The state management of media activities in Vietnam

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Introduction Media theories suppose that capitalist governments intervene in media markets to “promote desirable outcomes and inhibit undesirable outcomes” [Picard 1989: 94]. State interventions are in- tended to fix/respond to market failures in producing public goods, and to monopolize the power [Flew & Swift 2015: 26; Hoskins et al. 2004: 288]. The core logic of such an intervention is often welfare economics. Governments’ actions are justified when the cost of the intervention is less than the benefits such as maximizing social welfare or achieving economic efficiency [Hoskins et al. 2004; Picard 1989]. However, instead of focusing on pure economic goals, governments normally rely on their main ideology to make media policies [Rolland 2008]. Governments can use a set of legal policy tools such as regulating ownership, providing subsidies, taxation, licensing media out- lets, antitrust law, and content rules to regulate media markets [Freedman 2008: 10]. Media discour- se more often records political media policy goals; few researchers take an economic approach to exploring current policy goals of governments. However, Van Cuilenburg and McQuail argue there is a media policy paradigm shift towards “the logic of the marketplace and the technology and the wishes of consumers” [Van Cuilenburg & McQuail 2003: 200]. But the extent to which capitalist governments control the media is always assumed to be less significant than government control of media in centrally planned economies [Picard 1989: 95]. Literature Review Actually, although media scholars have done extensive research on how Western govern- ments intervene into their media markets [Rolland 2008; Hollifield 2006; Hoskins et al. 2004; Van Cuilenburg & McQuail 2003; Picard 1989], few of them have examined how Asian post-communist governments intervene in their state-run media markets, and we could not find any analysis of Viet- namese media policies. Therefore, we have conducted a qualitative document analysis of media policy tools in Vietnam, combined with in-depth interviews done by media policy-makers and media managers, to see if media policy aims to correct market failures such as externalities, public goods, and monopoly given the country’s half-communist, half-capitalist character. We also surveyed sta- te-run news organizations in Vietnam in an attempt to study policy effectiveness on the news media market. Elements of a media policy: definition and objectives The definition and purpose of a media policy have been the subject of extensive debate. In his book “The Politics of Media Policy”, Des Freedman argued that “there is clearly no such thing as media policy, in the sense of a single or uniform pattern that can describe all the various modes of structuring media performance and media systems”. Rather than a singular noun, he preferred the use of “media policies” [Freedman 2008: 15]; Freedman identified three ways of defining a media policy: the actors involved, the instruments developed, and the goals pursued. Based on these scho- lars, Freedman defined a media policy as “a range of legally sanctioned tools that are designed to modify the structure and behavior of media markets” [Freedman 2008: 10]. These tools can include public ownership of media, subsidies, tax incentives, licensing powers, ownership restrictions, con- tent rules, quotas, trade barriers, trade agreements, enforcement of intellectual property rules, rest- rictions on speech rights and information flows, codes and protocols, and non-intervention. Howe- ver, Freedman was not satisfied with the fixed definition of a media policy as “the full range of at- tempts to influence the orientation of these [media] systems by social actors mobilizing whatever resources they can in order to promote their respective interests” [Freedman 2008: 13]. In Freed- man’s own words, a media policy is “a process that concerns the interaction between different actors, the institutional structures within which they work and the objectives that they pursue” [Freedman 2008: 13]. Freedman also acknowledged what Sandra Braman had pointed out in her paper “Where Has Media Policy Gone? Defining the Field in the Twenty-First Century,” that there was always a “latent policy,” or unexpected outcomes from ongoing events that affect the media [Braman 2004: 15]. State-run media systems overview Rolland’s case study of Norwegian media policy showed that the Norwegian media system was in some ways similar to a state-run media system, because the Norwegian system did not pay so much attention to economic goals as other Western media systems did [Rolland 2008]. However, Norwegian media were not under the full control of the state. According to David Webster (1992), a state-run media system was “controlled both financially and editorially by the state”. This type of system was different from public media in democratic countries which were “funded directly or indirectly by the state, but over which the state does not have tight editorial con- trol” [Webster 1992]. State-run media were also different from private media which were not controlled financially or editorially by any political party or by the state. According to Silverblatt and Zlobin, a state-run media system controlled the media as propaganda tools for four different purposes: (1) to promote the regime in a favorable light, (2) to vilify opposition to the government; (3) to give skewed coverage to opposition views; and (4) to act as a mouthpiece to advocate a regime’s ideology [Silverblatt, Zlobin 2004: 22]. According to Siebert et al, state media exist under authoritarian and communist political regimes [Siebert et al. 1978]. Current media policy in Vietnam The policy of merging news organizations. Among 19 documents regulating the ownership of news organizations in Vietnam, the 2016 Journalism Law is the key document. According to the Law, each news organization in Vietnam must be registered under an owning body. This owning body must be a Party/State organization or a political, social, religious organization at a provincial level or above. The