Besieged Tycoon a Symbol of Russia’s Suppressed Media

The first night in the prison cell was the worst. Sometime in the darkness the Russian businessman opened his eyes suddenly, his mind a whirling panic, like a Tom Wolfe character on a downward spiral.

But for media proprietor Vladimir A. Gusinsky, this was worse than a novel. This was a Russian jail, and he was terrified. He was sure the authorities, whom he had so frequently criticized, could do whatever they pleased.

“I had this moment of inner weakness,” he recalled. “I looked around me, and, with all the sad experience and knowledge of Russian and Soviet history, I realized that no one knew when I would get out. Then I forced myself to fall asleep.”

The trials of Gusinsky have come to symbolize the threat to Russian media freedom. The owner of the only private nationwide television network, known for its critical coverage of the Kremlin, found himself behind bars for three days in July on embezzlement charges.

He fled Russia upon his release, but Spanish police seized him in December on an Interpol warrant. Now the 48-year-old magnate is under house arrest in his villa on the Spanish Riviera, struggling to avoid extradition to Moscow.

The staff of his Media-Most company in Moscow faces almost daily interrogations, searches or arrests in what looks like a concerted campaign of harassment--even as Russian President Vladimir V. Putin professes support for media freedom. A company spokesman reported another raid Friday as about 20 officials from the prosecutor general’s office searched the personnel and bookkeeping departments.

Gusinsky’s network, NTV, is rapidly approaching what he calls “a make-or-break moment.” It soon may fall under state control. Supporters warn that if the gas monopoly Gazprom, which is 38% state-owned, takes control of the network, it will be a decisive blow against media freedom and a serious setback for Russian democracy.

Gusinsky is holed up here in this haven of golf courses, polo fields and marinas. He roosts behind the soaring glass walls of his poolside terrace, fussing over a roaring fire. He spends his days juggling mobile phones, taking calls, pacing and analyzing the latest action against his staff.

Interviewed late last month in his villa, Gusinsky summoned a butler to bring weak black tea with lemon, Russian style, and settled down to watch the news programs on the Russian network he built from scratch, glowing with pride and giggling at his journalists’ latest prod against the Kremlin.

Gusinsky is an ebullient, passionate fellow who says what he thinks, even when it’s tactless. In 1999, he told Putin, who was then prime minister, that the politician would never be president. Gusinsky was then supporting the regime’s political opponents and says he earlier refused a Kremlin demand to bend his media in support of the regime.

Gusinsky’s debt-laden Media-Most includes NTV, Itogi magazine, Sevodnya newspaper, Echo of Moscow radio and other entities. He surrendered majority control in NTV in November after Media-Most defaulted on a $211-million loan guaranteed by Gazprom, though his company still calls the shots at the network.

The clock stops ticking on NTV this summer when the parent company must pay further debts of $262 million.

“Right now I’m thinking in much shorter terms,” said Gusinsky, hunched before the fireplace. “The authorities don’t even have the patience to wait until summer, because every day they turn on the television in horror. Every day Putin sees how people are freezing in the Far East, and he can’t do anything. Every day he sees how people are dying in Chechnya, and he can’t do a thing. And every day, everyone sees that he lied.”

Company Under Fire on Several Fronts

Media-Most is under attack from the tax police, the prosecutor general and Gazprom-Media, the gas giant’s subsidiary, which now owns 46% of NTV. In a bid for control, Gazprom-Media took court action in Moscow to try to seize the additional 19% of NTV shares it holds as collateral against the loans due this summer. Media-Most, which holds 30% of NTV, has launched court action in Gibraltar and London to prevent Gazprom-Media from getting the shares.

After Russia’s Arbitration Court froze the shares, Gazprom-Media last month triumphantly claimed that it had won majority control of NTV, and it plans to appoint a new board with a Gazprom majority. Media-Most’s lawyers hotly contested the assertion, because the court judge had not touched NTV’s voting rights. So the legal fight goes on.

Ted Turner, the U.S. media magnate and CNN founder, bobbed up offering to buy 25% of NTV for $300 million, and financier George Soros has offered to join the bid. Under the deal, no shareholder would hold a majority share, but Turner wanted a clear guarantee from Putin that NTV would not become a state propaganda tool, a promise the president’s allies made clear he would not give. The status of the bid remains unclear.

If house arrest is getting to Gusinsky, he concealed it well during the interview. He radiated energy, his jolly features bouncing with animation. He was like a proud father cheering on the sidelines of a sports match as he watched NTV’s coverage of the ownership struggle.

