ITV

Category: Year Enders

  • ‘Rolling out of Cas has been the most significant development’

    ‘Rolling out of Cas has been the most significant development’

    One of the most significant developments of the year has been the re-emergence of Zee Network and especially Zee TV as a clear market leader in the entertainment segment when it surpassed its closest rival Star. Its ‘reality show’ Sa Re Ga Ma Pa registered an all time high TRP/viewership amongst different age groups.

    Zee Network has also launched a new youth centric family entertainment channel ‘Zee Next’ in December 2007. With BAG Films, NDTV, UTV and TV-18 also planning to bring channels of different genres, the viewers can expect a wide variety of content in 2008.

    However, the year has not been so good for sports channels having cricket/BCCI rights as after losing legal battle they had to compulsorily share their feed with Doordarshan in respect of One Day and Test matches under the downlinking guidelines.

    The attempt on the part of government to create consensus on the Broadcast Bill received a setback when certain entertainment channels and news channels opposed to the introduction of the Bill, forcing the government to defer its introduction. Most of the media houses have expressed the view that rather than the government stipulating content code by way of legislation, they would like to have a self-regulatory content code.

    With BAG Films, NDTV, UTV and TV-18 also planning to bring channels of different genres, the viewers can expect a wide variety of content in 2008
    _____****_____

    They apprehend that proposed bill and content code is an attempt on the part of the government to curb the freedom of press through the back door. However, at the same time there has been a vociferous demand from various section of society to impose some kind of control on the ‘unregulated content’ being currently beamed.

    I am of the view that there is an imperative need to have a regulatory regime in the broadcasting sector and the Broadcast Bill is a step in the right direction. The proposed legislation contains various provisions which are not only in the public interest but also in the interest of the broadcast sector, which would not only bring order in the sector but would also stimulate the much needed investment so as to provide an opportunity to the sector develop and grow in a focused manner.

    While there are certain provisions in the bill e.g. provisions pertaining to cross media ownership and restriction in holding shares within electronic media and distribution sector which may act as an impediment to the overall growth of the sector, the media sector has brought to the notice of the government that the present era is that of globalisation and consolidation by way of merger and acquisition, and these kind of restrictions act as barriers for accessing and optimally utilising the resources of capital formation for the growth and development of the sector.

    The Indian media industry, especially Indian broadcasters have to compete with global media companies. In order to match the might of those companies, they must have adequate technology, capital and manpower resources. Thus, the process of capital formation is one of the key ingredients to acquire and accumulate competitive strength and these kinds of restrictions are unwarranted. The government has fairly agreed to review these provisions and has also entrusted the task of developing a draft content code to News Broadcasters Association.

    In my view the industry should welcome the Broadcast Regulator, as an effective Regulator protects both consumer interest and the industry from arbitrariness
    _____****_____

    In my view the industry should welcome the institution of a Broadcast Regulator in as much as an effective Regulator protects the consumer interest and also protects the industry in question from arbitrariness and interference of the government of the day. The media industry has grown too large and too complex and as such it is in the interest of broadcasting sector itself to have a Regulator. However the Regulator must be autonomous, and independent of the Executive.

    Towards the fag end of the year certain court orders and judgments have also come, in which there have been observations that Broadcasters/Media need to observe general community standards of decency and civility in news content, taking particular care to protect the interests and sensitivities of children and general family viewing. The Courts have directed the government to expeditiously bring the content code in the Broadcasting sector.

    It is high time the industry responds to this and effectively works with the government in finalising an appropriate self-regulatory content code at the earliest.

    There have been a lot of regulatory developments during the year. Trai has brought out Quality of Service Regulations for DTH which outline service bench marks to be followed by DTH operators. This particular Regulation mandated the commercial inter-operability for Set Top Boxes (STB) in DTH service.

  • ‘Rolling out of Cas has been the most significant development’

    ‘Rolling out of Cas has been the most significant development’

    Lots of consumer centric stipulations have been made in the said Regulations which, among other things, include establishment of call centres by DTH operators, redressal of consumer complaints within stipulated timeframes and the concept of Nodal Officers to be appointed by DTH operators.

    Trai has also issued Interconnect Regulations for DTH services mandating the Broadcasters to come out with Reference Interconnect Offer (RIO) for DTH operators and provision of channels on a la-carte basis by broadcasters to DTH operators under the said RIO.

    Trai has also come out with a Tariff Order for non-Cas areas whereby not only the price freeze, which was already in operation, has been continued, but now even the ceiling in respect of cable rates have also been provided at the retail level.

    In addition, Trai has also stipulated the provision of a la carte channels to MSO/Broadcasters in non-Cas areas. The order has created a lot of hulchul in the industry.

    Cross media ownership issue and restriction in holding shares within electronic media and distribution sector may act as an impediment to the overall growth of the sector
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    No previous order/Regulation of Trai had generated as much heat and controversy as the present Tariff order for non-Cas areas. While the MSO and cable operators have welcomed it, the broadcasters on the other hand have severely criticised it, as in their view their commercial interest have not been adequately taken care of by Trai. The broadcasters are arguing that the present tariff order would benefit only one segment – the MSOs as no a la-carte choice can be provided to consumers in non-addressable analog environment because of technological impediments. Their grievance is that the Regulator has not addressed the problem of “under-declaration”. The matter is currently sub judice in the TDSAT.

    The Trai is in the process of issuing its recommendation to the government on IPTV and Mobile TV which would give further impetus to the proposed digitisation.

    The Cable and Satellite Television sector is the only sector where both Service Tax and Entertainment Tax are levied at present which amounts to double taxation. It may be mentioned that levy of both service tax and entertainment tax ultimately make the services costlier for the consumers. It is pertinent to point out that when a movie/ film is shown in a cinema, only entertainment tax is levied and no service tax is charged for screening the movie in a cinema theatre.

