Press seals price-war deal

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ISTANBUL - Brought low by years of give-away competitions and now a price war, Turkey's establishment press was forced to pool resources yesterday to beat off the challenge of Sabah, an upstart challenger from the Eighties, writes Hugh Pope.

The owners of Milliyet newspaper, the Dogan group, bought a 50-per-cent stake in the Hurriyet group and in front-page advertisements vowed to create 'a giant cooperation in the media'.

Few outsiders immediately understood the implications of the surprise deal. Further developments were expected, hinted at by a line in the announcement that the two papers would strengthen Show TV, one of the best of the new private television stations in which Hurriyet has a 25 per cent stake.

If there is a target of the alliance it is Sabah, which started up in the Eighties and now outsells both Hurriyet and Milliyet and controls another strong private television station, ATV. Hurriyet and Milliyet can make savings in joint distribution, leaving Sabah out in the cold.

But all three main newspapers are in financial straits after expansion in Turkey's recent boom years, including modern buildings and colour presses. Circulation wars that involved giving away hundreds of thousands sets of encyclopaedias were costly.

Worse came with Turkey's economic crash in the first six months of the year, triggering a price war. But even that could not save the industry from an erosion of readership. Circulation is now half what it was last year.

Hovering on the fringes of the newspaper war are Turkey's big industrial groups. The Koc group, Turkey's biggest conglomerate, is rumoured to be interested in picking up a newspaper.

Ultimately, the effect will be towards less diversity in the Turkish press. One commentator said: 'Twenty years ago the Turkish press was an orchestra. I regret the trend towards a monopoly.'