Trai order: Niche TV to pay the price?

Mumbai | Published: February 17, 2019 4:22:42 AM

The FTA pack consists of 100 channels in total and of these, about 25 channels are Doordarshan channels or local cable operator channels.

Telecom Regulatory Authority of India, trai, television industryTelecom Regulatory Authority of India

By Sonam Saini

The Telecom Regulatory Authority of India (Trai)’s tariff regime implementation for TV channels has been extended till March 31, but what hasn’t changed is the uncertainty looming around its possible impact on the television industry. Although there is little to worry about in the minds of broadcasters when it comes to the continued consumption of Hindi general entertainment channels or movie channels, the concern is more to do with niche channels, like those in the English entertainment, lifestyle, infotainment and music space.

As per media experts, niche channels of large broadcasting groups that are not included in any bouquet could fade out in terms of viewership, as consumers will not look at buying them on an à la carte basis. Such channels anyway command a smaller audience share compared to mainline channels.

Speaking specifically about the music genre, Punit Pandey, chief business officer, 9X Media, says, “The BARC ratings reinforce my belief that free-to-air (FTA) channels will be benefited under the new tariff regime.”

9X Media, which owns five music channels — 9XM, 9X Jalwa, 9X Tashan, 9X Jhakas and 9X O — are FTA channels. “Music as a category is an important part of consumption whether it is video or audio. We have had commercial deals with all the relevant cable operators. I don’t see why they wouldn’t carry our channels,” Pandey states.

But when it comes to pay channels, as the power to select will be in the hands of viewers, the pressure on strong content has never been greater. Prathyusha Agarwal, CMO, Zee Entertainment Enterprises Limited (ZEEL), shares the strategy for the broadcaster, saying through consumer interactions, the company has observed that consumers are still quite “likely to buy channels as part of a bouquet”. “We have created a mix of relevant channels straddling across the genres of entertainment, movies, lifestyle and world news,” she adds.

The FTA pack consists of 100 channels in total and of these, about 25 channels are Doordarshan channels or local cable operator channels. “Firstly, there is a huge tussle between channels to get into the remaining 75 mark and a large portion of that is also taken up by news and rural channels,” shares Karan Taurani, VP, Elara Capital. “So, niche channels trying to get into the FTA mark will be a rather challenging task.”

Discouraging bouquets among consumers and promoting à la carte channels could adversely impact niche channels which were earlier offered as a part of a larger bouquet; this may lead to TV channel groups discontinuing such channels and moving them to an OTT-only format. This in turn could have a negative impact on subscription revenues for the TV segment, media experts suggest. Another scenario, as per Taurani, is that of consolidation. “One might see bigger networks buying out these channels or these channels could simply move to the digital platform.”

According to KPMG India’s media and entertainment report for 2018, the English GEC genre showed 8.5% growth in AdEx (advertising expenditure) in FY18, despite the pressure on relative positioning in English viewership on account of the measurement methodology change. English movies registered 3.3% growth while Hindi music witnessed 5% growth in FY18. Infotainment recorded a 2.3% growth, whereas the AdEx of English music and lifestyle saw a decline in FY18.

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“The reach might go down of niche channels if consumers don’t subscribe,” says Vineet Sodhani, CEO, Spatial Access. “For example, if Fox infotainment channels come under the Star bouquet and the consumer pays Rs 50-60 for it, it shouldn’t be a problem but the standalone infotainment channel may see a dent.”

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