    Both DTH services and cable services are at present reeling under the heavy burden of multiple taxation and levies (such as license fee, service tax, entertainment tax, VAT on customer premises equipment which cumulatively add up to as high as 56 per cent) which are acting as an impediment to the growth and development of these services. Such a high multiple taxation and other levies vis-?-vis other sectors has resulted in these services becoming costlier and unaffordable for the masses.

    Accordingly, to ensure proper growth and development of this sector, the multiple levies/ taxation structure needs to be rationalised.

    Similarly, the customs duty structure on STBs and other equipments which are quite crucial for digitization also needs rationalisation in line with IT and Telecom sectors.

    It is imperative that to promote the growth of digital platforms, duty structure/concession applicable to IT and Telecom sector be extended to the broadcasting industry to provide a level playing field
    _____****_____

    All in all, year 2007 has been excellent for the Broadcast, DTH and Cable sector, and would be remembered as the year in which the solid foundations have been laid for digitisation and to create an environment enabling the broadcasting and distribution sector to takeoff and move towards the path of growth and development at an accelerated pace.

    In the present era of convergence the distinction between Broadcasting, Telecommunication and Information Technology is disappearing very fast. It is therefore imperative that in order to promote the growth of digital platforms, duty structure/concession applicable to IT and Telecom sector be extended to the broadcasting industry and it is treated as part of telecom infrastructure to provide a level playing field.

    The need of the hour is to create the same kind of conducive environment by the government by creating level playing field and granting fiscal incentives and concessions to the sector as has been done for the telecom sector and this sector would also register phenomenal growth in coming years.

  • ‘Rolling out of Cas has been the most significant development’

    ‘Rolling out of Cas has been the most significant development’

    The Olympic motto `Citius Altius Fortius’ a Latin phrase when translated means Faster-Higher-Stronger. We see strong parallels between the motto and the Indian Entertainment & Media (IEM) Industry. India is among world’s largest media consuming and content creating markets. Paradoxically, IEM is just 0.7 per cent ($10 bn) of the global $1.4 trillion industry. Till now, poor policies, fragmented markets, low investments and leakages have kept the moolah remarkably elusive. However, with sweeping changes in distribution, convergence and integration of models, we see IEM growing to $21 billion by 2010. We are bullish.”

    The above mentioned observations of SSKI research aptly sums up the present upbeat scenario on the television and distribution sector in India. 2007 has been full of various significant developments in the television industry, which have laid the foundation for technological convergence, digitisation and addressability, thus ushering a new era in the sector which would revolutionalise the television viewing experience in the ensuing years.

    The most significant and landmark development of the year has been the successful implementation of Conditional Access System (Cas) in notified areas of Delhi, Mumbai and Kolkata. This is being regarded as a big leap towards migration from analogue regime to digital regime. The regulatory framework is acting as a catalyst in the process of digitization. Trai has already recommended to the government for extension of Cas in remaining areas of these three Metros.

    Trai has also submitted to the government a report of the Group on digitization for introduction of voluntary Cas in 55 more cities in a well defined time frame. It is now up to the information & broadcasting ministry, to trigger off the said process by laying down a clear cut road map.

    Prior to 2007 the digitisation rollout in cable was virtually negligible. However, now we expect it to be happening at an accelerated pace. It is estimated that by 2010, the total C&S homes are likely to increase to 90 million from present level of 68 million. It is expected that out of those homes, 37 million would be digitised.

    In October 2007, Trai had also sent its recommendations to the I&B ministry on the policy framework for licensing and issues pertaining to headend-in-the-sky (HITS), which too is a digital distribution platform. The ministry is examining them and once a final decision is taken on these recommendations, it is expected that the digitization in the cable segment will take off at a faster pace as HITS has potential of digitising the entire country within a short span of time.

    In addition to various benefits of digitization such as capacity augmentation and provision of Value Added Services (VAS) to consumers, digitisation also results in bringing transparency in the cable sector, which not only leads to better tax compliance and realisation of due taxes by revenue authorities, but also ensure equitable distribution of revenue across the value chain.

    The government is the biggest beneficiary of the shift from analogue to digital cable, as digitisation releases significant spectrum. The spectrum can be utilised for other services like telecommunications, defence, emergency, interactive platform and value added services. This is possibly what is driving the government to take the steps necessary for the evolution of digitisation.

    For instance, in Germany, the government subsidised Set Top Boxes for the low income group, whereas in Ireland, the government launched a company (Digico) to introduce digital terrestrial services.

    Digitisation in the cable segment will take off at a faster pace as HITS has potential of digitising the entire country within a short span of time
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    Similarly in DTH distribution, the market is going to witness fierce competition amongst five to six players. In addition to the existing DTH operators DD Direct, Dish TV and Tata Sky, new entrants Bharti, Reliance, Sun TV and Videocon are also expected to launch their services shortly. It is expected that by 2010 the DTH segment would also have about 16 million digital subscribers.

    Similarly, IPTV and Mobile TV both emerging digital technologies are also expected to register an impressive growth by 2010.

    The year 2007 also witnessed lot of activities and developments on the content front. Though already about 270 channels are existing yet, unfazed by the large number of existing channels, several new channels of different genres were launched during the year.

    However, on account of bandwidth constraints on analogue network, the new channels are required to spend heavily on carriage fee in order to ensure their placement on the visible band in the cable network. The existing channels also witnessed intense competition and the entertainment/current affair channels were mainly dominated by “reality shows”.

  • ‘Consumer annoyance with intrusion in their space will take a new turn’

    ‘Consumer annoyance with intrusion in their space will take a new turn’

    Spatial Access Solutions managing partner Meenakshi Madhvani, while reviewing the predictions she made last year as to what the critical drivers in the television and media space would be, comes away pretty satisfied, and does some more crystal ball gazing…

     

    If there’s anything more challenging than predicting the media scene in India, it’s reviewing them a year later. It does feel good though if you are more right than wrong on your own predictions. Here’s how the reality played out in 2006 and some more predictions for 2007.

