Political Economy Students' Journal

To understand the current state of the communication sector in Portugal – a reflection of the broader political scenario –, we must necessarily look at the class struggle fought within the belly of the media corporations. In the last decade, Global Media Group, GMG, has been a particularly interesting case study, as it has shown the contradictions inherent to the privatization and monopolization of the communication sector. GMG still owns some of the most prestigious media vehicles in Portugal, namely Diário de Notícias (DN), Jornal de Notícias (JN), and TSF. In the past decade alone, we have witnessed five collective layoffs, suspended contracts, and unpaid wages. Journalists have accused the shareholders and managers of purposefully destroying the group, as they have been fighting each other for the ownership of the group’s capital – as usual, at the expense of the workers.

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The previously mentioned media vehicles have been subject to very bad treatment in the past decades, starting in 2005. Ever since, JN has lost its building in Marquês de Pombal (Lisbon), in 2016, and more recently also the Porto building, one of the oldest and most important media headquarters in Portugal, which gave way to a new hotel –even more heartbreaking since the newspaper’s main audience has historically been northern. But when did it all start? In 2005, when Controlinveste bought out Portugal Telecom’s holding Grupo Lusomundo (successfully privatized 10 years prior) for 300,4 million euros. Lusomundo’s executive director at the time, Luís Silva, had acquired the public newspapers JN and DN in 1995, with the PSD-led government’s reprivatization program. 

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In June 2014, Controlinveste (GMG’s old designation) fired 160 workers in a collective layoff, among them 65 journalists. Journalist Paulo Martins, executive editor of Jornal de Notícias at the time, said in an interview after the layoff: “I, for example, found out I was fired through a lousy phone call”. “With just the remaining people it’s impossible to create a product worthy of these historical newspapers”, Paulo Martins added. The executive director of GMG, Vítor Ribeiro, justified the layoff by saying that “the current 750 workers are too hard to motivate and “as a leader (…) I am excited to feel the great effect that these decisions will have on the team’s motivation”.

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In December of the same year, Controlinveste Media, whose capital was 100% owned by Angolan businessperson Joaquim Oliveira a year before, was renamed Global Media Group. This change followed the restructuring process which led to 2014’s layoffs. By then, 72,5% of GMG’s stakes were owned by António Mosquito (27,5%), Luís Montez (15%), BCP (15%) and Banco Espírito Santo, BES (15%). The restructuring – financially advised by Banco Privado Atlântico, whose owner (Carlos Silva) was the non-executive director of BCP – entailed the conversion of BCP and BES’ credit into social capital. As a side note, António Mosquito was connected to the Angolan oil company Sonangol, which has been involved in a string of corruption schemes, namely regarding the banks BCP, BPI, and BANIF.

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In 2017, Macanese businessperson Kevin Ho, through KNJ Global Holding’s capital, bought 30% of the group for 15 million euros. Simultaneously, the shares that belonged to António Mosquito and Luís Montez were transferred to an Angolan businessperson – with shares in Portuguese, Angolan, and English companies – José Pedro Soeiro (30%). As a footnote, the previously mentioned Jornal de Notícias’ building in Porto was sold to an anonymous society belonging to Kevin Ho, to build a luxury hotel. After the restructuring, GMG’s debt actually increased, with its total losses amounting to 60 million euros at the end of the year.

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The year after, 2018, GMG collectively fired 25 more workers – though none of them were journalists –, and subcontracted new administrators through a company named Epimetheus. According to GMG, this agreement was more efficient and less expensive. GMG admitted that though the decisions “may not have been consensual”, they were necessary due to “the difficult challenges of the [digital] market”. In 2020, amidst the COVID-19 pandemic, the directors of Diário de Notícias, Ferreira Fernandes and Catarina Carvalho, resigned, soon after GMG’s threat of another collective layoff and cuts in the newsroom’s material resources. Earlier in the same year, 2018, the group had already announced the postponement of payments regarding the workers’ holiday benefits.

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In September 2020, GMG went through yet another restructuring process when Grupo Bel’s businessperson Marco Galinha bought 40% of its shares for 10 million euros. This meant that GMG was worth around 25 million euros in 2020, about 8% of its perceived value just 15 years prior when Controlinveste bought Grupo Lusomundo. One month after the entrance of Grupo Bel’s social capital, the company announced a brand-new collective layoff, this time affecting 81 employees – of which 17 were journalists. GMG called the decision “hard, but unavoidable”. However, the Journalists Union contested it: “Dismissals cannot always be the answer to compensate for losses in newspaper and advertising sales or failed investments, within the framework of a highly irresponsible management”, urging the workers to resort to legal support. Following the layoff, new editorial directors were appointed for each of the main media vehicles, namely Diário de Notícias, Jornal de Notícias, and TSF.

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The new owners of the newspapers swiftly announced, in 2021, a reduction of 40% in working hours and 6% in wages above 1995 euros, covering newspapers, printing, and distribution. GMG justified it with the loss of profit due to the pandemic, to which the Journalists Union replied: “Let’s just hope this is not a palliative for the application of other types of measures that are more harmful to workers”. DN’s journalist João Pedro Henriques summarized the situation at the newspaper: “This, in our case, is happening in a newsroom with just twenty people, who suffered a collective dismissal months ago that wiped out a third of its journalists”. In the same year, 2020, the editorial directors Rosália Amorim (DN) and Inês Cardoso (JN) resigned as a protest and manifestation of solidarity with the journalists and other workers. With more than 100 workers fired since the Covid pandemic began and with the postponement of payments, the political party Bloco de Esquerda called for a parliamentary hearing with Marco Galinha.

