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CTC Media, Inc.

Company Overview

CTC Media, Inc. is one of the largest commercial television broadcasters in Russia offering entertainment programming. It operates two free-to-air Russian television networks, CTC and Domashny, and a number of owned-and-operated regional television stations across Russia, which broadcast CTC and Domashny programming. CTC is a television channel offering high quality entertainment programming targeted principally at viewers aged 6-54. About 100 million people are within CTC's signal reach. Domashny Network, launched in 2005, is principally targeted at female audiences aged 25-60. About 70 million people are currently within Domashny's signal reach.

On June 1, 2006 CTC Media carried out IPO on NASDAQ and became the first and largest media company in Eastern Europe to do so. Shares of CTC Media are listed on the NASDAQ National Market under the symbol CTCM. Since 2007 CTC Media has started the strategy of aggressive development through the purchase of DTV, a Russian national free-to-air network, from Modern Times Group, acquiring a majority stake in Channel 31 (fourth largest TV channel in Kazakhstan) and by setting up a television company in Uzbekistan. CTC also acquired two Russian production companies - Costafilm and Soho Media - that will form the basis of in-house program rights management and production function.

HIV/AIDS Profile

Russia is facing one of the fastest growing HIV epidemics in the world today.  With just over 400,000 cases of HIV registered officially, experts estimate that about 1.2 million Russians are leaving with HIV today.  According to Ministry of Health, 100 Russians learn that they are HIV-positive every day: 80 of them are under the age of 30; 44 are young women; nearly 50 contracted HIV through unprotected sex.  Set against the backdrop of a demographic crisis, the growing and increasingly generalized HIV epidemic presents a serious challenge to Russia's social stability and economic growth.

In addition to its core business - development and management of television networks - CTC Media strives to actively participate in addressing social issues.  The population most vulnerable in the context of HIV epidemic in Russia - young people under the age of 30 - is the core audience for CTC Media's products, the people for whom we work and with whom we strive to communicate.  In a situation where information and new positioning of the issue of HIV/AIDS can help prevent new HIV infections and improve quality of life of those already living with HIV, we, as a company, cannot afford inaction.

The Russian Media Partnership to Combat HIV/AIDS was announced as a response to Kofi Annan's call to action to mass media to do more on AIDS.  At the inaugural meeting of the Global Media AIDS Initiative at the UN headquarters in New York in January 2004, Gazprom-Media (the largest private media holding in Russia at the time), with support from Transatlantic Partners Against AIDS (an international NGO with operations in Russia), announced the initiative to lead Russia's media sector in a coordinated public awareness effort on HIV/AIDS.  At the Eurasia Media Leaders Summit on HIV/AIDS which followed in October 2004, CTC Media took over as Chairman of the Russian Media Partnership (RMP), a group of over 30 companies committed to mobilizing their competencies to impact the growing HIV epidemic.  The RMP (at over 50 companies currently) and its campaign, StopAIDS: Affects Every One - the largest public health effort in Russia to date, entered in its 5th year in 2008.

The Russian Media Partnership to Combat HIV/AIDS aims to mobilize the communication power of mass media to shift public attitudes on HIV/AIDS.  We seek to harness our capacity to communicate messaging and ability to distribute the communication to large audiences to change behaviors towards prevention of new HIV infections, build tolerance towards people living with HIV and creating an atmosphere for a constructive dialogue on HIV/AIDS on all levels - public, political and individual.  The RMP's objectives are, therefore, engaging mass media and necessary partners in the fight against HIV/AIDS and thereafter ensuring the greatest possible impact of the united companies on attitudes of Russians towards HIV and people directly affected by the epidemic.

The RMP includes: a coordinated, cross-market advertising campaign (for television, radio, outdoor, print, cinemas, new media and consumer products companies); integration of HIV/AIDS messaging and storylines into entertainment and analytical programming; ensuring access to quality information on HIV/AIDS (online, telephone and print); briefings for producers and journalists to provide opportunities for programming and improve the quality of daily reporting on HIV/AIDS; special events aimed at mobilizing target groups in the fight against HIV/AIDS; and, advocacy vis. a vis. Russian government to promote the concept of public-private partnership in addressing HIV/AIDS.

The primary audience for the RMP is the group most vulnerable to HIV/AIDS today - young people (16-34 years old) and, particularly, young women.  The secondary audience for communication is society at large.  While young people need targeted messaging aimed at concrete actions and behavior, the perception of HIV/AIDS as an issue of "others" is highly prevalent among Russians of all ages and HIV/AIDS as a topic of discussion yet needs to be normalized in the society at large.  The RMP, therefore, segments its communication based on the target audiences of participating outlets and the appropriate messages and communication for each segment.  The variety of platforms and distribution channels allow for targeted communication to each group while the campaign StopAIDS: Affects Every One links all of the activities together under one brand.

In addition, RMP's audience are CEOs of media companies and private sector more generally, as well as policy leaders and decision makers capable of affecting positive change in the area of HIV/AIDS and public healthcare more broadly.  CEO's of participating media companies become advocates for better legislation, better policy and practices on HIV/AIDS at national and local levels, in daytime television and workplace programs,  in the context of journalism integrity and national healthcare projects.

The StopAIDS campaign is a comprehensive cross-market advertising campaign that is produced by leading advertising agencies in Russia with technical support from local experts (NGOs and government institutions), communities of people living with HIV/AIDS and with participation of the RMP companies.   To date, the RMP has produced, released and placed 7 flights of the renowned campaign for television, radio, print, outdoor, cinema theaters and new media.  The campaign has been recognized as a crucial component in raising general awareness of the Russian population on HIV/AIDS by the Russian government in the first Country Report on HIV/AIDS Epidemic in the Russian federation.  Campaign materials have been awarded mentions and prizes at Russian and international advertising festivals and competitions (Art Directors Club Russia; Moscow International Social Advertising Festival, etc.).

RMP companies participate in the creative process of campaign development to ensure maximum impact on their audiences.  In addition to providing such expertise pro-bono, each participating company provides placement for these materials free of charge.  In 2007 alone, the RMP companies contributed to the placement of video and audio reels, outdoor posters and print advertising, estimated at 15 million USD.  Since the launch of the initiative in 2004, the commercial value of contributed advertising space has reached 30 million USD - unprecedented for a social campaign in Russia to date.  In 2008, CTC Media has committed to cover costs associated with development and production of the seventh flight of the StopAIDS campaign.