2002 saw the build-up; 2003 will witness the flood


*NDTV, Star announce decision to part ways from April 2003

*TV news viewership more than doubles in two years

*NDTV, Aaj Tak announce Hindi, English channels

*Sahara announces slew of region specific news channels

*Ravina Raj Kohli appointed Star News president

There is an underlying theme for the continued growth of television news as a medium for public consumption especially post-9/11. And that is that news today has all the elements of what makes for entertainment - suspense, tragedy, comedy, horror and even soap opera. The Shivani Bhatnagar murder case, the December 2001 parliamentary attack, the Akshardham temple siege, the J&K elections, the "Modi-fying" of Gujarat and actor Salman Khan's incarceration and subsequent release on bail in a hit and run case immediately come to mind.


"Most of them will either close down or be taken over. Ultimately, there will be only two channels in each region/language."

Sun Network chairman Kalanithi Maran

(The Financial Express 30 July 2002)    


According to TAM Media Research, news consumption has more than doubled in the last two years. From an average of 51 minutes in December 2000, audiences across TAM's 15 cities now spend 136 minutes a month watching news. Ratings and channel shares for news channels also show a positive trend.

That interest translated into a host of announcements for news broadcasting ventures. The overriding question however is that increased interest in news notwithstanding, how many channels can viably exist in this space. Experts feel that if channels are able to create audiences, ad pie revenues will increase accordingly.

Adspend on the visual news business is expected to touch Rs 5 billion within three years, up from anywhere between Rs 2.5 billion and Rs 3 billion at present.

It is estimated that of the total television news ad pie, 76 per cent is going to the prominent satellite TV news channels (Aaj Tak, Zee News, Star News, CNBC India, BBC and CNN). The remaining 24 per cent is being farmed out between national broadcaster Doordarshan and the main general entertainment channels in the four southern states for news bulletins. Amongst the satellite TV news channels, about 90 per cent is shared between Aaj Tak, Star News and Zee News. Of this Aaj Tak is reported to have 45 per cent, Zee News 30 per cent and Star News 25 per cent of the pie. Out of the 10 per cent remaining, CNBC India takes 60 per cent, BBC 35 per cent and CNN 5 per cent, media buyers say.

But it is the success of the relatively young Aaj Tak that represents the news channel story in India. Aaj Tak, which broke even in seven months of its launch in January 2001 and made it to the top slot despite not having a first mover advantage, is what new players entering the field must be hoping to replicate.

According to TAM, the stickiness index for Aaj Tak is 43 per cent whereas it is 33 per cent for Zee News and 19 per cent for Star News. Aaj Tak in fact was the only media brand to figure among a host of FMCG brands in a brand evaluation exercise conducted by Business Standard in September.



"Earlier people used to watch entertainment first and news occasionally. Now, people watch the news first. September 11 has made this change happen faster"

Aaj Tak CEO G Krishnan

(The Times Of India, 14 April 2002)            

Aaj Tak has shown there is serious money to be made in this business.

And the risks are far less when compared to a general entertainment channel. A news channel has an operational running cost of Rs 450 million a year (for a business channel it is far less as most of the programming is in-studio). A general entertainment channel costs anywhere between Rs 2000 million to Rs 3,000 million (for a Star Plus kind of operation). It is these kind of running cost differentials that has so many players excited by the possibilities on offer.

Zee News also turned profitable during 2002, coinciding the turn in its fortunes with the change in its leadership, as Laxmi Goel, one of Subhash Chandra's three brothers was made the head of news. New initiatives like streaming on the news portal and tying up with cellular operators for news headlines on subscribers' cell phones are sure to fetch dividends. So much so that Goel asserts that Zee News will touch Rs 700 million in ad revenues by the end of this fiscal.

Then there is Star News. The split of the year has to be the divorce between Prannoy Roy's NDTV and Star. Though industry observers had seen it coming, it was made official in 2002. Star would take full control of Star News from 31 March 2003 and NDTV announced it would launch two channels of its own around the same time.

While the reasons for the break have been publicly ascribed to the fact that the five-year contract between NDTV and Star was loaded in favour of the former, the real issue was without doubt editorial control. Nowhere in the world has Rupert Murdoch abdicated editorial control of his news media outfits, whether it be print or television. And that was the principal reason for the parting of ways.

