Tallinn city media closures to hit dozens of city employees, MM Grupp

The recently announced planned closure of several of Tallinn's city media outlets may entail the layoffs of dozens of employees on the Estonian capital city's payroll as well as the loss of hundreds of thousands of euros' worth of contracts for the Estonian-owned investment company MM Grupp.
The shutdown of Tallinn's city media had been agreed upon on Sunday already by parties in talks to form the city's new ruling coalition. "To be closed down are the newspapers Pealinn and Stolitsa as well as [Tallinn TV], as they're the most costly in financial terms," said Riina Solman, chair of Isamaa's Tallinn region.
Earmarked for Tallinn's city media in this year's city budget was €2.9 million, €830,000 of which was slated to be spent on its newspapers and €1.4 million to go toward TV programming.
According to Solman, it's yet unclear when exactly these publications will be shuttered. "Those details haven't been established in that sense," she explained. "These are general decisions – political agreements."
Which is why Tallinn city media director Kristiina Rossman said that for now, the papers will continue being published and TV programming produced as normal.
"People are doing their jobs sincerely, professionally," Rossman stressed. "As long as the contracts remain in place, we'll keep doing our jobs."
Tallinn's city media currently employs 40 people. "That is an entire floorful of people who will apparently have to look for new media work," Eesti 200 representative Marek Reinaas said in an appearance on ETV's "Terevisioon" morning show.
The words of politicians reach city employees' ears as well. "People are very demotivated," Rossman acknowledged. "All of this is very sad to watch."
In Tallinn, a structural unit of the city government can be abolished by order thereof. At about the same time, city leaders should be deciding who exactly will be laid off.
"If the new coalition adopts such a decision, it will likely constitute a collective layoff, and that will be done in accordance with the law," the city media chief noted. "People will receive as much severance as prescribed by law."
Postimees waiting on new €600,000 contract
On top of the paid reporters and editors, another six people produce content for the city's media outlets as well, paid commensurate with how much work they do.
The city moreover has contracts with a whole slew of businesses responsible for ensuring that this media content reaches consumers as well. Layout, language editing and printing for Pealinn and Stolitsa, for example, have been provided for years by Postimees Grupp.
In ten years, the company has earned approximately €3 million for this work. Their latest contract, worth €797,000, was signed two years ago and is set to expire on April 21.
Postimees Grupp was also the only company to submit a bid in the public procurement for the next two years as well. As the City of Tallinn had planned to reduce the circulation of both of its papers from the current 60,000 to 50,000, Postimees' bid was a bit smaller this time as well at €613,000.
According to Rossman, a new contract with Postimees hasn't yet been signed, and they now need lawyers to advise them on how to proceed with this.
"Right now we're in a situation where politicians promised that they will definitely be shutting it down," she said. "But we need a legally sound solution too. The Public Procurement Act provides for specific procedures."
Before any further decisions are made, the city media director says it needs to be clarified whether and what rights Postimees gained after winning the procurement.
In the event that this new contract with Postimees does remain unsigned, however, that doesn't automatically mean that the April 22 issues will be Pealinn and Stolitsa's last; in principle, the law does allow for the current contract to be extended slightly.
Duo Media holds quarter of a million in contracts
Things are even more complicated when it comes to the city's TV programming. The City of Tallinn pays Duo Media Networks – another company owned, like Postimees, by MM Grupp – to broadcast its content.
Valid through the end of the year, contracts totaling nearly a quarter of a million euros in value have paid for the airing of two Estonian-language TV programs on its channels.
The 40-minute "My Tallinn" ("Minu Tallinn") airs on Kanal 2 every Sunday afternoon and Monday morning. A slightly shorter "Tallinn News" ("Tallinna uudised") is on Duo5 Mondays through Fridays, and Kanal 2's main news program, "Reporter," includes a brief, three-minute "Tallinn News" segment every weekday.
The city has fixed-term contracts with Duo Media, and according to Rossman, it has yet to be considered whether and how the city could cancel these contracts before the end of the year.
"We just have to review all of our contracts one by one to make sure everything is done legally," she stressed.
The Russian-language "Novosti Tallinn," meanwhile, currently doesn't cost the city anything. According to Rossman, TV channels want to broadcast this program at their own expense, and contracts for doing so have been signed with both Duo Media and TV3's parent company Bitė Group.
"I believe they're following what's going on at Poska House with the same interest, and morally speaking, they're probably also prepared for it," she said.
City media chief: Hardest part is the people
On top of the big-ticket production and distribution contracts, Tallinn's city media also has a number of smaller contracts as well, used, for example, for the procurement of suits for TV presenters as well as technical work on their websites.
This year's city budget even includes a line item of more than €400,000 for cross-media development. Rossman said that part of this money will go toward repairing the giant screen located in Freedom Square – the rest was to go toward the development of a new platform bringing together all of Tallinn's city media channels.
"As of right now, no contracts whatsoever have been signed," she acknowledged. "Our final step was to decide which direction to go and how it would be better and cheaper to do it. But again, right now this is likely off the table at this point."
Although the city is likely looking at quite the legal headache, according to Rossman, that is far from the hardest task that lies ahead.
"The most difficult task will be telling people that despite the fact that there are no real complaints against them, they have to lose their jobs," she said.
Nevertheless, it still cannot be said for certain that the shutdown of these publications will result in the layoffs of all 40 city media employees. According to Rossman, their unit's services are utilized by other city government units as well.
"More than 70 special projects were carried out over last year, including recordings of training courses, seminars and live broadcasts," she recalled.
Media budgetary costs in Tallinn's 2024 city budget
- newspaper Pealinn's activity costs – €381,250
- online portal Pealinn's activity costs – €50,840
- newspaper Stolitsa's activity costs – €381,250
- online portal Stolitsa's activity costs – €20,340
- cross-media content, i.e. Pealinn, Stolitsa and Tallinn TV programming cross
- costs, including outsourced articles from contributors – €50,840
- Estonian-language TV programming production, securing airtime – €970,920
- Russian-language TV programming production, securing airtime – €452,880
- city media advertising and marketing, including city media social media channel management – €15,250
- city media consumption studies and analyses – €20,340
- purchase, maintenance and repair of city media equipment – €86,420
- cross-media development – €406,670
- Estonian-language current affairs radio program production-related costs – €35,590
- Russian-language current affairs radio program production-related costs – €35,590
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Editor: Marko Tooming, Aili Vahtla