owning body must provide initial funding for its news organization, appoint the top leader (either the editor-in-chief or the station director) after the approval of the Ministry of Information and Communication (MIC), and be responsible for all violations of its news organizations [National Assembly 2016]. This regulation led to the existence of nearly 1,000 owning bodies of news organizations. Since 2000-ies, the government has planned to re-structure the news media industry in terms of merging news organizations within a province under a single owning body, ins- tead of multiple bodies as before. The minister of the MIC briefed about the latest revised scheme in September 2015, but the scheme faced harsh criticism from the press due to its unreasonable merging of a large number of news organizations in Ho Chi Minh City and Hanoi markets. First, to better manage the news organizations on their development way. Second, to eliminate the overlapping, inefficiency, imbalance and make sure that the news industry is developing in the correct direction. Third, to shut down newspapers which do not meet licensing requirements; and to transform inefficient newspapers into newsletters. Fourth, to reduce state subsidies, and develop a new system of self-financed newspapers. Based on this list, we can see clearly that the government aims to serve its own interest (bet- ter allocating its management resources as well as cutting down its budget for the press) rather than to correct market failures. The policy of stopping subsidies and encouraging self-financing. Among the 7 documents concerning the state subsidies for news organizations in Vietnam, there are 4 themes: documents regulating the postal/mail services for newspaper distribution (2), free distribution copies for people in remote areas (3), free training, free renovation, and cost subsidies for programming in remote areas (1), direct subsidies for news organizations (1). Generally speaking, the Vietnamese government provides free postal/mail services for all newspapers that serve as the mouthpieces of the Communist Party from national to local level, including such national publications as The People Newspaper (Båo Nhan dan), The People Army Newspaper (Båo Quan Eoi nhan dan), The Communist’s Magazi- ne (Tap chi Cong sån) and 64 local newspapers under direct ownership of the Party. Both news organizations and postal services must submit annual budgets to the State for approval. Besides, the government also commits to distribute free copies of 18 different newspapers and magazines for people in remote areas and minority groups in an attempt to “provide more information and propaganda to boost developments in politics, economics, culture and society” [Thu tnong chinh phu 16.01.2017; The Government 2006]. Most publications are produced only for a given group and are not distribu- ted among other groups, except Bamboo Shoots (Mang Non), a magazine for children. Now and then, the government provides money for news organizations in remote areas to improve their pro- fessional skills, update their technologies, rebuild their facilities and increase their salaries. For ins- tance, the government provided 1,730 billion Vietnamese dong (approx. 74,5 thousand USD) since 2012-2015 for these activities [The Government 2012]. The government fully subsidizes newspapers which primarily serve as the Party mouthpieces, while financially independent news organizations which carry out the Party orders are subsidized partly [Bo tFi chinh-Bo van hoå-thong tin 20.02.1993]. As far as broadcasting organizations are concerned, they are subsidized on needs, according to Decree 16/2015/NB-CP, via the state owning bodies. Based on the description, if excluding propaganda as a public good, we can still see that this policy element aims to supply what the government considers to be public goods and external bene- fits, or in other words, it aims to correct market failures. The policy of reducing income tax for the press. There are two documents regulating tax pa- yments of news organizations in Vietnam. They are joint circulations issued in 2010 by both the fi- nance department and the information and communication department. The first one provides gene- ric instructions for news organizations on how to pay value added tax and business income tax. The second one provides specific instructions for the Vietnam Television station and other local stations on how to pay value added tax and business income tax. It is worth noting that the tax rates in these documents are given according to the 2013 Business Income Tax [Law Summary of Business Tax 05.01.2016] and the 2016 Circular on Value Added Tax [Bo tai chinh 12/08/2016]. However, the tax rules in general are still applicable. Generally speaking, news organizations in Vietnam are required to pay two different types of tax: business income tax at a rate of 25 % (later reduced to 22 % and currently to 20 %) and va- lue added tax at a rate of 10 %. Depending on tax, the government divides news organizations into two categories: fully self-financed organizations and partly self-financed organizations. As for the 2016, Vietnam has 300/857 fully self-financed news organizations [Bånh giå 30.12.2015]. Every fully self-financed organization must pay taxes at the full rates after regulated deductions on costs of productions, R&D funds, free copies of newspapers for special readers, etc. Partly self-financed organizations may enjoy an income tax benefit of 1 %, 2 % or 5 %, depending on the characteristics of their media products[4], but they still have to pay 10 % value added tax. Since 2013, according to the new law, newspapers enjoy 10 % income tax rate because they suffer loss of advertising revenu- es while TV stations are still profitable from ads. This policy element makes it clear that the policy-makers aim to maintain the diversity of ne- wspapers, which they consider to be a public good. The policy of protecting the press freedom with some content regulations. Generally speaking, news organizations in Vietnam can be fined if violating several rules about content. The fine can amount from 1 million Vietnamese dong up to 100 million Vietnamese dong (approx. 