That Star is putting a lot behind this there is no doubt. It is reportedly pumping more than Rs 2.5 billion into the project and has hired the glamorous former HFCL Channel Nine CEO Ravina Raj Kohli as president. After getting a first hand understanding of the Fox News operations, Kohli has traveled extensively across north and west India to try and figure out just what it is that audiences from Surat in Gujarat to Faizabad in Uttar Pradesh want.

All that and more has been done so as to make sure there are no loose ends to be tied up when the divorce with NDTV goes through. As things stand though there is one big loose end that is out of the hands of Kohli and her team - getting uplinking permission for Star News as a foreign owned entity. The government is insisting that the proposal should be thoroughly examined before any okay is given as it is the first time that a foreign company will dish out news and current affairs programmes for a channel that is primarily targeting Indians and parts of South Asia. The latest information available on the issue indicates that the information and broadcasting ministry is likely to take some more time before preparing a case for Cabinet's consideration - something which I&B minister Sushma Swaraj has said she'd like to do.

While Star may be having birth pangs of sorts, NDTV seems to be sitting pretty. It is understood to have tied up a major portion of the funding which is necessary to start its news channels in April 2003. Merchant banking sector sources point out that some known FIIs have, in principle, agreed to extend funds and also that NDTV may soon announce a tie-up with a media company for distribution (Sony Entertainment's name crops up often) of its proposed channels.

While NDTV may have all its statutory clearances in place, there is still the issue of how its content will be managed and presented. It will already be a long way off the pole behind Aaj Tak and Zee News when its Hindi channel launches. And when its English channel launches, Aaj Tak's English sister will already be up and running.

The dark horse in the Hindi language space though may well turn out to be Subrata Roy's Sahara though. With huge financial muscle behind it, Sahara is set to launch three news channels in the next two months - Sahara Samay (its national Hindi news channel) and Sahara Samay Uttar are launching together, to be followed soon after by Sahara Samay Mumbai. There are four more channels to follow in the course of the year for Madhya Pradesh, Rajasthan, Bihar and Delhi.

Backed by state-of-the-art technology, Sahara is promising to shake up the news broadcast industry big time.

That's not all. There is also Jain TV, limping along somehow much like the Free Press Journal newspaper does on the print side. Then there are DD's news broadcasts, the regional entertainment channels where news bulletins are a key viewership driver (especially in the south), the regional news channels (Sun News being the biggest of them all) and news programmes on local cable channels.

The television news channel is certainly going to wear a crowded (overcrowded?) look in the next few months. The sheer numbers deserve an inventory of sorts :

TV Today Group - 2; Prannoy Roy's NDTV - 2; Star News, Sahara Group - 3 (to begin with); CNBC India, BBC, CNN, regional news broadcasts, local cable news broadcasts, and lastly white goods major Videocon's Bharat Business Channel. There is still no clarity though around just what it is Videocon chairman Venugopal Dhoot is putting together. And even more importantly - when?

Also, industry gossip says Kalanithi Maran's Sumangali, the parent company for the Sun group down south, is also planning a North India foray through a channel that will have news, current affairs and entertainment programming.

Sun TV is already looking ahead to launching a Malayalam news channel to add to its 24-hour Sun News channel in Tamil Nadu. It will be ironic if the new channel becomes a hit with viewers because Asianet initially had plans to launch a news channel but instead opted for Asianet World targeted at the expat Malayalee.

And it is not as if it is going to stop there. TV Today CEO GV Krishnan has been quoted as saying that a market for 24-hour news channels currently exists in Punjabi, Oriya, Gujarati, Bengali and the four south Indian languages.

If that were not enough, Nimbus Communications chairman Harish Thawani has told indiantelevision.com that he is also closely looking at the potential of launching a business news channel but that he would take a final call on it only around April when the news broadcast business environment gets clearer.

There is also the Old Lady of Boribunder (the Times Group) that has reportedly been toying with the idea of launching a business news channel for some time now, leveraging the brand equity the Economic Times has in the market. With the recent re-entry of Vijay Jindal in the corporate power structure at the family-held company, the whole project might just get some much-needed momentum.

"You ain't seen nothing yet." That was the message that Roy said he wanted to give out to the world while accepting "The Lifetime Achievement Award" at indiantelevision.com's Indian Telly Awards 2002, referring to the future impact the two channels he is independently launching would have. He will certainly have his task cut out to make good on that assertion. As will all the others who are jumping into the news channel fray.

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