Southern broadcast market to grow to Rs 225.4 bn by 2016: Deloitte

Southern broadcast market to grow to Rs 225.4 bn by 2016: Deloitte


MUMBAI: The size of the television broadcast industry in southern India is expected to grow to Rs 225.4 billion by 2016 even as programming mix shifts to shorter contemporary fiction shows to attract younger population and greater focus on different genres of non-fiction shows.

The overall television industry size in South India ? comprising Tamil Nadu, Karnataka, Andhra Pradesh and Kerala -- is expected to grow at a compounded annual growth rate (CAGR) of 17 per cent till 2016 from its current estimated size of Rs 122.2 billion, according to a report by consulting firm Deloittee on South India Media and Entertainment Industry.

It said the television industry in southern India is on the cusp of a new age as it leverages every dimension of its vibrant eco-system to create value for all its stakeholders.

Subscription revenue forms a major chunk of income for television broadcasters in south India. The subscription income at Rs 81.4 billion now constitutes about 67 per cent of the total revenues, while advertising at Rs 36.1 billion accounts for 29 per cent. The subscription income is expected to grow to Rs 151.7 billion and advertising revenue to Rs 65.4 billion by 2016.

While content revenue with four per cent share in total revenues is expected to grow from Rs 4.7 billion currently to Rs 8.3 billion.

In South India, Tamil Nadu and Andhra Pradesh have the highest share of TV subscription revenues at Rs 29.4 billion and Rs 26.6 billion respectively. While in Karnataka TV subscription revenue stood at Rs 16.4 billion, it was Rs 9 billion in Kerala.

By 2016, Tamil Nadu‘s subscription market is estimated to reach Rs 54 billion, while that of Andhra Pradesh to Rs 50.6 billion. Karnataka and Kerala are projected to reach Rs 31.2 billion and Rs 15.9 billion respectively.

The entry of state-run Arasu Cable in the distribution space has resulted in a significant change in the dynamics of the Tamil Nadu TV distribution scene, the report noted. With cable services being offered at Rs 70 per month by Arasu Cable, the subscription revenues in the state has witnessed lower growths as compared to other southern states.

"Going forward, as platforms, products and price points stabilise, Tamil nadu is expected to reach growth levels at par with other regioanl markets," the report stated.

Tamil Nadu currently dominates the Rs 36.1 billion television ad revenue market with a 38 per cent share followed by Andhra Pradesh at 26 per cent. Karnataka and Kerala have an identical market share of 18 per cent share each. The break-up of TV ad market is: Tamil Nadu (Rs 13.6 billion), Andhra Pradesh (Rs 9.3 billion), Karnataka (Rs 6.5 billion), and Kerala (Rs 6.7 billion).

The TV ad market in Tamil Nadu is expected to reach Rs 23.5 billion by 2016, while in Andhra Pradesh it is projected to reach Rs 18.3 billion. Karnataka and Kerala are projected to reach Rs 11.8 billion each.

The content revenue in Tamil Nadu is projected to reach Rs 3 billion from Rs 1.7 billion, Andhra Pradesh to Rs 2.3 billion from Rs 1.2 billion, Karnataka and Kerala to Rs 1.5 billion each from Rs 900 million currently.

According to Deloitte, non-fiction shows are steadily gaining prominence among viewers with genres like game shows, business, fitness, cookery, events and devotional programmes gradually carving their own niches.

The content is transcending from long-drawn soaps to shorter contemporary fiction shows that can attract younger audiences.

Non-fiction shows are also gaining traction with local broadcasters trying different formats to capture wide-range of age groups through these shows, the report added. The broadcasters in the south are also looking to invest in new content rather than just acquiring new movies, which has become an expensive proposition.

The report said local broadcasters are tying up with content providers to launch local versions of internationally hit formats. Sun TV signed up with Endemol for Deal ya no deal and Star TV inked a deal with Big Synergy to produce Kaun Banega Crorepati in three languages.

The report also pointed out that successful shows in the south are remade in Hindi language, a trend that is only going to grow stronger in coming days. The remake trend, according to Deloitte, allows broadcasters from south to cut costs and at the same time achieve greater scale and economy.

Kids genre an emerging market in South

The Deloitte report says the kid‘s genre in south is poised to grow with the entry of new players. Early entrants to the genre like Sun TV, which has four kids channels in its bouquet, have reaped benefits having captured majority of the viewers in this segment.

The main player in the industry is Sun TV with four channels - Chutti TV, Kushi TV, Chintu TV, and Kochu TV in Tamil, Telugu, Kannada and Malayalam respectively. Other kids? networks like Disney, Cartoon Network, and Nick are new entrants to the market with the launch of local feed.

Having a potent content supply pipeline from domestic as well as international players will help the genre grow in south.

News broadcasters

The news genre in the south is witnessing a new breed of channels which are also climbing up the viewership ladder due to their unique content offering. Channels like Puthiya Thalaimurai in Tamil, V6 News in Telugu and Public TV in Kannada are among the news channels launched recently.

The report noted that news channels with political leanings are also flourishing across the southern states. These broadcasters are expanding into entertainment genre and print media after tasting success, the report stated.

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