Have news channels reached their peak?

By Anindita Sarkar , afaqs!, Mumbai | In Media Publishing | April 28, 2011
The viewers seem to be disinterested and the heat from other genres is singeing news channels. Is it all downhill for them from now on?

Bad news is staring news channels - both English and Hindi - in the face. According to TAM Media Research, at the all India level in the C&S 4+ age group, the share of all news channels (English, Hindi and regional) dropped from 8.1 per cent to 7.3 per cent between 2008 and 2010.

Hindi channels are feeling the pinch more. The genre share slipped from 4.8 per cent to 3.4 per cent while for the English news channels, the corresponding figure fell from 0.6 per cent to 0.3 per cent. Regional channels, however, were the exception. Genre share of these channels grew from 2.7 per cent to 3.6 per cent.

It's not just about shares. The GRPs of news channels (CS 15+, All India) - a combination of reach of the channels and the time spent by the universe - also dropped from 18,282 to 16,506 in two years. While English news channels saw GRPs sliding from 1,705 to 1,048, those for Hindi news channels went down from 10,258 to 7,589. Regional news channels' GRPs went up from 6,307 to 7,658. During this period, the average weekly reach of news channels maintained their status quo at 79 per cent approximately but the average weekly time spent on a news channel dwindled from 105 minutes to 95 minutes.

So, what's the big deal about news channels losing a bit of their viewership to other genres? Why are they so important? One big reason is that, apart from the clout that news channels enjoy, the ad revenue is quite disproportionate to the viewership they command. Compared to other genres, news channels get more money even if their viewership is smaller vis-à-vis a general entertainment channel (GEC), for instance.

No news is not good news

One big reason which media observers attribute to this situation is that news channels do not have any control over the shaping of content and are dependent on external stimuli.

The common belief that there is nothing like a good disaster to get viewers back. Natural calamities, terrorist attacks or wars push up viewership of news channels. That happened in 2008 when the growth of viewership was primarily spurred by the coverage of the Mumbai terror attacks and the political crisis in India over the Indo-US nuclear deal. In 2009 and 2010, for instance, there wasn't any major event that could shake the entire nation for days or weeks except for the IPL.

GECs have also contributed by taking away viewers. Media practitioners say that the options for viewers have widened in the last few years. There are more general entertainment channels (GECs) as well as more fiction and reality shows available. The news channels' loss seems to be the Hindi GECs' gain. Between 2008 and 2010, the share of Hindi GECs increased from 23.2 per cent to 29.6 per cent in 2010.

Besides, unlike Hindi and regional GECs, viewership of news channels is led by a relatively small demographic set - men aged 25-54 across SECs. On the other hand, GECs featuring reality shows, awards, movies and events are watched by the entire family.

"The main reason for stagnant viewership of news is its over-dependence on a small demographic base," says Sudha Natrajan president and chief executive officer, Lintas Media Group. What will make the base expand?

Change, or else...

News is unlikely to expand its viewership base unless the youth get pulled in and this expands the audience base. "It will be status quo in terms of channel shares for the next three-five years at least till a major demographic change happens," says Natrajan.

But are the GECs and external events the only reasons behind dipping viewership of news channels? Media observers feel that news channels are to be equally blamed for this situation. "While consumers' interests are expanding, channels are not doing enough to differentiate their content and that has to change," says Sunil Lulla, managing director and CEO, TV Business, Times Television Network.

In the last few years, news channels have moved from a feature-led format to solely a breaking news format, which has minimized the stickiness on the channels (evident from the drop in time spent). A senior media observer says, "Viewers come in when news breaks and move out equally fast."

The fierce competition amongst the news channels to get that extra share of revenue and get ahead in the race for GRPs has led to an increase of sensationalism. The line between news and entertainment channels is increasingly getting blurred. Smaller, non-network channels that have their own set of audiences and advertisers tend to get into 'masala news' in search of more eyeballs. But such sensationalism also puts off viewers. News today is available all through the day and because all channels exhibit a 'sameness', audiences are not worried of missing out on any news occurrence. This has affected appointment viewing drastically.

Says Nandini Sardesai, sociologist and member of ASCI's CCC (Consumer Complaints Council), "India is still a single TV household society and there are many options on TV. Therefore, people choose to watch news 'later' because they know that anytime they switch to news, the mainstay information of the day will still be available."