News anchorman Mikhail Osokin dryly introduced a segment on the powerful chief of Gazprom and NTV board member, Rem Vyakhirev, who roasted NTV journalists and ranted over network coverage. “We’ll take it into account,” Osokin ended the segment curtly, while Gusinsky roared with delight.

“You know, the most terrible thing is feeling powerless to help,” Gusinsky said. “When they harass journalists, when simple translators who work for the company have their homes searched, when they’re held 10 hours at a time by prosecutors screaming at them, harassing them, what can I do? I can’t help them in any way.”

NTV anchorwoman Tatiana Mitkova and the company’s chief accountant, Mikhail Kalashnikov, were interrogated last month. Media-Most’s deputy chairman, Andrei Tsymailo, fled to London recently after several days of interrogations. The head of finance, Anton Titov, has been jailed on fraud charges, the company offices have been searched about 30 times, and the prosecutor has seized Gusinsky’s villa near Moscow.

For most of its seven years, NTV stood out among other television stations for its critical coverage of two wars in the Russian republic of Chechnya, the plight of Chechen refugees, Putin’s handling of the Kursk nuclear submarine disaster last August, Kremlin corruption and the recent suffering of citizens in the Far East because of energy blackouts during a harsh winter.

Putin, said Gusinsky, could solve the country’s problems but it is much easier for him to seek control of NTV.

“The arrival of Turner or a group of investors would undoubtedly complicate the task of controlling editorial policy of NTV, newspapers and magazines. So the task is now to destroy the company before it comes to an agreement with Turner,” Gusinsky said.

Gusinsky Admits Making Mistakes

As a symbol of media independence, Gusinsky is deeply flawed but at least willing to admit his mistakes.

His gravest error, he recalls, was using his media to campaign for then-President Boris N. Yeltsin in the 1996 elections. He also used his media in 1997 to attack government ministers after he lost out in a bid for a stake in the state telecommunications company.

Despite his faults, Gusinsky did create the only Russian TV network with a tradition of strong, objective and at times even fearless reporting.

“Gusinsky tried to save Russian press, and he created the possibility for really professional and independent journalists to emerge,” said Oleg Panfilov, from the Moscow-based watchdog Center for Journalism in Extreme Situations. “If NTV is not saved, the consequences will be appalling. The last independent mass media outlets will be closed down or turned into obedient propaganda leaflets.”

Putin is intimately involved in the struggle over NTV’s future, according to Alfred Kokh, head of Gazprom-Media. Putin met a group of NTV journalists late last month and told them he supported the continued independence of the network. They remained skeptical.

In fact there are ominous signs for NTV from Vyakhirev, the Gazprom chairman, on how Gazprom will run NTV if it wins control.

“We still think that it would be best if Gazprom continues to hold the control package” of NTV, he said last month, despite earlier Gazprom promises to sell off a part of the network after winning control so as to preserve NTV’s independence. “We are quite mature people, and we will be fair and honest about the quality of the programs. In my opinion NTV has been visibly discrediting itself in the last two to three months, especially compared to the other channels. That will continue to be the case if they go on behaving like this because of their personal stupidity.”

Although Putin insists that he supports media freedom, the Kremlin interferes directly in TV coverage. Putin’s chief of administration, Alexander S. Voloshin, meets each Wednesday with television bosses. Only NTV is left out.

Sergei Dorenko, sacked anchorman on the state-owned ORT network, said Voloshin gives TV bosses “strict and clear-cut instructions as to how they ought to work, how they ought to interpret each particular news event in their news programs.

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In front of the warm fire in his Spanish villa, meanwhile, Gusinsky once again feels touched by the icy fingers of dread that disturbed his sleep in the Russian prison cell.

“Only a complete fool would not be afraid,” he said. “I am definitely afraid. I understand perfectly well what power the Russian authorities have.”

He doesn’t mourn the fact he may never return to his homeland, because Russia has disappointed him. He claims that he doesn’t care a bit if he loses his fortune, which would be “unpleasant but not fatal.”

But he is certain that if NTV falls into state hands, all of Russia’s media will quickly revert to Soviet-style propaganda and democracy will suffer.

Whatever fine promises Putin makes about media freedom, said Gusinsky, his real attitude will be clear in future NTV programs.

“You can’t kill NTV in secret. Its death will be public because if NTV becomes loyal and dishonest, that means it will no longer be NTV. And then everyone will understand that the television company was killed.”