Campaign India Team
Jan 12, 2010

Anant’s Blog: The next decade in media in India

Last week, I had a ramble on changes in Indian media in the past decade. A few readers asked me to write on the decade to come. It was a killer, but I had a bash. I’m expecting a lot of brickbats. Any bouquet would be most welcome. 

Anant’s Blog: The next decade in media in India
Last week, I had a ramble on changes in Indian media in the past decade. A few readers asked me to write on the decade to come. It was a killer, but I had a bash. I’m expecting a lot of brickbats. Any bouquet would be most welcome.
 
PRINT: NEWSPAPERS AND MAGAZINES:
 
 
It’s going to be downhill for most – in almost all areas. Overall, the share of printed newspapers and magazines in total AdEx will fall to no more than 15% by 2020.
 
Newspapers will continue to lose to both television and the Internet at a faster pace than has been discussed and debated. By the time the newspaper reaches you, almost all the news is dated. What do big newspaper houses need to do? What will we see? Similarly, the news magazine genre will become more and more irrelevant. Can they survive without changing or will we see a new avatar? Let’s take a look forward.
 
Measurement
No area will see as much change as measurement. Advertisers are growing increasingly restless about the delivery from print. Other media, notably television, have got their act together to give advertisers timely, detailed and relevant data. Why can print not do the same? Advertisers will no longer be willing to wait six months or more for readership data. By 2012 end, we will see readership data being available every three months (in the worst case; perhaps even monthly. If the new IRS-NRS combine cannot deliver, a new measurement entity is completely possible, supported by major advertisers.)
 
So much for readership. Advertisers will also demand circulation measurement. There are too many newspapers and magazines that get away with murder, quoting highly exaggerated circulation claims. This will have to come to a complete stop – with advertisers refusing to consider a publication in the plan which is not audited by an industry body accepted auditor. ABC is best placed to benefit from this, but one should not rule out the possibility that a new player is waiting in the wings.
 
For publishers, it is a difficult time. Having got away with unreliable numbers for years now, they will have to come to terms with a new environment where they will have to tell the truth. This will cause the numbers for a lot of newspapers and magazines to come down dramatically, and this will have a telling effect on advertising rates. There is no escape, however. It is better to bite the bullet than have no advertising at all.
 
New editions of newspapers
We will see a dramatic slowdown in the launch of new editions. While the last decade has seen an explosion, the next will see an extraordinary drop in pace. Publishers will stop chasing new ‘readers’ unless a new edition is reasonably supported by new advertising as well. If the new edition is largely dependant on advertising support from national campaigns, the project will be nixed. Publishers will ask themselves a question that they are unused to doing: is there adequate support from local and retail advertisers?
 
Cover price of newspapers
English: We will see cover prices going up steadily throughout the decade, slowly at first and then picking up speed. By 2015, it will not be uncommon to see a Rs.10 newspaper in the metros. By the end of the decade, it will be at least twice that.
 
Indian languages: Higher cover prices for the leading newspapers, reaching Rs.5, average, by 2015.
 
Content of newspapers
Here is where we will see the most dramatic of changes. Opinion and analysis will, often be the biggest front-page headlines. In addition, the newspaper will be transformed more into a daily magazine than a daily newspaper. Lots more of features, debates, discussions and signed columns.
 
e-readers
 

Lots of revenues from electronic readers much earlier than we had thought. As the readers get cheaper, the migration from paper to e-reading will be dramatic, even outside of the metros. Perhaps, especially outside of the metros.
 
Positioning
Newspapers will be forced to learn positioning. What does one stand for? Who is the core reader? Content focus will be more sharply defined to differentiate one from the other; alignments to political parties, to issues and concerns and to geographies will be sharply visible.
 
Circulation and wastage
Advertisers will stop demanding high circulation. They will reject newspapers with high wastage (which they will know, thanks to the new measurement available). Simply put, advertisers will want to stop paying for the readers who don’t matter; newspapers will learn to see their readers as human beings, not as a boring demographic.
 
UGC
We will see a lot more user-generated and user-involved content. More interactivity, especially on truly local issues that matter.
 
Focus on local issues
We will see less of the ‘national’ causes being ‘owned’ by newspapers and more of the neighborhood, the suburb, the immediate surroundings. Readers will demand of newspapers that they help in solving local problems and concerns. Those newspapers who succeed in projecting that they lead in this area will gain.
 
Special interest newspapers
 

Special interest newspapers will sprout and succeed. For example, a newspaper which focuses more on sport will be the preferred read for sports buffs – and the preferred advertising vehicle for brands targeting the sports buff.
 
Advertising rates for newspapers
Overall, advertising rates for English newspapers will nosedive; but advertising rates for non-English newspapers will go up, year on year, till these newspapers get closer to their due. Much will depend, however, on their being measured by a respected neutral authority.
 
Magazines
 

The issues regarding measurement will see the death of a surprisingly large number of magazines. Some of the revelations will shock – is the circulation that low, one will ask. Magazines will learn to operate with much smaller staff combined with the use of contributors. Efficiency will come to the forefront and all will be asked to deliver more quantity, more quality – on time. The revenue pie for magazines will change for the better; much greater dependence on revenue from copy sales and subscriptions and much lower dependence on advertising revenues. Advertisers will be a happy lot; cheaper space and less clutter.
 