     

    Technology and its impact

     

    As predicted, the impact of technology on communication in 2006 was rather limited. Consumer pull rather than organizational push continues to determine the rate of acceptance and dissemination of technology. 2007 will see the adoption of newer technology but again, this is likely to be at the very top of pyramid. CAS may be pushed through by legislation but 3G, TiVo and wi-fi zones still appear to be a while away. Value-added SMS services though are likely to thrive.

     

    Consumers’ annoyance with intrusion in their space will take a new turn. We don’t think consumers are convinced that a “Do Not Disturb” option keeps pesky telemarketers at bay. In 2007, consumers will hit back. Beware all marketers who think they can intrude on consumers’ privacy and get away with it!

     

    The television medium

     

    Last year we had predicted that the television media owners would look at sampling the product and then worry about revenue. The resultant of this would be longer gestation periods and fewer media players who will want to enter the space on a whim. True enough, 2006 has seen no significant launches as far as television is concerned.

     

    To a great extent, this is also impacted by the lack of differentiation in product offerings. We had thought Times Now had the potential to make a dent in the English news segment but it doesn’t seem to have done as well as its competitors. Sticking to the basics though has meant that a NDTV 24×7 continues to hold its own and a CNN-IBN has created a niche for itself.

     

    We had also mentioned that those who do come in will be serious players with deep pockets. Our prediction that Disney’s entry would make players like Hungama feel the heat couldn’t have been truer. Disney went on to acquire Hungama!

     

    In 2007, we see major players attempting to build adequate critical mass and then leveraging on it. This could either mean acquisition of existing channels or launch of new ones to fill gaps in their content offerings. NDTV and their proposed general entertainment channel is a case in point.

     

    This brings us to the point on media companies who sought public funds for consolidation and expansion. 2007 should see a lot more activity in each of these companies. While entities like NDTV and TV18 are seen to be active, some like Mid-Day appear overdue for a significant expansion.

     

    We had also predicted that television channels (especially the bigger ones) would not be able to hold on to their advertising rates. This too is turning out to be true. The reasons are not hard to find: lack of differentiation and consumers drifting towards more compelling (read niche) content. Already, we see the effective rates for some top rated Hindi soaps dip by as much as 30% over the last quarter. On the other hand, niche content channels have been able to hold on to or slightly better their effective rates.

     

    The internet

     

    Last year we had predicted that the internet is going to come into its own in 2006. That has failed to happen or at least failed to match our expectations. 2007 should be year for advertisers to fully wake up to the potential of the web and for web marketers to accelerate the process. Failure to do so may result in advertising monies getting diverted to the “new” medium on the block – FM radio.

     

    FM radio

     

    Last year we had mentioned that 2007 and not 2006 will be the year of the radio. Though a few stations have managed to go on air, 2007 will see the complete roll-out. We believe the sheer numbers of channels present and the pressure to deliver a differentiated product will see a few exciting programming formats being developed.

     

    A contentious issue on radio is research data or the lack of it. We see a TV like situation developing where there may be more than one “industry” data source. The only way to avoid multiplicity of research data is for major players to come together and push the agenda for the industry. This also means that the only available research data, the ILT, needs to expand its coverage to more areas to be relevant to the radio channels and advertisers.

     

    Print

     

    The growth of smaller towns into bigger metros will result in more action for newspapers. While this means higher readership, it also means higher advertising costs. Newspaper publishers’ insistences on maintaining a low cover price mean that they are almost entirely dependent on advertising revenues to sustain the venture. Subsidizing cover price only works when there is adequate advertising support. Unfortunately, not all editions may be advertising money spinners. To make newspaper publishing a viable venture, newspapers will have to find a way to rationalize their cover price.

     

    Interestingly, the magazine scenario in India has become more active than ever before. While newspapers seem to be reaching new lows as far as cover price is concerned, magazine publishers, specifically those specializing in niche content, are intent on making circulation revenue a viable source of income.

     

    2007 may be too soon to expect newspapers to rationalize cover price but do expect magazines to up their cover price and consolidate.

     

    While at one point, newspaper supplements almost dealt the death blow to magazines, over a longer time period, the tables may turn. One factor is the size of operations. The bigger a newspaper grows, the more difficult it becomes to cater to specific reader groups and the more expensive it becomes to an advertiser. The cost of creating a 16 page supplement is soon not going to be justified by the ad revenue it brings in!

     

    The other factors are the speed and depth of coverage. Here, newspapers will get caught between news channels and magazines. And accelerating that process once again will be the consumer who demands what he wants rather than remain pleased with what he gets. Isn’t it ironical that some newspapers actually have magazine inserts these days?

     

    Other predictions

     

    An unlikely fall-out of segmentation of media is that we are likely to see more working relationships between players who are not in direct competition to each other. There is even likely to be greater co-operation between direct competitors, like India Today and Outlook, to protect their turf (magazine advertising) and grow it. A similar trend may be observed in radio.

     

    With consumers now buying around the year, traditional advertising peak periods, like Diwali, may well be on the decline. This can have serious ramifications on budgeting exercises for advertisers as well as the media.

     

    A shake out on media research seems likely in 2007. aMap versus TAM and NRS versus IRS are the two big title fights.

     

    Media agencies will continue to face a tough time, all of their own making. Dwindling avenues of compensation, advertisers seeking better ROI, Greater acceptance of the need for media audits, more aggressive media houses and man-power problems will continue to plague Media Agencies.

     

    With specialists emerging for each degree of the much abused 360 degrees approach to marketing, one wonders what will happen to the traditional media planner. However, all the specialization does present a great scope for people who specialize in multi-tasking to hold all of these activities together. Maybe the much abused client servicing person will be back in the spotlight, for the right reasons this time around.

