Wednesday, November 22, 2006

Who da man? Digital TV Scandal Explained?

Jurģis Liepnieks, a PR specialist and former advisor to ex-prime minister Andris Škēle and recently resigned advisor to the current PM, Aigars Kalvitis (both of the People's Party founded by Sķēle), claims that Kempmayer Media Limited (KML), a mysterious company that was awarded a USD 53 million contract to implement digital terrestrial TV in Latvia, was actually started by Latvian TV mogul Andrejs Ēķis and Šķēle as an indirect stakeholder.
This is the story my newspaper is coming out with tommorrow. Both Ēķis, the head of Latvian Independent Television (LNT) and Škēle have denied Liepnieks allegations, with Škēlē saying they were a mixture of fact and fantasy.
Since November 2002, when the contract, said to have, in fact, been between KML (owned by Ēķis and an offshore company connected to Škēle, with a stake held by Liepnieks at one time) and Ēķis former employees and pals (at the Digital Latvian Radio and Television Center/DLRTC), much has happened. All work on digital TV was stopped in 2003, when prime minister Einārs Repše called the deal with KML a shady and fraudulent arrangement and initiated arbitration proceedings to have the contract declared invalid. The Stockholm arbitration tribunal so declared in June 2006, though saying that the DLRTC had been misled into signing the agreement ( a milder ruling than saying it was deceived by deliberate fraudulent intent).
The boards of the DLRTC and its parent company, the state-owned Latvian State Radio and Television Center (LVRTC), which runs broadcasting infrastructure in Latvia, were quickly dismissed and 11 persons, representing a range of individuals (company and state officials, businesmen, lawyers and financial advisors) connected in some way to the digital TV deal, have been charged with criminal offenses, mainly fraud and money laundering, or actions to aid and abet such crimes. Since KML did actually deliver digital TV equipment and partially installed it, the fraud charge may be hard to prove.
What is striking about Liepnieks version of events (and it has been guessed at in the Latvian media) is the arrogant stupidity of those involved, who actually believed that in 2000-2002, one could carry on as if it was the "anything goes" early 90s, and that it was necessary to go to Byzantine lengths to cover one's tracks and then sit across from the DLRTC and say -- wink, wink-- we're this totally unknown British company, so trust us. And since everyone knew what the game was about-- so says Liepnieks-- there was no reason not to trust. Indeed, had the plan been executed, Latvia would have gotten a reasonable start on digital terrestrial instead of going nowhere fast. Alas, the homeboys (a paralell concept to the Latvian bālēliņi, hard to translate) didn't realize that there would be «a verry great messh» (viene liele šmuce) to mimic the Yiddish influenced accent of Ābrams, a Latvian Jewish country peddlar character who is seen in several classics of the late 19th century Latvian stage. Ābrams, a slightly comic but lovable curmudgeon, warns some Latvian farm women that their schemes will come to a bad end. Still applicable in the 2000s (rest your fictional soul, Ābram..).
Anyway, whatever Liepnieks motives for, to put it mildly, dragging his old boss over the coals and causing no small amount of possible trouble for Ēķis, it is a great parting shot now that I am moving on from the paper in the next ten days or so.

6 comments:

elijas ielas gaiteņi said...

Ne jau Liepnieks pret Šķēli uzstājas. bet pret kādu TV biznesa ģēniju, kurš pameta savus cilvēkus (Spundi, Pauderu) zem riteņiem.

Nekas nepaliek nepamanīts.

Juris Kaža said...

For those who don't read Latvian, the above comment says:
"It was not against Sķēle that Liepnieks took a stand, but against a TV business genius who left his people (Spunde, Pauders) under the wheels.

Nothing goes unnoticed.

Anonymous said...

Vai tiešām man būtu jānotic, ka tā nav vienkārši kārtējā piristiska māņu kustība, lai novērstu uzmanību vai ievirzītu šo skandālu vēlamās sliedēs?
Par ko ir šī grēksūdze? Atvainojiet, bet vēl nekas nav tapis skaidrs.
P.S. Un kāpēc, Juri, Liepnieks atnāca tieši uz DB/pie Tevis? DB nav gluži tas medijs, kuru lasa tauta, un kura, kā varētu domāt, ir šī PR soļa galvenā mērķauditorija. Protams, ziņa jau drīz aizies pa visiem iespējamiem mediju kanāliem.

P.P.S. Nu skaists demaršs Tev sanāca. Lai veicas jaunajā darba vietā! :)

gusc said...

Yes with this all shit going on - Latvia will probably be in digital-stone-age for next few 5-10 years. While in other countries people will sit on a couch and watch beautiful reality shows or news in 1080p HD video. I hate my country!

wx said...

gusc, why on earth would you want to be an early adopter?

in a few years all that equipment will cost peanuts.

Bleveland said...

This we really could call the final big BANG. Everybody would like to end his or her job with that great invention, that great solution or, more applicable to this situation, that great story that causes some considerable medial seismic activity.

There will always be sceptical individuals as the anonymous one above (who obviously has a problem with the English language). The questions asked by the anonymous are interesting though and I am sure we will get plausible answers ;-))) I myself am wondering about the motives Liepnieks had at all. They must have really pissed him off….
Being plain honest; was it just a coincidence that this story occurred a week or so before leaving the paper :-D ?

The whole digital TV story in Latvia is of course a sad one. Especially for the Latvian people (I am sure Šķēle, Liepnieks and Ēķis are fine without it).

Some technical considerations to whom it might concern…

Do not expect too much from DVB-T (terrestrial digital TV standard). Many a man got deeply disappointed about the provided picture quality. Especially people that owned a HD-ready LCD or plasma TV already. A traditional CRT TV is very forgiving and you can put in any low data rate video shit and it will still give you an acceptable picture. New HD TV’s are not the same. I have to adjust the sharpness of my little 26” HDTV to the lowest level in order to get an acceptable picture out of my set top box for DVB-T. The picture from a HDTV channel from digital TV over satellite (DVB-S) is stunning though!
It certainly sounds nice to offer more than 20 TV-channels with only 3 or 4 digital terrestrial TV frequencies, but in reality it is just a matter of sharing the available bandwidth / data rate (which is very limited). Since HDTV in 1080i and even in 720p demands much more bandwidth and/or new advanced video codec’s that are not standard yet, the step from standard definition TV as we have it today to HDTV is a very large one. More frequencies / TV transmitters or fewer channels are the only options available, in any case until the latest coding techniques have been implemented in the standards and carried out by broadcast companies.

As for Latvia I am afraid they might already have missed the market window for digital TV (and that is close related to the eventual “business case”). I guess a lot of people got connected to cable TV since 2003 which, even though not always digital, offers more channels than analogue terrestrial TV is doing. Also Lattelecom is (soon) up and running with IPTV over DSL. With HSDPA and EV-DO already available and WiMAX (maybe) still to come there are various options to realize digital TV through wireless data networks rather than to obtain it from some corrupted self occupied institution. This is sad because terrestrial TV –digital or analogue- is unbeatable when it comes to coverage and with the above mentioned alternatives there is an obvious risk that the countryside once again will be defeated.