Deepak Lamba, business head, BloombergUTV, voices a similar opinion. "Many news channels are working on the old strategy of creating one package for different time bands. Consequently, they seem to be lacking in innovative news programmes, which could be of interest to a larger set of TV viewing people, rather than just their core TG." Then, how are regional channels doing better?

Regional rule

Be it external stimuli or competition from other genres, it is the same rule that applies for Hindi, English or regional news channels. However, what's interesting to note that the last-named has increased market share while Hindi and English are losing it.

One reason is that the number of regional news channels has increased in the last few years especially in languages such as Bengali and Marathi. More channels, more viewers, is the simple logic. But there is another reason.

First, the viewers who usually watched Hindi news moved to the regional news channels because of an affinity for their mother tongue. As Shailesh Kapoor, chief executive officer and co-founder, Ormax Media, says, "There are many states in India where the primary language preference is not Hindi or English. As the number of regional channels continues to grow, the shift from Hindi and English to regional is a natural phenomenon. Also, localisation of news is the biggest strength of regional news channels." It is the south-based channels that have led the growth in the regional space. "Mushrooming of news channels is a phenomenon in the South, especially in Andhra Pradesh," elaborates K Satyanarayana, vice president and communication partner, Media Direction. Currently, there are 16 Telugu news channels (24-hour) in Andhra Pradesh and more are expected to be launched soon.

"The south, in any case, traditionally has been more news consuming than the rest of India and is the only region where news forms part of the programming mix of leading GECs and command as much rating - and advertising - as any popular serial," adds Satyanarayana.

In their defence

Ask broadcasters and they become quite defensive about the whole issue. At the same time, they point out signs of hope. "A vast swathe of potential viewership in rural and semi-urban India still remains relatively untapped," says Saket Saurabh, Head, Marketing - CNBC-TV18 and GM - Corporate Development - TV18.

The news genre, notes G Krishnan, executive director and CEO, TV Today, went through a phase of exponential growth between 2005 and 2008. "Currently, we are witnessing consolidation," he says. That is flattening and pushing down the genre viewership.

Krishnan further adds, "News channels are under tremendous pressure to increase revenue and become profitable. This is leading to ad hoc cost cutting, resulting in lower investment in newsgathering and brand building. This is bound to have a detrimental effect in the long run."

In the race to get to the No 1 slot, news channels are spending heavily on distribution, which is a big burden. Because of low penetration levels of direct to home (DTH) services in India, the distribution costs are much higher than the cost of content generation for most of the channels. Covering these costs takes priority and leads to most channels compromising on programming as well as the quality of content, say observes in the industry.

Says a top executive from an English news channel on condition of anonymity, "Distribution eats up so much money that there's little left over for anything else. It costs approximately Rs 45 crore to distribute just one English news channel. That's more than the wage bill and news gathering budget of most channels."

While Hindi news channels spend Rs 30-40 crore in distribution, for regional channels the pricing depends on the market dynamics of that local market. Overall, the TV news industry spends about Rs 600-800 crore on distribution, which is one fourth of the Rs 2,300 crore that it corners as advertising and subscription revenue.

The same executive further notes that distributors take away almost 90 per cent of the TV industry's profit. But it's ignored as the issue is basically political. "Local politicians and goons control and milk C&S distribution. Sadly, many major TV channels also run distribution companies - even in the TV industry, not all are fighting for a rational distribution setup," he says.

The ball is, at present, firmly in the court of the news channels. How they woo back their lost viewers will be an interesting battle to watch. After all, they wouldn't want to slide off the pedestal that the genre offers and the power that comes from being a news channel. The only way they can stay ensconced in that comfortable position is to get the viewer back in front of the television while the news pans out on screens countrywide.

(This story was based on further interviews with: Anand Halve, director, Chlorophyll; Anand Kumar, a senior sociologist at Jawaharlal Nehru University; Anita Karnik, Mindshare's principal partner,-invention; Anita Nayyar, CEO, MPG; Jehangir S Pocha, co-promoter and Editor-in-Chief, NewsX; Navin Khemka, Senior VP, ZenithOptimedia; Neeraj Sanan, VP- marketing and distribution, MCCS; Prabhakar, head, CMS Media Lab and Vaishali Sharma, Marcomm Head, BBC World News.)