     

    By the way, this is another prediction. 2007 will see the resurgence of the Account Executive – he will now play the role of the aggregator! Smart agencies will fuel this need among advertisers and help advertisers manage the process. Smart Agencies have realized that if you cannot get your client to give you all his business, lock stock and barrel, you keep an eye on the outflows and monitor where the money is going. For this you need sharp servicing!

     

    Finally, 2007 is a year in which we hope issues plaguing the industry are not swept under the carpet but addressed. (We at Spatial Access will be doing our bit to add transparency to the Industry)

     

    The rot, as they say, may be deep rooted but we need to make a start somewhere. And 2007 just seems right for it.

  • ‘As an industry, we should support unregulated Cas’

    ‘As an industry, we should support unregulated Cas’

    SET Discovery president Anuj Gandhi offers his take on how the distribution scenario would shape up in 2007 in the wake of digital cable and direct-to-home (DTH) penetration.

     

    The year 2006 was when broadcasters consolidated their businesses and made money on the second bouquet. The incremental increase in revenues for distribution companies largely came from this.

     

    The combined growth in pay TV revenues was in the region of Rs 2.5-3 billion. This included the southern channels and later in the year Sun TV, the most popular channel in the region, also turned pay. Star One, which had problems in Mumbai and Kolkata, got established. We also made money from our second bouquet.

     

    Direct-to-home (DTH) also became a reality in the year. Though it took time, Star India and SET Discovery bouquets were available on DTH as rates became realistic.

     

    On the cable TV front, progress was made towards implementation of Cas (conditional access system). The Telecom Regulatory Authority of India (Trai) came out with more definite regulations and there was intervention from the various courts. Unlike 2003, Cas definitely is more structured and planned this time. It, however, remains to be seen in 2007 whether it turns out to be a success or not.

     

    The big story in 2007 would be DTHccccccccccccccccccccccccccccccccccccccccccccccccccc and digital cable. Pay broadcasters would expect to net Rs 3.5-4 billion from DTH and the bulk of it would be incremental without eating into cable TV.

     

    We should see deals being struck on all addressable platforms. Digital cable, voluntary Cas, Headend-In-The-Sky (HITS) should all become a reality and make economic sense to distribution companies like us. As an industry, we should support unregulated Cas. Things will take time to settle down till digital gets in mass volumes.

     

    The big problem area should be a la carte pricing, but I don’t see channels deciding to price themselves individually below Rs 5. We would also see bouquets emerging in the Cas areas. It won’t be easy for consumers to forget the channels that they were receiving for so long. Family packages, properly priced, should take off. Pricing and a lot of other things, though, will depend on volumes.

     

    Equations will change in carriage payouts to multi-system operators (MSOs). As ratings towns get added, carriage will move there. And these towns would not have a digital story. But I don’t see budgets of broadcasters towards carriage really jumping. What would happen is that they would be picking and choosing the places where they want better placement and carriage.

     

    IPTV will see trial runs in 2007 but the commercial launches should happen only a year after that. All in all, there will be lot of changes in the marketplace in 2007.

  • ‘Twenty20 injects new life into sports broadcast’

    The sports genre will be known for four key things in 2007. Firstly, the upheaval that happened regarding cricket. Second, a breakaway initiative by the Essel Group forced the BCCI to wake up from its deep slumber. Third, a new format emerged that rejuvenated the bat and ball game. Fourth, even if cricket goes down there is no other sport to replace it.

    As regards the first point, there was a huge build up for the World Cup in March. Everyone from broadcaster Sony to marketers, advertisers had a calypso tune on their lips. Pepsi, one of the ICC’s partners, even went Gold for the event. Two matches into the World Cup and things went into free fall. India was eliminated. Information available with Indiantelevision.com indicates that Sony lost at least Rs 800 million as a result of unsold inventory. The overall loss to the economy from the World Cup debacle is believed to have been in the region of Rs. 2.5 billion.

    However, a few months later things had come full circle. This was due to two things. India won the T20 World Cup. Additionally, Twenty20, which was initially looked upon with some scepticism, proved to be a perfect fit for today’s attention-challenged youth. As a format it has proved to be a win-win situation for all parties involved – TV channels, advertisers and viewers.

    In the ultimate analysis, India’s unexpected showing in the T20 World Cup in South Africa looks like having the kind of long term impact that India’s even more unexpected victory in the 1983 ODI World Cup did.

    The biggest reaper of the T20 windfall was of course ESPN Star Sports (ESS). The T-20 success also means that ESS will get more bang for its buck that had been anticipated when it won the ICC rights late last year with a $ 1.1 billion punt.

    That apart, there is the BCCI’s ‘officially sanctioned’ Indian Premiere League, which if it takes off in the manner that IPL chairman Lalit Modi is envisaging, could well be to cricket what the Uefa Champions League currently is to soccer.

    It is worth recalling here though that it was Subhash Chandra’s Essel Group that first bet on the Twenty20 format when in April it announced the launch of its breakaway Indian Cricket League (ICL). The stated aim of the ICL, behind which Essel put in an initial investment of $ 1 billion, was to unearth talent from India and also to raise the standards of domestic cricket.

    And despite the Indian cricket board’s best efforts to ensure that the ICL remained stillborn, the fact that the inaugural tournament was staged with moderate success highlights one point. Carping apart, ICL has clearly validated itself. Suffice to say that the ICL’s calendar of five events for 2008 speaks for itself as regards Chandra’s intent to stay the course.

    What the IPL and ICL will likely do is that just as Europe is where the world’s best soccer talent congregates, the same will happen in India vis-?-vis cricket.

