Regional TV: The land of opportunities and challenges

MUMBAI: For national broadcasters, having a regional footprint is becoming imperative as it is growing at a furious pace compared to its matured richer brother that is more than double its revenue size.

Pegged at Rs 140 billion, regional TV media grew at a whopping 70 per cent in 2011 compared to the industry growth of around 12 per cent. Deeper penetration of cable & satellite (C&S) homes, rise in per capita income, emerging middle class and high consumption expenditure are fuelling this growth.

Asianet managing director K Madhavan calls regional the new "National" as the language entertainment channels compare strongly with the Hindi GECs on critical parameters like viewership and reach.

"Regional has become the new national. In 2011, the regional space grew at 70 per cent compared to the national growth of 11-12 per cent. Overall, the television industry is pegged at Rs 300 billion while the regional is Rs 120-140 billion. Regional channels have a strong captive audience. One of the reasons for this high growth rate is the emerging new middle class with increased purchasing power in the Tier I and Tier II cities; the positive impact of this could be huge and bigger. The per capital income of Southern states is almost 80 per cent higher than the Northern states."

In recent years, as national markets have slowed down, advertisers have shown renewed interest in regional television.

Says Zee Entertainment Enterprises Ltd (Zeel) EVP regional channels Sharda Sunder, "Growth in the regional sector is largely due to a few factors like size of population. The top nine regional states form 50 per cent of the population and the per capita income in these states is higher than the national average. Consumption expenditure is, thus, higher than the national average."

Regional broadcasters, however, do have their own set of problems that need to be dealt with on a long-term and short-term basis. These range from lack of quality content coupled with rise in cost of content to monetisation. Carriage fee is also a huge concern.

Says Sunder, "Subscription revenues need to drive in. New media is also a challenge." She was speaking at Ficci Frames 2012.

The regional market mainly consists of six states - Tamil Nadu, Andhra Pradesh, Karnataka, Kerala, West Bengal and to a lesser extent Maharashtra. "Tamil Nadu has the lion’s share with a revenue size of Rs 12 billion, followed by Telugu and Bengali which accounted for Rs 8.5-9 billion each. Kannada and Malayalam rake in revenues of Rs 6 billion while the Marathi genre is estimated at Rs 3.5-4 billion," says Madhavan.

He also pointed out that the penetration of cable as well as DTH is growing in the South; regional channels have also increased. The quality of local content has improved due to competition.

"Of the total C&S penetration, we had one-third in the South, while DTH has conquered 30 million connections out of the total 42 million. Time spent in non-metros is growing and should catch up with the metros in two to three years. Currently, time spent in non-metros is two hours and three hours in metros. Due to competition with national channels, the quality of local content has increased considerably. The contribution of revenues from overseas market is 10-12 per cent," he averred.

Another challenge is the movie-driven GRP, with almost 35 per cent of regional GRPs coming from movies. "The problem is that the cost of movies has gone 200-300 per cent up in the last 2-3 years. There is difficulty of good content and the shortage of skilled talent specially to cater to 100 plus regional channels has become a big issue."

Since movies drive ratings for regional channels, both Madhavan and Sunder are of the opinion that financing film related content could be a preferred option. Channels, in fact, need to look at getting into movie production.

Madhavan said the cost of producing a show has gone up considerably. While it used to cost Rs 100,000-150000 to produce a local show, it has increased considerably. A case in point is the Tamil version of Kaun Banega Crorepati (KBC).

"KBC, which we are producing in the South, costs Rs 2.5-3 million per episode. The big question is whether regional media will be able to absorb this cost. Earlier, 90 per cent of the software was available locally. Now by default we are forced go to national producers like Endemol," he pointed out.

While Madhavan concurred with Sunder that digitisation is good for the industry, he was skeptical about its reception in the semi-urban and rural areas as set-top box costs were high. He also said that the carriage fee for regional channels has gone up.
Madhavan also termed the recent decision of the Tamil Nadu government to impose heavy tax on DTH service as a dampener for the industry since it had emerged as a major source of pay revenue for the broadcasters.

"Recently the Tamil Nadu government imposed a tax of 32 per cent on DTH services, so that is going to impact pay revenues. Advertisement rates are the lowest in the country because of the unhealthy competition in the regional markets. We are selling at 8-10 per cent of the national channel rates," he stressed.

Latest Reads

MIPCOM 2016 sets new records

CANNES: Record attendances at MIPJunior and MIPCOM, more World Premiere TV and International Screenings than ever, a remarkable Japan Country of Honour programme, a Personality of the Year, Shonda Rhimes, who packed delegates into her keynote interview and a tour de force opening keynote from Sony...

Specials Event Coverage Mipcom
BidSlate offers film buyers, content-owners negotiation platform

What if filmmakers didn’t have to rely solely on film markets and sales agents to sell content? And international film buyers had continuous access to a 24/7 international marketplace populated by an ever-growing catalog of content?

Specials Event Coverage Mipcom
Two popular BMX content creators join XTreme video multi-platform network

XTreme Video, the leading Multi-Platform Network (MPN) for extreme athletes and creators with over 200 million views each month and more than 50 million social followers, today announced the addition of two of YouTube’s top BMX creators, KinkBMX and Boqer123, to the XTreme Video network. Heading...

Specials Event Coverage Mipcom
INsight-Flare to produce reality competition 'The Line'

INsight TV has commissioned yet another new original format in Ultra HD, partnering with Flare Media to produce the reality competition The Line.

Specials Event Coverage Mipcom
FremantleMedia brings 'Familiar Taste' to MIPCOM

FremantleMedia is bringing a brand new title to MIPCOM 2016, which promises to leave viewers feeling warm inside. Familiar Taste sees well-known faces thanking those people who have had a major impact on their lives by sharing with them a surprise meal they have cooked themselves.

Specials Event Coverage Mipcom
MIPCOM: Beta Film delivers interactive TV-event 'The Verdict' throughout Europe

The interactive TV-event The Verdict continues its roll-out throughout Europe and will be simultaneously broadcast in six countries with additional territories to follow. The MOOVIE production by Oliver Berben (“Shades of Guilt”, “Hotel Adlon – A Family Saga”) will be screened in Germany, Austria,...

Specials Event Coverage Mipcom
'Inside the Masters of Dirt' on INsight TV to have non-scripted reality series in ultra-HD

INsight TV has commissioned a new, non-scripted reality series Inside the Masters of Dirt with XTreme Video, which follows the crew that produces the popular freestyle motocross arena show of the same name. Featuring fearless leaders in extreme motorsports, XTreme Video will be the first to present...

Specials Event Coverage Mipcom
MIPCOM: Cyber Group Studios signs deals with broadcasters, digital platforms

On the heels of MIPCOM Junior, Paris-based producer and distributor Cyber Group Studios continues to establish a strong presence worldwide by signing new agreements with buyers including major broadcasters and digital platforms for more than ten series of its catalogue. Deals cover players such as...

Specials Event Coverage Mipcom
Bloomberg Media Distribution signs Hollywood Reporter, Billboard, El Financiero, STAT as partners

Bloomberg Media Distribution today announced a partnership with a raft of premium publishers to provide business, technology, entertainment, music, lifestyle and health news to global audiences. Launched at MIPCOM, Bloomberg Media Distribution will distribute The Hollywood Reporter, Billboard, El...

Specials Event Coverage Mipcom

Latest News

Load More

Sign up for our Newsletter

subscribe for latest stories