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As a side note, this war between GMG and Bloco de Esquerda remains active in 2024, especially with Mariana Mortágua as the new coordinator of the party. Mortágua accused Marco Galinha of trying to silence her by giving up her columns in Jornal de Notícias. Bloco de Esquerda’s coordinator also highlighted the CEO’s connections to a Russian businessperson living in Portugal (the father of Galinha’s wife). “These familial ties are not innocent”, asserted Bloco de Esquerda on their proprietary website. In 2022, with the macroeconomic hardships brought about by Russia’s entry into Ukrainian borders – namely inflation –, the pressure on GMG to increase wages only amplified. Instead, however, Galinha reinforced GMG’s capital shares in the supplier Vasp. This implied an attempt at establishing his Grupo Bel as the only distribution network in the social communication sector in Portugal, according to many politicians and news articles.

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In 2023 there was another restructuring, which resulted in Galinha becoming the majority shareholder of GMG (50,2%) and in the entrance of new shareholder António Mendes Ferreira, CEO of United Resins (export industry), now owner of 10% of GMG’s capital. Months later, a new and mysterious fund named the World Opportunity Fund (WOF) bought 37% of Páginas Civilizadas – Lusa and GMG shareholder possessed by Galinha, with only two employees and unclear economic activity –, attaining partial ownership of GMG. In September 2023, a new executive committee was announced, made up of journalist José Paulo Fafe, Diogo Agostinho, and Filipe Nascimento. Paulo Fafe, shortly after being designated, expressed his intention of firing around 200 workers, including 40 from JN and 30 from TSF. This prompted the editorial direction of TSF, Jornal de Notícias, O Jogo, and Dinheiro Vivo to resign in protest, all in four months.

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In January 2024, amongst the refusal of the Bahamas located fund (WOF) to advance money to pay their workers since November and GMG’s disdain shown by the lack of communication with said workers, the Journalists Union declared: “We are puzzled at the posture shown by the Global Media Group’s executive committee”. They reported the whole situation to the Authority for Working Conditions (ACT) and accused GMG’s administration of “being incompetent” and “only wanting to add to the Employment Institute's lists”. Just a couple of weeks after, journalists from JN, Dinheiro Vivo, and O Jogo unanimously decided to suspend their contracts, following “the total illegality that constitutes the lack of payment of wages owed by law to workers”. Soon after, José Paulo Fafe resigned because, as he alleged in a parliamentary hearing: “the conditions to exercise these [his] functions are exhausted (…) namely the required understanding between shareholders”. 

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Since January, the Social Communication Regulatory Authority (ERC) has launched a process of investigation into the group's property holders and the consequences of the restructuring efforts. In February, it was news that it had already received responses from some owners. Bloco de Esquerda requested access to the documentation received by ERC, for transparency. ERC then formalized the World Opportunity Fund’s loss of voting rights on the 51% stake in the social capital of Páginas Civilizadas due to a lack of transparency. As of March 2024, GMG’s capital ownership looks like this: KNJ Global Holdings (35,25%), Páginas Civilizadas (29,75%), José P.C.R. Soeiro (24,5%), Grandes Notícias (10,5%). March 2024 started with another collective layoff, which included the whole editorial direction of Diário de Notícias – the only ones who had not willingly resigned before (from the main newspapers) – among 17 more workers. Some of these workers (11) had been contracted by José Paulo Fafe in what was an alleged attempt at reinforcing the editorial and economic direction of the group. It is worth referring that out of those 11, GMG only kept the two worse-paid workers. Their justification was that “the situation was unsustainable from a financial perspective” (the usual…).

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The whole situation culminated in the first general journalists strike since 1982, about 40 years prior. In March 2024, over 40 media vehicles refused to publish. Speaking to the public news channel RTP, Miguel Carvalho, a freelance journalist, stated that journalists are continuously fighting “to avoid situations of slavery, which have increased in recent years". "We have reached a limit. We do not have enough working conditions to ensure that the public has access to truly independent information", explained journalist Sofia Branco, also president of the Literacy Association for Media and Journalism. 

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To conclude this exposition, we must shed some light on the main reasons why a profit-driven communication sector is antagonistic to the concept of democracy. From what we have seen, media groups such as Global Media engage in highly exploitative labor practices, like low wages, long hours, and precarious job security. From a Marxist point of view, this is because the existence of private property necessarily entails the struggle between those who have capital – in this case, the media conglomerates –, who simply prioritize profit and the extraction of surplus value, and those who do not – workers –, and have to sell their labor power to survive. Moreover, the cuts in resources, hours, and wages, plus the need to push for content that generates viewership – usually highly sensationalized –, often leads to a steep decline in quality, especially when it has to be produced quickly to avoid losing out to competitors, compromising integrity, harming the workers and the general public, who depend on the media for credible information. 

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Lastly, journalism’s integrity is also hindered by biased reporting and self-censorship practices that seek to appease advertisers. The media are very important to a so-called democratic society, as they are one of the main battlefields in which class struggle takes place, not only through the traditional means but also through an “exclusive” one: the media themselves are means through which the workers actively fight to promote their class interests in the form of news articles, often pitted against a board of directors and managers who always seek to frame the news in a frequently called “neutral” light, which naturally promotes their class interests in a hidden way, through agenda-setting and self-censorship (but not only), often carried out by cherry-picked editors.