    The BCCI’s response to Chandra may have in initially been borne out of its outrage at the ‘temerity’ of a private body’s to take it on, but the positive fallout was that it increased the pay packet of domestic cricketers to prevent further exodus. Additionally, when it does launch its IPL, it will go that extra mile to ensure that it’s a success for all those involved in it.

    The upcoming IPL in April is structured as a franchisee-based Twenty20 Series with top international players. The likes of Russell Crowe, Shah Rukh Khan and Vijay Mallya have bid to own a team.

    Lodestar Media CEO Shashi Sinha feels that there is room for both. Also there are clients who will get in as the risk factor is less. Numbers may not be too high but they will not shoot down as was the case with the World Cup. A loyal audience is what clients will pay for as long as the price is right. Even a sixes event will work as long as it is pushed at a national level.

    As far as the rest of the sports broadcasters are concerned, 2008 will be key for Ten Sports as a host of cricket rights it has including Pakistan and Sri Lanka come up for grabs. Whether its association with Zee affects its position with cricket boards remains to be seen. Still, WWE has ensured that the channel remains steady in terms of weekly reach.

  • ‘Welcome To The Click Society: The 2008 Mega Trends’

    ‘Welcome To The Click Society: The 2008 Mega Trends’

    We are simply not alone any longer, anywhere or anytime… not even in the most private rooms and quiet spaces that we so dearly cherish. All that beautiful décor and openness that we think is filled with fresh air is actually jam packed with zillions of invisible wireless messages, electronic signals, streaming videos and all kinds of pulses that are fast forwarding our cyber-society of today.

    The special eyewear that’s currently under rapid-development to enable a three-dimensional spectrum view of digital flow in thin air, as seen in The Matrix, where free-floating, streams of digital information will surround us and shock our thinking. These digital signals cover us like a thick blanket, watching and awaiting every single electronic interaction of ours, recording, updating and profiling our habits and patterns based on consumption.

     

    Deeply submerged in the cyber-ocean of information, there are two outcomes to this. Firstly, our existence as a hyper-consuming subject, the second is an interactive profiling system, built on super-sponge-technology that scans our present movements to predict our future ones, offering products and solutions which parallel the speed of our thinking. Sounds too sci-fi crazy, but in reality, it’s yesterday’s news.

     

    There’s more information about us out there this very second than we can imagine. After all, we’re living under amazing times, like a very fast game of ping-pong, constant action and reaction to just about everything we act upon is being championed.

    It’s so fast and so instant that it boggles the mind; any of your actionable pulses could go and come back around the globe in a split of a second. See? It just did. Technology has seriously flattened the earth and truly curved our daily lives; where cyber lifestyles have us spinning into yogurt while the clocks seem going double the speed. It’s hard to figure out with all the supposed ease of technology and open access where the time goes. Hours seem to be shrinking into minutes. Seconds? What seconds? The hamster style mobility of the daily grind is keeping most of us from revolting. Even matters of distance have disappeared; you forget where you were few hours ago, which block, which airport, which Starbuck’s which country? The increasingly digital state of today’s world has almost eliminated the dimension of time.

     

    This digital miniaturization has blossomed into an interactive-hyper-connected world of mobile technology that has taken over as the most powerful of all new mediums so far. In this setting, the entire world becomes the largest shopping mall, the customer becomes the most powerful prowler, in search of deals, a universe of product and services opens up and only those organization with commanding knowledge of global marketing response, cyber branding and cyber mobility are poised to make it in this curved space.

     

    Also in the mix, a soup of multiple technologies and multiple skills combined to adopt multiple messages and unified under a master plan. These future products will hunt us down at the right time and opportunity, coming into play at that critical second just before the purchase decision; striking like a moray eel when a little guppy gets closer. It’s now like walking into thin air where you see absolutely nothing but the cyber blanket of invisible pulses and wireless information closely wrap around you; hugging you having full access to knowledge about what credit cards you have in your pockets, your favorite magazines and your major purchases of the last year; all nicely alphabetically organized and manipulated to evaluate your taste, habits, preferences and even deep intentions.

    Your age, gender, habits and occupational profile are all digital blueprints to decode your identity, style and spending. The cyber cloud hovers all around you as you approach various shops and your PDA beeps to inform you about a great offer on that watch you wanted, or will alert your bank about a potential overdraft when you enter a diamond shop. Failing to signal when changing lanes now appears on the balance of your next car insurance policy No, this isn’t a movie script, its old news.

  • ‘Welcome To The Click Society: The 2008 Mega Trends’

    ‘Welcome To The Click Society: The 2008 Mega Trends’

    Outbound Noise & Inbound Specificity

    These zillions of day-to-day, small online interactions add up, collectively developing your consumption profiles. The system can easily determine when you and how many of your friends are planning a trip to Rio, with what budget, and what airline. This information is a goldmine to some in the travel business, while the same goes to hundreds of other various sectors. This highly qualified specificity has created a meltdown in the traditional world of advertising, which was historically based on creating wild outbound noise with bottomless budgets. A great thing century ago, but the online era is founded upon the specific pulse of inward consuming traffic.

    The total change of old-media-structure is upon us. The last century gave us print society, where the printed word was power, and when only the literate could benefit from information, the ad industry started with a bang. The selling of goods and branding for mass consumerism become the bridge to most of the global economies and the concepts to produce and sell, earn and spend created the modern civilization. The conveyor belts of the process were managed by the ad industry and the herds of consumers were managed by the creative dangling of carrots by ads…today and each and every single day, the global ad industry easily spends over a billion dollars creating various types of branding and selling messages.

    But now, most current online and cyber advertising techniques are meticulously precise, measurable and predictable. They have trimmed all the non essential extra creative AD luggage and mega budgets that allowed for the arrival of the MAD Men TV series produced by the same team behind The Sopranos, correctly portraying the ad-machine that once created public hysteria and great consumer demands, but now lingers upon extinction like a dinosaur. This global rejection of the traditional ad-game is all over us, affecting newspapers, TV and all other ad based mediums while a new trace-able, track-able, predictable, ROI model of one-to-one advertising sell-first-bill-later is getting a stronger hold.

