. (SBU) Whenever the government tries to impose new controls on
the media industry, it is met with stiff resistance. The CCK, the
government body to be mandated to implement broadcast regulations,
does not appear to have the political support to take on the media
owners, especially those with the right political connections.
There is also no clear sign that the government is ready to
undertake any radical changes. The current media landscape where
competition is stifled and potential investors are turned away will
continue. An increasing concentration of news providers, some with
obvious political biases, could offset possibilities for greater
media pluralism.

© Scoop Media

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