4300 USD), depending on violations. News organizations are often fined for the published content which the government deems to have violated Article 9 of the 2016 Journalism Law. Article 9 bans publishing and broadcasting information against the State and the Party; fake news and information; information that discriminates against other people, information that offends the nation and national heroes; violent information; privacy information; etc. These rules are strictly applied and many news organizations have been fined due to violations. The government also issues specific instructi- ons on certain events that they deem to be important. The government also regulates the proportion of children programming, rules on corrections, rules on foreign programming, rules on education programming, rules on professional code in national political meetings and events, etc. Here we can see the mixed policy goals: restricting political news is to serve the political in- terest while regulating harmful contents is to serve the public interest. The policy of expanding space/time advertising. The government issues permit for busines- ses to advertise on media. Regarding news organizations, the government creates limitations on time/space advertising, according to the 2012 Advertising Law. Specifically, newspapers cannot ad- vertise more than 15 % of their coverage, broadcasting organizations cannot advertise more than 10 % of their programming, cable cannot advertise more than 5 % of their programming, with the exception of advertising newspapers and advertising channels having been registered with the MIC. Again, restricting time/space advertising is to serve the public interest, reducing extemal cost of having to watch too much advertising. The policy of enabling joint operating with private firms. According to Article 5 of Circular 19/2009/TT-BTTTT, the government allows joint operating activities in broadcasting, as long as they do not relate to political and current news events and do not exceed 30 % programming time daily[5]. According to the 2016 Journalism Law, joint operating agreements are also allowed for print news organizations, as long as they do not relate to political and current news events. Previously, it was mentioned in Resolution 05/2005/NQ-CP of the Communist Party [Government resolution 18/ 4/2005]. Here the policy goal is to expand the marketplace of ideas from the private sector, which can be seen as to nurture external benefits. The policy of diversifying across media platforms and having multiple titles. The 2016 Journalism Law is the key document that regulates the diversification of news organizations vertically and horizontally. This policy element seems to cultivate external benefits in terms of increasing news diversity. Media policy goals through in-depth interviews The guideline for making policies in Vietnam, according to a current policy-maker, is to serve the ideologies of the State and the Party. All the observers of news media policies in Vietnam said so. Most of them thought the news media policies to be part of political schemes. Probably, because none of them took a closer look at the economic goals highlighted in the policies, except for a former media policy-maker in the previous period. He did try to open a new door for the news in- dustry in Vietnam. Professor A (Nov 14, 2017): She said that media policies in general have political aims. She was not aware of economic goals. Being a member of the Communist Party herself, she said that all the laws and regulations were suitable and served the regime well. Professor B (Jan 19, 2018): As he specialized in media economics, he said that besides poli- tical goals, there was also the economic goal. However, he was not sure if these media policies, es- pecially the media merging scheme, could achieve economic efficiency. He highly praised the policy to socialize the media and allow for joint operating agreements, but he commented that many corruptions happened in big TV stations due to this policy. Lawyer C (Jan. 24, 2018): He used to work for Tia Sang, the only private newspaper in Vietnam after the Vietnam War; later the government shut down his paper. Now, in his eighties, he af- firms that all the media policies aimed to protect the Party schemes and the communist regime. He did not see any economic goal in any policy. The lawyer said he thought all the laws and regulati- ons to be well-written to fit the Party’s ideology. Former TV news leader D (Feb. 2, 2018): As he got higher education in Vietnam, UK and currently in the USA, he was an expert in the media industry. He said that the government interven- tion into his news station was carried out at many different levels, but he also perceived more eco- nomic pressures on his stations. He preferred to talk about economic outcomes rather than about po- litical outcomes. He did not comment on policy goals, but I could guess that he perceived many economic goals. Current propaganda magazine editor E (Feb. 26, 2018): He worked for the propaganda unit at the city level for years, and was assigned to do content for its monthly magazine. He believed that “all journalism industries have their own restrictions on speech rights.” He disclosed that his propaganda unit tracked not only political messages, but also other violations of content rules. He believed there was a balance between political and economic goals in each media policy. Former policy-maker F (March 2, 2018): He worked for the Ministry of Information and Communication for nearly 20 years, and was the author of many key policies in the digital era of Vietnamese journalism. He was among initial policy-makers who advocated for a media merging scheme to (1) make it easier for the management of the Party-State, and (2) generate economic effi- ciency at a local level. He was also the author of joint operating agreements or socialization of broadcasting industry. Answering questions about media policy goals, he said, “Based on the guiding principles outlined by the Party, we created policies that help to move news organizations forward and to serve the public interest”, his guiding principle was that the policy must