    The challenges are on two fronts. Firstly, a continuously modified mass scale selling of goods and services using traditional models which have fared well in the past. The secondly, the urgent need of highly exuberant structures of specialized global service agencies, connecting customers on a one-to-one, per-need basis, using hyper-connected, cyber-marketing-processes. Both fronts are very serious and work towards creating a major shift. Ad shops have always excelled at the creativity component which separated them from the other related service sectors. They are once again required to come up with better ideas and solutions, as on the net, it now takes only seconds to copy, cut and paste the same recycled campaigns and their value being erased at cyber speed. The winners and losers will be determined based on speed to market response.

    The 2008 Meltdowns

    IBM’s current study ‘The END of advertising as we know it’ is a forceful document downloadable from their website. It clearly points how the old advertising models, crazy creativity that is now being replaced by highly organized pay-per-click formats, creating direct sales for clients on a sell-first, invoice-later basis. This creates a two fold meltdown, one in which those agencies which remain still locked down in old models and other is the traditional free media worldwide which so far heavily relied on the Ad revenue.

    The 2008 Boom

    Clicks and more clicks. Anything that generates a click and results in a cascade of events will boom. There will be special gadgets to special services, from special click-based programs to special offerings. A kind of new click-sound to the click-economy, supporting search engine-based marketing, where the emphasis will be placed on finding a match between a customers and immediate consumption issues is where advertising and marketing will park themselves. The middlemen or the layer of services will offer clear, ROI-based campaigns and will, at times, have a huge surprise windfall for their highly productive campaigns as extra bonuses. Though, at the same time the big drawback will be privacy, as there will be extraordinary amounts of information made available to target customers.

    The New Trends

    A new emergence of a global desire to aim and create a Five Star Standard businesses is almost upon us, just like a five star hotel, with services, quality and style, this desire to operate a business and offer services just like a five star standard hotel will reflect not only on the corporate brand and the product and services as goodwill ambassadors, but mainly in its hospitable services and 24-hour availability of staff to address those issues. The difference between a luxury home and a five star hotel is the hotel keeps an on-call staff, open switchboard, open kitchen the entire facility and the room service. This is how the corporations of the new era will have to function in order to earn the respect in a click based round the clock society.

    Asia is now beginning to offer 24-hour, fully-supported banking, buying and selling of properties, insurance, travel, and all kinds of hundreds of new services. Now, the customer demands and decides whenever, whatever and wherever the need is to be met. Only the players equipped to meet these spontaneous demands will have a chance. The creation of a fully supported, 24-7 operation that will never close and perform transactions instantly is the new future. You would like to own those special glasses to see that blanket of streaming data hugging you right now…wouldn’t you?

    (Naseem Javed, author Naming for Power and also Domain Wars, is recognised as a world authority on global name identities and domain issues. Javed founded ABC Namebank, a consultancy he established a quarter century ago, and conducts executive workshops on image and name identity issues. He can be contacted at njabc@njabc.com.)

    (The views expressed here are those of the author and indiantelevision.com need not necessarily subscribe to the same)

  • ‘Cricket needs to evolve’

    ‘Cricket needs to evolve’

    If there was one person who brought about the biggest change in sports broadcasting in India in 2006, it was Nimbus chairman Harish Thawani. He took the big gamble by acquiring India cricket rights for a whopping $612.8 million and became a broadcaster.

    Thawani holds forth on sports broadcasting in terms of the changing landscape, Asia emerging as a major player and the importance of multiplicity of platforms and technologies.

    Traditionally the sports media industry has had 3 major segments: full service sports management/marketing agencies (such as IMG, Sport Five, Nimbus Sport) that manage/market rights, sponsorship sales, stage/manage events, provide sponsor services, advise on and/or manage L & M programs, represent athletes etc (many agencies specialize in a sub-set of these); sports television companies that focus on host broadcast production and/or sports program production and syndication (such as Sunset + Vine, TWI, HBS, Nimbus Sport) and sports broadcasters (such as ESPN, Fox Sports, Sky Sports, NEO Sports).

    Two trends seem to be emerging in the sports media sector. On one hand there appears to consolidation taking place in both the agency and broadcast sector (more of that later) and on the other hand the lines are getting blurred between the roles with agencies or their parent companies such as Nimbus entering the broadcast sector (with its recently launched NEO Sports) and broadcasters such as ESS pitching for rights on a global basis and consequently winding up acting as rights agencies in countries where they don’t broadcast.

    Consequently the future may see new role definitions, new competitive stances and strange alliances emerging; and quite possibly competitors in one region being partners in another.

    Trends close to home

    The importance of Asia is growing. In football it is now the world’s second most valuable rights territory. In cricket it is by far the most valuable. Japan, Korea, China and the ASEAN are fuelling unprecedented growth in rights values for basketball, golf, motor sport, tennis, even baseball.

    Pan Asian broadcast services are under threat and I think in 3 years will become unviable, as the regional broadcasters gain ground. The rise of the regional broadcasters and/or platform owned sports channels (from Al Jazeera in the Middle East to NEO Sports in South Asia to Astro’s Super Sports in Malaysia, to PCCW in Hong Kong and Starhub’s Super Sports in Singapore) have encouraged rights holders to stop doing pan Asian deals and opt for country wise deals. The success of the recent EPL auctions on a country wise basis was an example, where ESS lost a substantial portion of the valuable territories to regional broadcasters including China, Singapore, Hong Kong, Thailand and several others.

