Benita Chacko

"What excites me most is AI - what worries me most is AI"

In a candid interview, Times Internet COO Puneet Gupt shares his learnings about monetisation, business economics and technology.

Digital publishing has witnessed phenomenal changes during the last decade. Not only has the technology transformed but also the content demands and revenue strategies.

After working for over a decade at India's largest online publisher, Puneet Gupt, COO, Times Internet, has a ringside view of this evolving landscape. When he joined the organisation in 2012, the news business had 40-50 million users. It now exceeds 100 million users across various properties.

In an interview with Sreekant Khandekar, co-founder, afaqs! at the 4th edition of afaqs! Digipub World, Gupt delved into the ever-evolving world of the publishing landscape. He shared his learnings, Times Internet's growth journey, its monetisation strategies and his expectations from AI.

Edited Excerpts:

What significant lessons have you acquired over the past decade at Times Internet since you joined?

The lesson learnt is to leverage tailwinds during supportive times. During 2015-19 audiences were coming in droves. These early online adopters were mobile-first users and today they form 95% of our ecosystem.

How did you leverage the influx of audiences during that period?

Initially, we capitalised on the surge in online audiences by amplifying our existing Bennett, Coleman and Company Limited (BCCL) print properties like Times of India, Navbharat Times and other regional publications. But we also introduced new ones such as Tamil Samayam, Telugu Samayam, Malayalam Samayam, I am Gujarat, News Point, etc. As the audience growth slowed, we shifted focus to enhance engagement. This led to launching new categories like ETimes, Gadgets Now, Happy Trips, and Times Food. Adapting to changing buying trends, we moved from cost-per-day to CPL, CPMs, performance-based, native advertising, and social advertising. While direct buys remain valuable, we embraced programmatic and performance-based approaches to align with advertisers' needs.

Could you provide a breakdown of your revenue between programmatic and other channels?

Currently, we're roughly split 50-50 between direct and programmatic revenue, varying by property. Premium properties like TOI and ET lean more towards direct sales, while languages show less direct share. Performance advertising constitutes around 10-15% of revenue. Within direct sales, non-performance brand solutions comprise 30%, while standard banner ads make up 70%.

Have you observed any major shifts in the business economics over the past decade?

Certainly, costs have surged significantly over the years due to various factors. One pivotal factor is catering to multiple platforms. Initially, we tailored content mainly for desktop, but now we must address mobile, AMP, PWA, Android, and iOS separately, leading to custom products for each platform. This diversification heightened expenses. Additionally, as we expanded content variety, reliance on our print resources diminished, requiring more teams and resources solely for online content creation. This impacted technology, product development, and content expenses. Simultaneously, the evolving trend of content multiplication has strained CPM growth. While Indian language content grew exponentially, advertising failed to match this rate, pressuring yields. Consequently, efforts to counter this involved increasing ground-level staff, but this didn't necessarily translate into proportional cost efficiency, thereby further affecting overall costs.

"What excites me most is AI - what worries me most is AI"

What is the current size of your news site team, and what proportion of them are dedicated to content creation?

The news site team is sizable, comprising around 3,000 individuals. Approximately 600 to 700 are dedicated content creators or digital editors, exclusively focused on digital platforms. Additionally, we benefit from content contributed by our parent company.

Your group has been quite persistent and proactive in transitioning towards pay models, exploring different strategies over the years. Could you outline the major initiatives you've undertaken?

When it comes to subscriptions, our initial focus wasn't solely on revenue. Instead, it centered on augmenting users' ARPU in the digital media landscape. ARPUs typically stood at under Rs 20 per year per user, and even lower, below Rs 10, in Indian languages.

With around 600 million users within Times Internet's reach, our objective was to leverage the Times Internet flywheel for exponential growth. Our aim was to boost user spending within our ecosystem. This led to the inception of Times Prime, a membership offering encompassing our properties, external products, and exclusivity. For a yearly fee of Rs 1000 to Rs 1200, users gain premium perks. Simultaneously, we delved into creating reader-focused payment products for TOI and ET.

I noticed that Times Prime includes services like Sony Liv and Disney+ Hotstar. Sometimes these services seem to overshadow Times properties. Considering your extensive collection of news and features, why did you opt for this approach?

The main objective with Times Prime was to embrace subscriptions and reader payments to foster success. Our approach at Times Internet is business-centric, prioritising what's best for the particular business segment. If Times Prime sees the most engagement through TOI content, that's fantastic. However, if OTT content drives higher consumption, we'll integrate OTT products within Times Prime. Our guiding principle is consumer-centricity; solving consumer problems is paramount for growth in our ecosystem.

Think of it this way- there are super fans and casual fans of your content. A super fan of Economic Times might happily pay Rs 2500 annually, whereas a casual fan of TOI, Gaana, and Sony LIV might not want to pay separately for each of these products. We cater to both by providing options like ET Prime, TOI Plus, and Times Prime. This strategy targets both casual fans attracted to bundles and dedicated superfans seeking pure content experiences.

Leveraging a strong brand like ET to attract independent pay subscribers must be promising, especially with loyal and passionate fans. How has the experience been with ET?

Indeed, that's the case with Economic Times. Our individual pay subscription model has been remarkably successful. In just four years the subscription revenue accounts for about 20% of ET's ad revenue. Both ET Prime and TOI Plus have reached close to 200,000 paying users each. This achievement provides us with strong internal conviction, a critical step before inspiring others. With this experience, we're confident that subscription isn't a passing trend but a sustainable revenue source. Real subscribers, renewals, and solid retention rates in the range of 50-70% reaffirm this perspective.

Could you provide the renewal rates for TOI and ET subscriptions and highlight any notable differences between them?

ET boasts the highest renewal rates, followed by Times Prime and TOI. However, all these products maintain renewal rates exceeding 50%.

What aspects of your pay initiatives have not gained traction?

For us, micropayments have not yielded positive results. We've invested in understanding propensity to subscribe instead. We believe that part of a subscription sale is due to the product's value proposition, and part is driven by an immediate need to consume specific content. Selling content individually disrupts the conversion to larger subscription plans. This led us to develop different subscription models based on users' propensity to subscribe. Those with higher likelihood receive distinct offerings, while those with low propensity may not even see the paywall, as it can lead to inconveniences and push users away. This learning has enabled our teams to effectively manage both subscription and advertising-based models simultaneously.

Looking ahead, what aspects excite you and what concerns you?

What excites me and worries me is AI. Traditionally, we saw digital publishing as a blend of technology and content. However, we foresee a future where human intelligence (HI) and artificial intelligence (AI) are equally vital in digital publishing. This shift is significant. For instance, tools like GitHub Copilot already enhance developer productivity multi-fold. We've established AI-focused teams within Times Internet, engaged in various AI content endeavours. Presently, we can translate across languages, summarise content, create bullet points, and even convert Hindi videos to English with synchronised voiceovers. These projects are both live within our CMS and nearing completion in the QC phase.

Event partners include MGID, YuktaMedia, Quintype, Chartbeat and (Bronze Partners) and IndiaDotCom Digital (online partner).

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