Look at the players: the Living Media group that produces Aaj Tak for DD is going it alone for a quality Hindi channel. C.M. Ibrahim, former I&B minister, is spearheading a Hindustani or a Hindi-Urdu channel, Al-Hind. CNN, in talks with Aaj Tak initially, is hoping to increase the local news segment much as BBC and CNBC did. TV18, which produces eight hours of Indian business programs for CNBC, has also announced a lifestyle and information channel. Industry sources confirm the accent is on news, current affairs and business, with lifestyle thrown in for effect. So even the biggies are interested. After shutting down its only daily, Reliance Industries is serious about re-entering media via TV and has bought over Plus Channel. It plans three channels on news, current affairs, sports and entertainment.
These events have enthused global majors. Hong Kong-based News of the World (NOW) is increasing its India programming in the news segment. Australian Kerry Packer's Channel 9 has taken three hours on DD Metro prime and could soon get to extend its reach. None of the new entrants is talking, but the job market is abuzz. Aaj Tak has been poaching from competition, TV18 is talking with news providers, Al-Hind is also recruiting. Aaj Tak and TV18 are launching in March and Al-Hind in December.
But why the sudden rush into a high-investment, high-gestation business where viewership is skewed? News programming in India draws advertising revenues of just Rs 100 crore. With increased competition and audience fragmentation, it could double but there still won't be enough money to go around. Seven-year-old Star TV, with its two-year-old 24-hour news channel, is losing money. Its revenues in January-October 2000 stood at Rs 40 crore. Two-year-old Zee News' revenues also were lesser than Rs 15 crore. India programming on BBC and CNBC earned Rs 20 crore and Rs 25 crore respectively in this period.
The key may lie in popular demand for up-to-date news programmes. People investing in or tracking non-traditional sectors like media, technology and entertainment need to watch their business news as it's re-positioned on a daily basis. The advertisers get audience richness—an audience that'll stay with the programme through the slot—which attracts advertisers of brands with a male skew (as men ‘are the news-watchers'). And so, as Meenakshi Madhvani, chief of Carat India, points out, it could be a short while before news segments start charging a premium and convert to pay channels, just like it is globally. With a dual revenue model, channels in India could look at breaking even. Market forces indicate that a company like Star or Zee that has a bouquet of channels can bunch its offer and go pay.
Foreign entrants have learnt they have to go local to raise their appeal. Especially in a segment like news where, as the viewership is small, advertisers go by general brand awareness. Star responded to this by dressing Star Plus in Hindi. In fact, it even wants to make Star News largely Hindi-based. Also, they feel a popular news service can be a surer route to gain clout with the government and impress audiences. The English daily news segment has only Star News and DD.Even cable and satellite homes rate high on DD News, though Star's relationship with NDTV, the Prannoy Roy company that produces its news, is strained. A contract that binds the two until 2003 is seen as being lopsided and may not be renewed. Sources say this could lead to Roy starting his own channel soon. Roy has been producing six weekly shows for bbc, a daily half-hour news in Tamil for Vijaya TV, and has been in talks with Bloomberg for a tie-up.
In Hindi, DD has only Zee as competitor, leaving out Jain. But Zee News has poor coverage. Aaj Tak promises quality programming in "shudh Hindi" which should give DD a run for its money. In Hindustani programming, Al-Hind has identified a virgin slot.But, as all get on to the bandwagon, wouldn't a shakeout follow? The leaders aren't perturbed. Says Indira Mansingh, chief of news at Star TV, "One is not really keeping count of how many news channels are poised to enter the market. Star News is the best in its genre and it's for others to maintain their positions." Deepak Sandhu, additional director general and head of news and current affairs at DD, says that "there's definitely space for competitors but only the ones with the best quality will survive". Watch out for some really hot headlines.