 
Special interest magazines
Special interest titles, especially those with print runs of 15,000 or less, will mushroom. These will largely be free, funded by advertising and by readers who do not qualify to receive a free subscription. The low variable cost will allow the ad rates to be kept within affordable limits.
 
Newsmagazines
 

There’s no soft way of saying this: they’re in trouble. News magazines will have to re-invent themselves to an extent that they are no longer news magazines. Lots of opinion, lots of analysis. Their periodicity will allow them to go deeper into issues than the newspapers can – and this needs to be reflected in the final product. Again, the issue rising to the fore will no longer be, ‘how many copies do you sell?’ the advertiser will ask, ‘who reads the magazine?’.
 
Circulation
Magazines, like print, will have to understand their core reader a lot better. Who is he? How many cars does he have? How many credit cards? How often does he travel? How many children does he have? What are their ages?
 
Circulation departments as we know them will cease to exist. This department will be required to do a lot more than producing excel sheets on how many copies sold and the number of returns. They will learn to deliver as a field force in a research company does, gathering and analyzing data on their readers. The recruit will have a new profile: post-graduate, preferably with a specialization in statistics or psychology.
 
Advertising rates for magazines
Overall, the great days are gone. Lower rates for the highest circulated magazines, I’m afraid (will drop to 50% of today’s rates by 2015) – and higher rates for the low circulated magazines who can demonstrate and measure reach and influence.
 
Cover prices for magazines: English
Again, as in the case of newspapers, the cover prices will zoom north. Rs.100 cover prices will be common by the end of 2012 for magazines which can prove themselves. Those with less compelling content will be in the Rs.50 range. There will be few magazines priced lower – and these will struggle to get advertising as well.
 
Cover prices for magazines: Indian languages
 

Here, too, the rates will go up, but not as significantly as in the English space. Biggest price increases will be in Tamil, Malayalam, Gujarati and Bengali titles, where the competition is less than, for example, in Hindi.
 
Advertising rates for Indian language magazines
This deserves mention, because my view is that the rates, as in the case of non-English magazines, will actually go up for a few years to come. The rates have been kept low because of the issue of measurement – and, as I have said before, measurement will improve dramatically. The biggest gainer will be non-English magazines.
 
BLOGS

Before one comes to the Internet, blogs need to be addressed. Blogs written by those who have expertise in a particular domain will become more and more influential – and will gain more and more advertising. The biggest losers will be newspapers; readers and, consequently, advertisers, will flock to these blogs. Look out for expert blogs on the auto sector, the telecom sector, retail, construction, the airline industry, tourism, fashion, food, technology, health, fitness, music in the next two years. Their time has come.
 
THE INTERNET
This is the whopper of the next decade.
 
It’s all very well creating the content and a great web product, but who will foot the bill? I subscribe strongly to Rupert Murdoch’s view that the user will have to pay for content on the Net.
 
The million dollar questions: What are the rates one could charge? How will the money be collected? What happens to traffic when you shift from free to pay?
 
These are all questions the satellite channels learned to ask a few years ago. The answers that they first came up with were far from accurate; so too, will be the case in this instance. But there is no question about the fact that the reader will learn to pay. Content has a cost and quality content has both cost and loyalty.
 
Measurement on the net will become even more enlightening and will allow advertisers to pin-point their targets. All in all, good news for advertisers.
 
By 2010 end (yes, as early as that) we will see good advertising created for the Internet; we will see case studies of effective digital campaigns; we will see products being launched only on the net.
 
Understanding of how the consumer behaves on this medium will improve by leaps and bounds. Advertisers, media planners and publishers will work overtime to learn and to teach. Data and understanding will be available easily – sometimes at a price.
 
Measurement will cause a slowdown in the proliferation of dotcoms. Those sites which don’t get readers will get close to zip as far as revenue is concerned. There will be a general clamp-down on stealing content; bona fide publishers will put in more energy and resources into catching the thieves.
 
There will be a lot more of rich media content as bandwidths improve, bringing dotcom a lot closer to TV.
 
On this front, I believe good dotcoms will come closer to TV than good TV channels come to understanding dotcom.
 
As with bloggers, the sheer paradigm shift in publishing caused by zero paper and printing costs will allow small and intelligent publishers to launch news products on the Net. These publishers will be the SINGLE biggest threat to newspapers in a country like India, where large publishers have spent little time understanding their readers and the needs and wants of these readers.
 
Journalists will leave brick and mortar publishing houses to join small entrepreneurs or to turn into entrepreneurs themselves. There will be a huge demand for journalists – a gap that could be filled easily by the new generation. Over 40 and you’re a journalist? Be careful, you’re almost a dinosaur. Tough to hold on to your job, almost impossible to find a new one – unless you have an opinion. Don’t have an opinion? Get one, soon.
 
RADIO
 

I’m a doomsday prophet here as well. Yields will continue to head south – largely caused by advertiser disbelief in the measurement. Radio channels will have to come together and invest significantly in effective, timely and credible measurement.
 