    Multiplicity of platforms and technologies will fetch sports broadcasters in Asia higher share of subscriber revenues. Sports and movies drive pay TV! In the Middle East we have three DTH platforms and three cable companies vying for premium sports channels. In India we have two DTH platforms with two more to come and a very large cable industry, Malaysia’s long standing monopoly of Astro will diminish with Telecom Malaysia’s massive IPTV foray. Hong Kong has two cable systems. Every major country is developing multiple platforms.

    Perhaps in 2-3 years time, we might see a consortium of regional broadcasters emerge, forming a pan Asian footprint but retaining regional autonomy, using the benefits of consortium buying of rights, collective platform negotiation ability, exchange of best practices and technology; and who knows perhaps even cross holdings into an Asian superstructure.

    Global management is now happy to work in Asia thereby giving Asian sports broadcasters the ability to merge local skills into global best practices, and compete with the global broadcasters such as ESPN and Newscorp (Fox, Sky, Star)…for e.g. NEO Sports has a Scottish COO, an Australian head of acquisitions, a Polish technology consultant and an Indian CEO!

    Cricket : The challenges and opportunities

    Cricket needs to evolve. The economic dominance of Asia powered largely by India represents both an opportunity and a threat to the globalization of the sport. Opportunity because the funds now at the disposal of cricket allow it to invest in development across the world. Threat because if the Indian economy slows down or the sports broadcast industry further consolidates, the revenues of the sport will decline. Cricket must reduce its excessive dependency on India. But that is easier said than done.

    The sport is essentially a 10 country sport with only 4-5 countries providing revenues worth the mention. The structure of the sport needs to emulate football and we need to dismantle the class system wherein only 10 countries get to play Tests and regular ODIs. In football even India plays internationals despite being ranked below 125! Cricket needs to allow all ICC member countries to play internationals. With the emergence of shorter formats (which itself are the way to the future of the game), like 20/20, it is easier for weaker teams to win against stronger teams occasionally because all that it takes is for 1-2 batsmen to fire for an hour or so!! Such results fuel fan following and the sports grows in new countries.

    Lastly cricket needs to understand that its obsessive focus only on revenues (read highest bidder wins!) is perhaps an expensive trade off as the interests of the highest bidder are not necessarily aligned to that of the sport. E.g. broadcasters that win global rights are not necessarily equipped or even wanting to encourage free TV broadcasts or multiple platform broadcasts for their interests lie in exclusivity and the subscription revenues that come with it. Fortunately many cricket boards have begun to understand that and now prefer to engage sports agencies (albeit with a revenue MG) to manage their rights with the mandate to increase revenues but also increase reach, improve branding, procure better sponsorships, develop new markets and assist in development programs through coaching videos etc.

    India : Road ahead is clear

    With economic growth beating the 8 per cent per annum mark and the next 10 years (if not much more) quite clearly a boom phase, there’s seldom been a better time to invest in India. Broadcast industry revenues are growing at 17-19 per cent per annum, spending on leisure including sport by Indians is on the rise, and the advent of addressable systems particularly DTH bodes well for premium pay TV services such as sports and movies.

    India : Cricket domination continues

    Having said that even the world’s largest markets don’t support more than 2-3 pay TV sports companies, which meant that my prediction of some months back that from a 6 player market we will see a 3 player market by 2007 has come true even before 2006 is out. DD and Sony are at least for the moment quite clearly out of the cricket rights acquisition market. Zee has taken control of Ten, so its essentially 3 companies now in sports broadcasting each with 2 channels (Neo Sports and Neo Sports Plus, ESPN and Star Sports, Zee Sports and Ten Sports); which should allow all three to operate profitably and given the amazing range of sports product available would give all three enough options to program their channels, except for one catch. The cricket catch.

    In a single sport country, this means that Neo Sports with its powerful cricket assets over the next five years, the depth of sports expertise of Nimbus behind it and powered by Star India’s distribution leadership will have a smooth side. As will ESS with its long standing experience, market franchise and reasonable cricket assets now strengthened by the ICC package. The challenge for ESS will be that in 2007 some if not all of their previous cricket assets start expiring and that means an uncertain path ahead. If renewals are hard to come by, they will have to wait for 2011 when the next World Cup is staged to make a strong come back.

    India: Domestic sport

    I had said in early 2006 that this would be the year of domestic sport in India. Hopefully the numbers bear me out. BCCI commenced 72 days a year of domestic cricket coverage and extensive re-branding and re-formatting. Even with the start-up phase distribution of NEO Sports it rocketed to the No 1 sports channel position in the TAM data in its first week itself with the broadcast of the domestic Challenger Series, with peak TVRs of 9.2 in one match! The Duleep Trophy final achieved peak TVRs of 2.7 on a weekday despite it being a 5 day match format! Zee Sports broadcast of Indian domestic football has also shown consistent results. I think by mid 2007 the ratings of domestic cricket will start rivaling Test match TVRs consistently and weekend One Day matches in the domestic Super League could be the killer app for NEO Sports!

    India: Other Sports

    Hockey is dead. It’s now official. It received a quiet and indecent burial at the recent Asian Games where India did not make it to the semis and no one shed tears.Tennis, golf and motor sport plough on their elitist path into Indian homes that would scarcely know the difference between a birdie and a break-point. I can hear howls of protest from the same elitist benches and to them I would say walk down (as I have) the streets of Jalgaon, Coimbatore, Ajmer or even Hyderabad and ask what a birdie is. The range of cute or crass answers might surprise you.

    That leaves football and to me the dark horse badminton as the 2 sports that India can and I think will develop a TV loyalty to. Football because it has a 3-4 state base, and the western and southern metros are beginning to take up to it (on TV I mean) and also quite simply because it is the true world game. Which is why at NEO Sports it already broadcasts live the Bundesliga and the Italian Serie A.

    And Badminton because it is India’s largest participation sport after cricket. It is extensively played in India and easily understood. It has never been adequately programmed on sports channels and not enough has been done to market it. NEO Sports plans to change both of that starting early 2007.

