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The Business of News

All of us in the business will agree that 2009 was not the best of years. But the good thing about it was that the world of business learnt the hard way that business is not just about excel sheets and that the valuation on those excel sheets does not attract attention in a hurry.

Media was possibly one of the worst hit sectors across the world. Quite logically so; one of the first cost cutting steps, if not the first, is usually, if not always, slashing of advertising expenses. More often than not, in recessionary circumstances, advertising is no more considered as an essential investment.

News industry in India, however, was not that badly hit as the country went through a General Election. But there’s much more in the news on TV News industry! Read on...

News television is supposed to have two distinct identities. As the fourth estate, it is supposed to inform and empower the viewers, work as a watch dog to the policy makers and implementers. It is supposed to perform the role of a facilitator for our citizens, many of whom are disadvantaged and aggrieved, or for those groups which believe they have a legitimate and justifiable grievance against the powers that be. All this requires us to act as custodians of public interest. The other identity is as private sector organisations we are bound by the rules of the big bad market of balance sheets and ROI.

Most people seem to think that these two distinct identities are at conflict, but I‘m willing to take a bet that they are not. But we sure have a lot to worry about - both our public and private interests.

First about our reducing role in the public interest space. The viewership (GRP) figures of news television in India paint a disquieting picture. The GRPs slipped from 236 in 2007 to 221 in 2008 and to 166 last year, a 30 per cent shrink in just two years. I am at a loss to pinpoint a particular reason for the slide. However, regional channels are robustly augmenting. As a thumb rule, a regional news channel should have 70 to 80 per cent local news. Are audiences then more interested in closer home realities than the larger canvass?

Are viewers deserting news channels? Is there a significant change in rating base which has caused this decline? Does our gut-feel endorse these slipping numbers?

Let me cite a small anecdote. Once when former US president Lyndon B Johnson was asked his views about the media, he had quipped: “If one morning I walked on top of the water across the Potomac River, the headline that afternoon would read: "The President Can‘t Swim."

He may have said this decades ago but it captures to a great extent how Indian media too can influence or draw interferences from a simple and straightforward piece of news. In the spider-web of competition, the truth sometimes gets strangled. But is that all? I wish, it was.

Like for instance, what would you call “Breaking News” in today’s context? Before that, how would you define “News” ? In my own understanding, reporting of any incidence that is “topical” and “relevant” is news. Tabloid journalism possibly compromises with the relevance factor, but still remains topical. And thus “breaking news” would be an initial (ideally first!) reporting of an incident or development which would be relevant for a certain section of audience.

But the Indian news media has redefined “Breaking News”. It could be anything from what the babas and tantriks have to say to what the astrologers’ take on eclipses is, what the cats, dogs, snakes and the likes are engaged with! This unthinking, wavered ways of the news channels has taken the sheen away from the respect we used to command as organisations with social responsibility.

Thankfully, we in our ( Zee News Limited) news channels do not have such wide canvas for “Breaking News” and our editors still stick to the literal translation of the two words under reference. And it was thus with some sense of concern, as also with an equal feeling of social responsibility, that in May 2008 Zee News took a conscious decision to break free from the trend of hype and hoopla. Respecting the intellect of Indian audience, we brought our focus back to facts, analysis, perspective, reportage and the likes. I can say today, with some satisfaction, that we have not wavered from our path since, despite pulls and pressures from the policies of competition. We held steadfast in dishing out for our viewers news that was accurate and relevant, across all bands and in all languages that we deal with. Clearly, our guiding principles worked and we witnessed all-round growth across channels.Let’s now look at the business of news. Did you notice that the sole criterion that a media brand or organisation is evaluated in India is nothing but the TRP numbers? Logically there’s nothing wrong in it as higher TRP would lead to higher advertising. Advertising is still about 80 per cent of the broadcast sector‘s revenues in India and hence that should lead to higher profitability. However, in India, as known to most by now, profitability is not just TRP numbers. Rational cost structure, innovative strategy, network economy of scale etc have significant influence on the way business is done and hence on the bottom-line of any business. Thankfully, the economic recession has brought the attention back to current bottom-line. Valuation is no more the buzzword. Current deliveries are at the core of all decisions with respect to a business outfit. While the marketing and programming departments still get credit for the TRP numbers, the business leaders would have to wake up to serious questions on returns and profitability from those who are funding the businesses. I assure you that the TRP rankings and profitability do not always have a direct corelation. At least in our case the latter far out-performs the former.

Yet, I‘m not without hope. As an eternal optimist, I feel that the future of news TV is far more promising than what seems on the surface. The industry body, the News Broadcasters Association (NBA), has come up with commendable achievements in its effort to self-regulate. It is encouraging for NBA to get significant acknowledgement from the Ministry of Information and broadcasting.

I firmly believe that the most potent regulator has always been the “market”. Here in our case, finally the audience has the last say on what they want from news TV and they would make their verdict loud and clear, eventually. And then digitisation would ease out the distribution bottle neck and the news genre would experience explosive growth. As I have always mentioned, regionalisation of TV would be a primary growth driver.

As I debate the minutiae about dropping viewership trends in my mind, I feel that there is no one distinct phenomenon for the present exodus and it is possible that it just a matter of perspective.

So I leave it to you to mull it over as well.

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