DTH

Going FTA suits most broadcasters and advertisers

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MUMBAI: With increasing number of channels in the country, much of the interior towns have found solace in having free-to-air (FTA) channels. Doordarshan’s own Direct to Home (DTH) service Freedish has found 12 million active subscribers in the interior parts of the country with its list of FTA channels.

Discussing the FTA market were MCCS India CEO Ashok Venkatramani, TAM Media Research LV Krishnan, Zee Entertainment Enterprises chief content and creative officer Bharat Ranga, Reliance Broadcast Network Limited (RBNL) CEO Tarun Katial and RK Swamy Media group senior VP K Satyanarayana. The session was moderated by Chrome Data Analytics and Media Pankaj Krishna.

Krishna started off by asking Satyanarayana if advertisers are monetising the platform to which he said that Freedish has very few satellite channels and it is not necessary to look at FTA channels particularly for media planning. However, he stated that research shows that Freedish is able to add 10 per cent incremental reach so it has more monetisation scope.

Venkatramani heads three channels under the ABP brand name which hasn’t yet gone pay and in fact isn’t available on Freedish either. He said, “We haven’t gone pay because the ecosystem doesn’t allow us to do so. The price at which we sell channels to MSOs is not in our hands. Freedish is too expensive and cost per household is Rs 30.” FTA channels depend heavily on advertising revenue and according to Venkatramani, this is not sustainable and he doesn’t see any incremental reach happening in the news genre.

Krishna questioned LV Krishnan on how TAM ensured fair representation from houses which were either metre dark or power dark. To which Krishnan said that the important metric is to see who the consumer is. “Is this consumer accepting FTA channels because he is economically unable to graduate to pay? What is the value of this customer for targeting advertising? And is it financially viable to create content especially for this industry?” he questioned. The positive points of this market, according to him, is that this audience doesn’t have any distraction and so time available for entertainment is higher than urban audiences. But the issue they face is frequent power cuts.

Katial said that in its studies, RBNL has found that the northern market is less penetrated as compared to south or east but it needs a unique distribution for which Freedish fits perfectly. “Many advertisers will pay the delta for it whether it is FMCG or Telecom. Metros are fragmented while these markets have low penetration,” he said.

Zee Anmol is Zee’s FTA channel that shows handpicked content from its channels. Ranga pointed out that a lot of marketwise and platform-wise research is done before deciding which content from its flagship channel Zee TV will work for this audience rather than just replicating the entire set of shows. He also feels that in future there will be three modes- FTA, pay and premium and soon Freedish will also offer pay channels. “Distribution will be far more competitive in the next 10 years. Currently, there isn’t much difference between FTA and Rs 200 for all channels. In future the gap will be large,” he said adding that he expects average revenue per user (ARPU) to rise up to Rs 1500 to Rs 2000.

While geotargetted advertising is on the rise, Katial feels that is it more suitable for large MSOs and Freedish can’t do it. But the real winning situation will be when the ad cap regulation is resolved. “Today a radio station in Mumbai takes more ad rate than a national news channel,” he informed.

Ranga said that when a new channel enters the market it can start off as FTA and then convert to pay, which is what Zee does. Krishnan highlighted that the audience doesn’t care about platform but about content. This was emphasised by Satyanarayana as well that the advertisers look at the audience and not the platform. FTA is not actually FTA, because the customer is paying money for the carrier’s bandwidth. In the future, advertising will be aligned either to content, such as in-branding or to the carrier.

Katial shared the data that across Europe, there is the phenomenon of cord cutting at the rate of 5-10 per cent every month and every year and then going FTA.

Krishnan shared data that according to their research, while five years ago 4.5 to 5 members of a home were watching at the same time, this has dropped to 3.8 today. However, the repeat gets about 1.5 members. “Broadcasters have started segmenting by ensuring repeats to cater to various age groups,” he informed.

So while the FTA market has begun in India, it remains to be seen where it will finally head.

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