    India: Sports entertainment

    When Nimbus Sport did the Extraaa Innings production for Sony during the 2003 Cricket World Cup, only Nimbus Sport and Sony believed that merging sport with entertainment will lead to a serious opportunity to build a viewer franchise. It made the purists cringe (and rightfully so) but it raked in the TRPs and the revenues.

    Some months back I had announced that we see sports entertainment as the big hole in the market and NEO Sports Plus will launch a slew of sports entertainment shows by 1st quarter 2007. ESS was quick to follow with its own announcement and the good news is that they’ve already started 2 shows, both of which are showing very promising ratings.

    I think NEO Sports Plus will do 70+ GRPs a week by mid 2007 off the back of sports entertainment and its focus on football and badminton.

    Regulatory

    So now TV is in the PDS, controlled prices et al (sorry administered prices). Is it constitutional? Are world class premium channels to be sacrificed at the altar of populism? These and many other questions will get answered in the coming months. Personally I believe that price caps will not go for at least 6 months, but in the interim a multi tier price cap regime may emerge, with Rs 5 as cap for most channels, Rs 10 as cap for GE and movie channels and Rs 20 for sports channels.

    On anti-siphoning the Supreme Court of India has ruled in the Ten Sports case. Many believe that in India where cable is cheap and DTH is also cheap and covers all cable dark areas, there is no grounds for anti-siphoning regulations. Moreover cable reaches nearly 65 per cent of all TV homes now.

    But if anti-siphoning laws do get enacted, they need to consider some rather serious issues:

    1. Is DD a terrestrial broadcaster or cable/DTH? ODI matches can’t be shared with DD under the guise of it being a public free TV terrestrial broadcaster, and then DD merrily supplies the signal to cable and DTH killing the pay TV business!

    2. A use or lose policy with strict timelines and license fee rationale will need to be adhered to by DD as it is in many countries where antis-siphoning rules are in force.

    3. DD must encrypt its signals to their transmission towers. No where in the world does a free TV broadcaster send unencrypted signals via satellite.

    4. If the anti-siphoning rules are truly meant to for public service, DD must refrain from commercial exploitation of the feed and agree to carry the rights holders feed with commercials. And DD must not decline other sports the right to be broadcast on DD National, when events of global stature and/or Indian interest are being staged.

  • ‘Era of subscription rather than advertising supported media content is approaching us fairly quickly’

    ‘Era of subscription rather than advertising supported media content is approaching us fairly quickly’

    Lintas Media Services director Lynn de Souza says the year has been good for business. But she has a word of caution: there is just too much of ads going around for viewers to stomach.

    Business wise, 2006 has been a good year for advertising with both value (up 19 per cent) and volume increases. The total number of spots aired on television has shot up by 35 per cent from 10.3 million in 2005 to 13.9 million this year. For the month of September alone there was a 51 per cent increase. Plus, there was more branded content on all media including cinema than ever before.

     

    However, was this also good for the lay consumer, the housewife in Amritsar, the executive in Bandra, and the schoolboy in Chhatisgarh?

     

    Our lives have been swept up by the media. A good one third of the average Indian’s waking hours is spent with the mass media in some form or other – all through the day. Our lifestyles, values and opinions are being shaped by what we see and hear on the mass media as never before. 2006 gave birth or renewed life to many news and children’s tv channels, global magazine titles, regional language editions of newspapers, FM radio stations. So far all of these, without exception, are advertiser supported.

     

    It has therefore become virtually impossible for the average consumer to find a free moment in space or time where he or she is not accosted by advertising – on the streets, in malls, in airplanes, on the cellphone, in coffee shops, hotels and health clubs, while surfing the internet – besides the expected fare on tv, radio, newspapers and magazines.

     

    It should come as no surprise to us therefore that he or she has begun to get rather annoyed. Our latest estimate of active ad avoidance in this country has crossed 70 per cent for every medium, among heavy upmarket media consumers. Passive ad avoidance is not far behind. Avoidance of advertising among the rural rich is even higher. I therefore doff my hat at all of us who persist with our careers in advertising. This must be the only profession in the world in which the eventual consumer does his or her best to ignore and avoid and turn away from what we have to say.

     

    Intellect, our research and technology unit, recently released ‘Engross’, a survey conducted last month among over 2000 upmarket Indians to measure ad avoidance, ad perception and media engagement. Since we expected to find high ad avoidance levels, even on the more personalized media like radio and internet, we further probed on the reasons, our suspicion being that perhaps consumers didn’t like advertising at all. Indeed, the feedback was exactly the opposite. An overwhelmingly high cross section of consumers enjoy and appreciate advertising, and find it informative and helpful.

     

    So why do they avoid something they like? Simply because there is just too much of it going around to stomach. The same ad over and over again. Too many ad breaks. Ads inside content. Ads on covers. For the smart consumer, it’s really getting to be a bad mad ad world.

     

    There is a lesson in this for both media owners and advertisers. The day is not far off when these consumers will pay extra for ad free content. The era of subscription rather than advertising supported media content is approaching us fairly quickly. As advertisers we have unfortunately been caught up in the whirlwind of downward spiralling media rates, and have helped compound the problem of over advertising. Every time we have insisted on a lower unit rate we have been given bonus time and space by the media owners, thus contributing to the overload. We have together written up a volume over value charter, and the consumer is now clearly saying to us, “I don’t like this. I don’t like being taken for granted.”

     

    I hope we will all listen to this voice in 2007. Engross gave us another important learning – for years, content has been informative and advertising has been entertaining. Now however, the consumer finds content, even on the so called information media, highly engaging and entertaining, and considers good advertising to be informative. We would therefore be quite foolish to demean the value of advertising in his or her mind through poorly judged placements.

     

    To 2007, may our business continue to grow, and may our customers enjoy it too.