It will not help that Internet radio is getting more and more popular thanks to better bandwidth. Internet radio is the single biggest threat to FM; for one, it’ll always be cooler!
 
Radio channels will have to look imaginatively at content; more format shows, more magazine shows, more opinion and analysis.
 
As in the case of newspapers, radio channels will have to look hard at the definition of the channel and learn to define a positioning and be true to the positioning. The current ‘we’re for everyone’ channels will die a miserable death.
 
Big plus: News will be allowed on  radio. There is no stopping this – and I’ll put my neck out on this one. By 2012 end, all radio will be allowed to broadcast all forms of news, not just sports and traffic.
 
The vexatious issue of payment of royalty will continue to be a mess. Music companies worldwide are in denial of the writing on the wall and so it is in India.
 
TV
Lots of changes. I cannot see a slowdown in the mushrooming of TV channels. Cost-related (read: technology and infra related) barriers are crashing and a TV channel is still a decent gamble. Channels with low viewership can still survive – provided the costs take the reality into account. Measurement will improve each passing year and the measurement of DTH will slowly be the standard.
 
Cable operators will continue to shrink in number and in influence as DTH makes greater inroads.
 
More of the subscribers’ money will reach the channels than is the case today – making high investments in content a viable proposition.
 
Overall Yields:
Yields will go UP! As measurement improves – and it will – channels will able to prove to media planners and advertisers that they are horribly underpriced. Expect rates to go up by the middle of next year, when the effects of the slowdown are, by and large, behind us.
 
News TV: English
I cannot see great changes in English news television – the barriers in terms of people cost are the highest here. Credibility is a function of how old a channel is and how long consumers have been loyal – every day, therefore, makes it more difficulty for an aspirant. Current leaders will rule the roost, even 10 years from today.
 
FDI limits will be relaxed.
 
All news television channels will have very strong dotcoms. The consumer will toggle between watching a program on TV and on the Net with the same viewing comfort. If your dotcom sucks, so will your bottom-line.
 
News TV: Hindi
These will be broken in high credibility, reasonable yield, high influence channels and low to medium credibility, low yield and virtually ‘entertaintment’ news channels. In the case of thee former, again, I can’t see the leaders yielding to a newcomer. In the case of the second category, it’s anybody’s game. We will see a dramatic improvement in the dotcom offerings of the larger players.
 
News TV: non-English, non-Hindi
Lots of scope here – and dangers for the incumbent leaders. The investments are low, and new channels with clear positioning could make inroads. Again, these news channels will wear their alignments and interests on their sleeves and, therefore, garner immediately loyal viewership. Learn from Tamil Nadu. Do not be neutral, is the message here. Expect all these channels to have robust dotcom products to support their channels.
 
Business News Television
As in the case of News TV, described above, the older players will have a distinct advantage, thanks to the credibility built over the years. The decline in the influence of print, described earlier, will also cause these channels to increase influence. Robust dotcoms are the need of the hour.
 
GEC Hindi
 
 
(A still from STAR Plus' reality show, Music Ka Mahamuqqabla)

This is the toughest one to call. The days of the undisputed leader in the space are over. All it requires for any of the existing GECs to become number one is getting one big show – and that could come anywhere.
 
Advertisers are already used to the notion and now put their money on all the top three channels.

The critical benefit in being Number One for a decent span of time will be improved yield.
 
The leaders in the genre will be helped by increased subscriber revenues thanks to the growth of DTH and the improvement in measurement. As in the case of print, this will lead to lower dependence on the advertiser.
 
The big plus: thanks to the recent disasters in the form of 9X and Real, new, large investments in this area will be most unlikely and the incumbent players are likely to enjoy a long reign.
 
Inventory management will come to the fore – and channels would try and sell close to 100% inventory every single day rather than try and hold on to the yield – if they are not the leaders.
 
Non-Hindi GECs
 
Except for Tamil, which has a very mature market for GECs, the rest of the country (and I underline rest) will be happy hunting ground. Cost will be a focus area. Low-cost programming (dictated by efficiency and not by mindless cost-control) will be the norm. Again, the growth of DTH and the measurability will cause these channels to gain. They will exist, they will make money, they will eat into the over TV AdEx pie.
 
Special interest, including music TV and channels for kids
Low cost programming and lots of syndicated content, repacked and rehashed and translated – that’s what we will see.
 
But a new revenue route will explode: licensing and merchandising. Lots of stuff to buy at almost every imaginable price point.
 
Sports channels
The way the game is played will change dramatically, which probably helps one understand the considerable investments being made here. Measurement, that wonderful tool, is back to the fore. As the cable operator vanishes, sports channels will see their revenues from subscribers, especially when it comes to live sports, skyrocket.
 
The big one: Subscription rates go up dramatically (and the government will allow rates to go up).
 
Pay-per-view will become more and more common – and the consumer will be happy to pay for the viewing!
 
Wrap Up
It will be a fascinating decade ahead of us, dictated almost completely by changes in technology. Measurement will be demanded – and those who deliver will make it. Those who don’t, won’t.

 

 

 

 

 

Source:
Campaign India