match with industry activities. Influence of media policies on news quality and financial performance Professor A (Nov 14, 2017): She said she did not perceive any impacts of news media policies on news quality and financial performance of media organizations. She believed that the policies were not impactful in Vietnam; news organizations developed on their own way and policy-makers were always behind the industry. Professor B (Jan 19, 2018): He thought that joint operating agreements and socialization of media content helped to improve news quality and news diversity. He also thought that the combined effects of all policies on financial performance of big news organizations were huge. Big organizations have the power to do the price discrimination on advertising. However, he complained about the inefficiency of having too many broadcasting stations in the country and considered it to be a waste of investment when the government inflicted must-carry rules. Former TV news leader D (Feb. 2, 2018): He saw the increase of news diversity in media programming thanks to the joint operating policy, but he also saw the decrease of news quality due to the laziness of main TV journalists and heavy PR efforts from businesses and advertising agenci- es. Regarding financial performance, he thinks that the current policies help TV stations gain more ads revenues. Former policy-maker F (March 2, 2018): He considered his policies to have generated moti- ves for the news media industry to make more profit, have better content, and well-adapted with the technologically changing context market. He was proud to push for the convergence of multimedia platforms within a news organization. Lawyer C (Jan. 24, 2018): He recounted the history of policy-making in Vietnam since National Day (2.09.1945), and added more details about the newsroom where he used to work before the journalism reform in 1989. He explained the causes of the changes in news media policies in 1946, 1956 and 1989. However, he concluded that the Party was constant about one thing: the press must be the mouthpiece of the Party. That’s why Vietnam should not have private press. This conc- lusion actually contradicted to what the former policy-maker F had told. Mr. F said that the Party and the government did not issue any document that directly ban the private press. However, all news organizations have for a long time represented state-owned organizations, so the policy-ma- kers just added a requirement in the 1989 Law that new news organization should be registered under a state-owned organization. Former policy-maker F (March 2, 2018): Although all news organizations are legally owned by the State, the diversity of news does not suffer due to the fact that individuals can always pay a state organization to submit a license application for them. Also, there are so many newspapers, TV and radio stations, cable services, Internet services and mobile news services, that he considers the news market to be very competitive. That was also the reason for the government to merge news or- ganizations in provinces in order to reduce state subsidies and to encourage local news organizati- ons to be financially independent. Conclusion Policy-making activities for the development of journalism and communication in Vietnam in the recent two decades have been comprehensively carried out, affecting press-news managers, providers, organizations and the public. The system of policies is based on the responsibilities and functions of communication; the disclosure principle requires that the state should report its management activities on the media. However, the policies have yet to clearly delineate the border-lines between the state management of media activities and the management of business activities of media entities. At times, though the policies cannot catch up either with technological changes and market conditions or with changes in the public, they have to facilitate breakthroughs in the quality and quantity of journalistic and media products. Now that journalistic and media products are beco- ming still more like merchandises and services driven by natural changes and dynamics of the eco- nomy, the policies have to be regularly updated so as to catch up with the realities. The management of journalistic and communication activities have to follow changing information flows inste- ad of following only political agendas. The state-run media policy-making in Vietnam does not aim to correct market failures in the first place, but unintentionally puts it as a secondary goal along with their political goal. The ambi- guity of policy goals is caused by market factors out of their political control and their lack of guiding principles for policy-making. That’s why some policies failed to harness market-oriented, de- mocracy-driven news media firms, increased social costs (more fake, biased, sensationalized news than high-qualified news), and decreased social benefits (profits for the media, news quality for the public). In organizing the development and management of journalism and communication activities, especially when the society of information increasingly takes shape in Vietnam, the creation and perfection of the State’s mechanism and policies for regulating and developing these activities have to be approached from a market perspective and comply with the dynamics of the media market. Sustainable mechanism and policies have to be created and refined for developing modern journalism and communication models, investments made to develop human resources in both managerial and practical sectors and to promote journalists and media producers in the digital era. Vietnam has to develop a strategy for developing journalism and communication that pertains to building a society of information, knowledge and international integration.

About the authors

Thi Ngoc Huyen Nguyen

Ohio University

Email: huyen.me@protonmail.com
Scripps School of Journalism

Chi Trung Bui

Vietnam National University

Email: trungbuichi@mail.ru
Faculty of Journalism and Communication, VNU - University of Social Sciences and Humanities

References

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