The English news genre is seeing some action with new launches and rebranding galore, but the profitability battle is far from over
“Why were you lurking under our window?”
“Yes, yes, good point, Petunia! What were you doing under our window, boy?”
“Listening to the news,” said Harry in a resigned voice.
His aunt and uncle exchanged looks of outrage.
“Listening to the news! Again?”
“Well, it changes every day, you see,” said Harry.
— J.K. Rowling, Harry Potter and the Order of the Phoenix
News indeed keeps changing as fast as the time around us. And with the evolving needs of viewers, so does the news genre. In India, notably, the English news genre has been witnessing action of late. Earlier this year, Headlines Today rebranded itself as India Today Television. Zee Media Corporation Limited (ZMCL) in August announced its foray into this space with a new English News channel which is positioned as one that cohesively looks at South Asia instead of just India. The channel is likely to launch early next year. Earlier in 2015, Reliance owned TV18 Broadcast and Turner International’s CNN announced their split which will formally happen in January 2016. Consequently, the English News channel CNN-IBN, which was the result of a 10-year association between the two groups, is expected to be rebranded.
There have been reports of Turner being in talks with ZMCL as well to form a new partnership in India. Presently, the English general news genre includes other players like News X, Times Now and NDTV 24×7, whereas dotting the English business news category are players like ET NOW, CNBC TV18 and NDTV Profit, among others.
However, the sustainability of these channels remains a key issue as they manage to scoop up a very tiny share (0.08% as per BARC data) of the total TV viewing audience pie.
There is barely any argument against the fact that the English news space remains a highly influential genre, target as it does high income older males. It is a crucial category for advertisers targeting not only this demographic, but also decision- makers overall.
Rohit Gandhi, the newly appointed editor-in-chief, English news broadcast and related content at ZMCL, feels that Indian news has so far been a very hyper-local market in many ways, concentrating mainly on the two main drivers: politics and crime. However, times are certainly changing. “The genre has massive potential to grow. The untapped type of coverage that can be done can take the genre to a new level,” he says. Leveraging his own background as a documentary filmmaker, Gandhi hopes to establish the look and feel of the content as a major distinguishing factor of the new channel.
M.K. Anand, MD and CEO, Times Network, also attributes a lot of action in this space to digitisation, elections and the general improvement in the sentiment that started last year. When the India story improves, he says, this category becomes a major catalyst and stakeholder of that change. “What we are currently seeing is a very small part of what this category can become,” he muses.
Not a rosy path
Although the category comes with a bag of charming promises, it is constantly facing challenges—distribution being the most instrumental, unless the channel belongs to a larger network.
The common verdict is that English news channels which are not backed by a media behemoth that has a robust distribution network will suffer a great deal. Anand explains, “English news channels from independent companies will face a problem when it comes to distribution. So for example, Zee’s channel will get the benefit of their bouquet.
TV 18 gets that benefit. India Today and NDTV, for example, may find it difficult.” So independents running without the supporting framework of GEC/entertainment channels will find it a task to be profitable as the distribution will come at a higher negative cost. “It is a challenge in patches because a few players have it, but it is a fundamental challenge for the overall genre,” Anand opines.
What this also implies is that the category will remain reliant on ad sales for far longer than entertainment channels, which can spread their revenue expectations equally on ad sales (advertisers) and subscription (viewers) in the next five years or so. For the latter, this means that the content becomes that much more independent, a benefit that news channels should definitely get, but don’t. That is likely to continue having implications for content and quality with reference to sensationalism or the drive for leadership.
Jehil Thakkar, head of media at KPMG, feels that being networked is a great deal for an English news channel and that privilege allows it to even be non-profitable. “While the news channel by itself may not make money, it has a strong network effect. It creates a brand for the media enterprise. It creates a sphere of influence— both in business and politics,” he says. It also helps you build relationships with brands and companies that cover the demographic that you are targeting and that clearly helps the rest of the group.
Another major challenge is the rising wave of new media, and many audiences of English news channels seem comfortable riding it. The sharing of space is inevitable, but the task becomes doubly challenging for English News channels which will have to work harder to make sure the overlapping users don’t abandon TV sets.
According to the US-based Visual Networking Index (VNI) report for 2014-2019, the number of smartphones in India grew by 54% in 2014, reaching 140 million and the number will grow 4.7-fold between 2014 and 2019, reaching 651 million. KPMG’s Thakkar feels that this will remain a unique challenge for the next few years, as one has no way of finding out how the whole ecosystem will evolve.
In the meanwhile, the players in the genre will have to look at leveraging new media to their advantage. Zee’s new channel is planning to do that. “We are definitely going to be a cross-platform channel to add to our ability to get revenues,” says Gandhi.
Measurement is another problem. Mallikarjun Das aka Malli, CEO, India at Starcom MediaVest Group says, “For English news channels, measurement can also play a very big role. How nuanced is the measurement to represent these segments of viewing? If I had to slice the English news category further into, say, business news channels, the measurement doesn’t take into account these very fine segments.” From a media planning point of view, this is a huge grey area. If the ratings come and if the reach is there, then it’s easier for these channels to figure in the media plan.
He agrees that people have taken a call on some of these channels on the basis of qualitative consideration. There have been election years when there has been a lot of inflow of money for obvious reasons (election-driven advertising). “However, when there is business as usual, these channels are bound to justify themselves on an overall reach building capability to attract advertisers,” Malli says. “I think somewhere these channels need to work harder to prove themselves in the current scheme of things.”
An overcrowded niche?
With the increasing number of players in the market, each channel needs to work harder to establish and differentiate itself. Take the example of Colors, which entered a highly cluttered GEC category but quickly climbed up thanks to its good execution and distribution network. In the English news genre, a parallel of the Colors story can be drawn with Times Now—with the channel carving a niche for itself though it was a relatively late entrant.
Globally, Thakkar of KPMG thinks what Fox News has done — taking a very clear conservative stance—is a great strategy. “Having a unique identity is the key,” he says. So each channel needs a strong fulcrum— a strong anchor show—to revolve around, and essentially it has 2-3 hours to do that (primetime slot being 7.30-10.30 pm).
While a strong anchor is an asset, is it a good idea for a channel to be completely dependent on one personality?
Most English news channels are currently personality driven. It is almost impossible to imagine Times Now without Arnab Goswami, for instance. In fact, channel ratings are known to take a dip each time the star anchor goes on leave for a few days. However, as the consumer gets more options to choose from, she is soon going to demand good content and not sensationalism.
A slightly softer challenge is that a vision for this category as well as ad sales efforts have not really been injected with the imagination that they deserve. These are seen as smaller channels not only by advertisers but also by people who are selling these channels. “People will understand the real value of these channels when they start comparing the viewership of English news TV to the readership of English newspapers and realise it is not very different,” Anand points out.
For instance, he cites an approximate 60 billion viewership of Times Now on a monthly basis, which he claims compares well with leading newspapers. “But do the advertisers pay enough (in terms of CPT), as much as they would to a newspaper? Not really,” he says. This is because TV is traditionally seen as a mass medium, a cheaper way to reach consumers at large. “English news, however, is not at all similar to general television, and so it should have been sold like an English newspaper,” Anand says.
While these channels continue to face the test of times and changing market needs, India is still in the infancy of consumerism, Thakkar points out. So there is a lot of advertising potential still to come. “We have more and more luxury goods coming in. We have more Indians travelling abroad than ever. So there is a whole lot that this ecosystem can take,” he concludes.