text by: Zselyke Csaky

To those following international politics, Hungary’s democratic breakdown of the past decade has been highly symbolic, representing both the end of the liberal hegemony of the post-Cold War order and the rise of anti-liberal strongmen. Prime Minister Viktor Orban has centralized power and put the country’s institutions into the service of his party, achieving unparalleled political domination.

But this domination would not have been possible without the help of government propaganda and the media. Taming critical coverage, squeezing independent outlets, and capturing the media market have been instrumental in achieving and maintaining the stifling control that the governing party has over politics and much of public life in Hungary.

What does this media capture look like in practice and what should we expect in the coming year and beyond? And what can those caring about media freedom in Poland learn from the Hungarian case?

Laws matter. Or not so much?

Contrary to most expectations, the legal system has been deployed sparingly against journalists since Fidesz came to power. Journalists are targeted in defamation cases from time to time, but the outright legal harassment that we see in some other countries is missing. The so-called media laws, an extensive package muzzling the press and restricting critical coverage, were all over the news in 2010 and 2011 but slowly faded from attention afterwards. This was primarily because Orban employed his favorite tactic, the now well-known “peacock dance,” and made concessions to the European Union only to smuggle certain restrictions back in later.

Despite these concessions, the overhaul resulted in a regulatory system that is captured by the government. Control over the press is centralized in the hands of a politically loyal media authority with broad prerogatives to regulate, including the power to hand out crippling fines. Still, apart from some instances of pressure, we have yet to see this authority make full use of its powers.

Advertising is king

Instead, the ruling party has decided to go with a more insidious method to subjugate the press. It has harnessed the unfavorable economic and financial conditions the media found itself in much of the region—and globally—in the 2010s, turning them to its advantage. As most outlets struggled to find a profitable business model, the government started dumping advertising money into friendly media. At the beginning, advertising by state-owned firms was used primarily for signaling; it demonstrated that an outlet is “safe,” that private advertisers should feel free to spend money there in the uncertain business climate.

But as time went by, government spending started to comprise a growing share of the advertising pie, distorting the market and constituting a large enough chunk to make or break outlets. In 2019, government spending made up 12 percent of the ad market as a whole—an increase of 500 percent from a decade earlier. This money has been used to prop up friends and to reward loyal cadres, keeping media afloat that otherwise would not have been able to survive on the market. Figyelo and Magyar Idok, two pro-government papers, demonstrate this relationship well; in 2018, government advertising comprised 80 to 90 percent of their respective total ad revenue.

The market no longer exists

Between 2014 and 2018, businessmen loyal to the government also acquired significant stakes on the market and refashioned several outlets as pro-government mouthpieces. In some cases, such as with the leading left-wing daily Nepszabadsag, the new owners went as far as to shutter the paper altogether, while in other cases we saw new outlets appear out of thin air. The optics didn’t matter either—the acquisitions sometimes took place with the help of state-owned banks, clearly signaling to all potential investors that the playing field is tilted.

As a result, in 2020, investing in the media without the government’s approval and support seems foolish, if not straight-up suicidal. While pockets of competition remain and profitability is still an important factor in the broadcast sector, when it comes to print—and to a significant extent online—the owner’s political loyalties matter more. The media market, just as the regulatory authorities, has been captured by the state.

Propaganda media empire

Nothing demonstrates this better than KESMA, the nonprofit media juggernaut combining most of the pro-government press, around 500 brands. KESMA came into being after years of acquisitions. At the end of the acquisition spree, in late 2018, government-friendly businessmen were simply asked to donate their outlets to the conglomerate for free—a shocking admission that they had never been the real owners to begin with.

The move has completed the creation of a vast pro-government media empire that can spew out propaganda just as efficiently as it can be turned into a ruthless weapon against critics. Together with the public media—which reaches fewer people than its counterparts in most neighboring countries but has access to massive and ever-increasing funding—this machinery repeats the agenda set by the government communications office and shapes public discourse to an enormous extent.

There is still independent reporting, but…

Still, there are a number of outlets, mostly online, that do quality journalism and reach a significant portion of society. The difficulty these outlets face—besides the non-trivial fear of a potential takeover—lies in scaling up their resources and impact. Newsrooms, not unlike in other parts of the world, have been bleeding staff for the past decade, making it challenging to chase in-depth stories and investigations. But in Hungary this problem is exacerbated by a lack of access to information—it is not rare for freedom of information requests to be enforced only after a court decision, sometimes years after the fact.

And when journalists do get the information and publish important stories, they have to overcome government propaganda, which has polluted the public discourse to such an extent that it drowns out any substantive discussion.

What’s next?

It is clear that the current situation benefits the government enormously. The few remaining independent outlets can be held up as “tokens” when the party wants to burnish its democratic credentials (though fewer and fewer people seem to buy it anymore); they are also useful for letting out steam. The public media and other pro-government outlets can continue to spew out propaganda—though, despite enormous funding, they have been producing low-quality, often cringe-inducing materials. In the next few years, therefore, the best-case scenario for the government would allow it to maintain the status quo but professionalize its propaganda empire.

The government can, of course, also decide to deploy legal tools to keep critics in check. This might mean tightening the screws further and designating journalists as the new enemy, especially if the steam runs out of its current campaign focusing on migrants and NGOs. Similar to the NGO law, this could result in taking cues from Russia and declaring journalists foreign agents. However, given the continued benefits the government reaps from the status quo, this seems an unlikely, although not completely implausible, scenario.

At the same time, there are steps that independent outlets could themselves take to increase their resilience. The percentage of those paying for news online in Hungary is very low, even in comparison to other countries in the region. There are already signs that this is changing, and some outlets are moving towards targeted paywalled options.

It is, of course, a difficult balancing act in an information-starved environment, but if the major online outlets manage to transition to a business model that relies primarily on audience revenue, they would benefit tremendously and could also trigger some positive societal changes. While hard to imagine at the moment, this is a scenario that could lay the groundwork for more sustainable, better quality media—and the possibility of political change—in the long term.

What can Poland learn?

The most important takeaway of the Hungarian case for media markets that are at risk of political or oligarchic capture, including in Poland, is that ownership and societal support matters. Polish media are in much better shape than Hungarian—they are more diverse, subscription numbers are much higher, and ultimately there is a big enough market that outlets can operate according to market principles even today. But as the increasing role of state advertising shows (in some pro-government outlets accounting for up to half of their revenue), there is a rearrangement underway.

Should the government embark on its long-planned “re-Polonization,” there is a risk that the delicate balance will shift overnight and that outlets will have to scramble to maintain their independence. What Polish media can learn from the Hungarian case is that—while there is no magic bullet in the face of pressure—diversifying revenue streams and keeping readership engaged provide the best protection against a hostile government.

Zselyke Csaky is the Research Director for Europe and Eurasia and works on Nations in Transit, Freedom House’s annual survey of democracy from Central Europe to Central Asia. She is also a fellow at Centre for Media, Democracy and Society at Central European University.