The Future of News 2009: Local news is about relevance

By Neha Kalra and Sumantha Rathore , afaqs!, New Delhi | In Media | August 03, 2009
The word 'local' stirred up various opinions amongst the gathering present at the event

In the last panel discussion of the day at The Future of News 2009, senior members of the advertising, media and marketing fraternity focused on the obsession of the media with local news.

Vanita Kohli-Khandekar, media consultant and author, was the moderator for the discussion, which included interesting panellists such as Suprio Guha Thakurta, managing director, The Economist Group, India; Ramesh Natarajan, deputy country manager, South Asia, DHL; Seema Mohapatra, regional director, advertising sales, South Asia, BBC Worldwide; and Dilip Cherian, founder partner, Perfect Relations.

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Opening the discussion, Kohli-Khandekar spoke about the reality that news is not only about viewers (in the sense of television only) but mostly about the audience, which is always interested in knowing more about what's happening in the locality. However, the problem remains that there aren't many media outlets to provide the news. This brought into focus two important aspects of news coverage today.

Firstly, she said that technology has permitted the media to distribute news in various formats such as satellite editions of newspapers, the Internet, direct-to-home (DTH) or even mobile.

Secondly, a whole new category of advertisers have cropped up, whose local needs are stronger than their national requirements. With retail chains and various financial service companies spending almost 80 per cent of their money on local advertising, Kohli-Khandekar reasoned that these two factors have definitely made monetising local news both possible and profitable.

Throwing open the discussion, she questioned the panel about whether the appetite for local news is going up. Mohapatra responded by saying that apart from the appetite going up, the choice for local news, too, is also going up. However, she added that all news is local and all news is global - it is about what the consumer wants and where he is going for it. "News is getting relevant - what affects you is getting more relevant," she emphasised.

Mohapatra added that one does want to have a look outside, and is interested in international developments such as the economic downturn which could affect him personally. "Recently, in the US, when the real estate prices went up, the hopes in India went up, too," she said.

Natarajan, speaking on the marketing perspective, went on to express that every component of the advertising that they do as marketers requires a local component - in his words, "it is where the rubber hits the road".

"At the end of the day, I want to attract maximum footfalls to my store. It is not about the TRPs, it's about how many people come to the store when I do advertising and how many people buy," he said.

According to him, there has always been a market for local news. It is just that gathering the news and the economics of news distribution did not make it viable. He said, "Probably the Internet, combined with trends of citizen journalism, has made things easy. It's not just retailers who are interested in it - every advertiser is interested in it."

Citing the example of the US, where 80 newspapers had shut down, Thakurta of The Economist brought out that it wasn't that the people in those communities did not want newspapers or that there was any dearth of news. It was simply that they were not viable business models any more.

"Similarly, in India, local news is definitely important, but whether it is viable as a business model - I'm not too sure about that," he concluded.

Voicing the opinion of the public relations (PR) field, Cherian was brutally honest when he said that local news was actually boring. Local is what one encounters every day, and is actually bombarded by it. If The Economist and Forbes took out Indian issues, people would never read them. He said, "I buy what is global because of the very fact that it is global - the moment it starts diluting to become local to me, it goes for a toss. Global products that are tweaked with a local touch are dead products for a consumer."

He also confessed that the PR section localises the global matter so that media takes it in a local flavour - it's spun or trimmed to make it more appealing. "Local is a hook - it is to get attention and eyeballs. In the chase for the local, it ends up diluting the product profile or offering for a larger audience," he said.

He further added that speaking in the local language or in a language that the audience understands doesn't make one local. "It is about the only language you know and that's the only way to access whatever I wish to. For me, local is my Facebook and Twitter log. Local is getting redefined from the consumer's view, media's view and the spin doctor's way of looking at it," he explained.

Natarajan added that it is more about the logistics that are involved in bringing out the local editions and less about whether those editions are read or not - according to him, those editions are undoubtedly read widely.

The next obvious question was how global brands, along with being global, could also be relevant? The media makes a mistake in that it doesn't put enough value to what it offers. Indebted to advertising, it has destroyed the value of its brands, he believes. He added that The Economist makes money on circulation, without advertising. He emphasised that if one gives people what they want, people will pay for it, and added that if one can't be profitable purely on selling the product, he shouldn't be doing business.

He quoted the Internet as the rationale behind papers shutting down in England. The sources of revenue such as local advertising from property and local affairs had shifted to the Internet.

Keeping in mind the advertisers, the obvious decision was whether brands are big enough to adapt to the Internet or being present across geographies.

Natarajan remarked that there's a huge market for local content that is being provided by STAR. "About making these biz models work - the structure of the media is that a few large organisations own the medium - the money is not going to come back to the Internet."

Mohapatra revealed that local channels carried news such as Michael Jackson's death and Obama being made President extensively, and the ratings went up, too. Also, in the non-commercial part of World Service Radio - Urdu, Tamil and Hindi, people consume local and global news in the local language.

Cherian emphasised that facts are free; information is free. "With pipes getting cheaper, where you can make money is the analysis. If you have a perspective, people are willing to pay for your perspective, especially if you're right. If you choke the pipe, then you have to be a brand which has the ability to extract money. If you have a venture capitalist investing money in you, then you better be this humungous brand which is able to say - 'This is analysis, we will be right, so follow us and pay for it," he elaborated.

The discussion subsequently moved to the issue of the English media waking up to the potential of local news, particularly with language newspapers leading the pack (citing the example of the Jagran group, with its 230 editions).

Cherian clarified that it was a mistake to put language newspapers under the silo of local. Editorial mix has one local hook - getting the land mafia organised or pleasing the local politician - its local only for a certain purpose. "Local is also a means of driving a certain amount of revenue. It is about a certain language and they are making the news accessible to you."

Natarajan agreed that local is different to different people, differently.

The discussion ended on the realisation that local was not about what's relevant to a particular set of people at a given time - it was about relevance per se.

The event was organised by afaqs! and sponsored by STAR News, Hindustan Times and Mint.