In-depth: What's ailing revenue growth of Hindi TV news genre?

India’s Hindi TV news broadcast industry is facing a conundrum of sorts. Viewership has shot up by more than 100% in the last three years but ad rates haven’t moved up by more than 20%.

In the broadcast industry, the spike in viewership is reflected in the ad rates. However, it is opposite in the case of news TV where English channels, despite far less viewership, command much higher ad rates as compared to Hindi channels.

Experts believe that Hindi news channels are cannibalising each other by offering the lowest rates to gain clients, forcing others to follow the suit.

Ritu Dhawan

“A major reason is deficiency of unity among news channels. Practically most ‘low-yield clients’ know that they have to break one of the top 3 or 4 channels by showing volume and others will follow. Many channels tend to fall for volume instead of fair price for inventory,” said Ritu Dhawan, MD and CEO, India TV.

Varun Kohli

Varun Kohli, CEO, iTV Networks, India News and NewsX, said that the industry should come together for a policy on fixing the price.

“Today, there is strong demand by the advertisers for news genre shows, as news is been watched by both urban and rural viewers and we have this opportunity to capitalise it. I feel, it is high time that all the news broadcasters should come together at one platform,” he said.

Joy Chakraborthy

“Television overall is undervalued in India and the media has always been driven by the legacy factor,” said Joy Chakraborthy, who until recently was the CEO-Forbes India and President, Revenue, TV18.

Avinash Pandey

Avinash Pandey, COO, ABP News Network, also feels the same about the undervaluation of news. He said, “News is hugely undervalued and thus news channels have been struggling.”

Dhawan of India TV feels that the undervalued factor has more to do with sales and not deliveries.  “Lack of understanding of the business environment, including the understanding of numbers, ability to hold on to rates as an aptitude of the front-line sales are a few reasons to poor yields,” she said.

Currently, India’s Hindi news broadcasting has around 10 major players and all of them have around active clients on board as advertisers. The top five channels currently hold around 75% of the total genre revenues along with 60% of the viewership. During the major events such as elections, the viewership of Hindi news channels even surpasses the GECs.

The industry leaders feel that ad inventory is undervalued for various reasons including that the premium factor of the Hindi belt audience is yet to be comprehended by clients and media agencies which are skewed towards English news channels.

Ashish Sehgal

“News offers differentiated geo demographic profile — with a good skew towards upmarket audience and male decision makers,” said Ashish Sehgal, COO, Zee Unimedia and Chief Growth Officer (Advt. Revenue), Zeel.

“The biggest challenge is to move planners to shift the treatment of this genre as a frequency buy to an impact buy. We are constantly educating the advertisers about the premium-ness of this audience and the environment and mindset it offers,” he added.

The experts said that factors such as the use of wrong measurement matrix and not-so-smart ad-break strategy were also a hindrance for advertisers to realise the real value of Hindi news.

“The biggest roadblock in increasing yield is the current measurement matrix — CPRP. The TV universe of BARC viewers base is constantly increasing but the measurement matrix CPRP is constant, thus devaluing the ad inventory. The marketers and advertising agencies need to move out of Cost Per Rating Point (CPRP) to Cost Per Thousand (CPT) as a common media measurement matrix,” suggested ABP’s Pandey, adding that the ad-break strategy also needed to be reviewed to reduce the viewer attrition.

“The attrition rate is indeed very high and the remedies include higher rates and lesser inventory. The daily ad inventory is perishable and thus the rates should be based on the demand dynamics,” he said.

India TV’s Dhawan also admitted that longish ad breaks were contributing to high attrition along with low content pull.  

“The prescription is strong content pull coupled with smart break pattern and good commercials work invariably. We at India TV have reasonably been successful in reversing the viewership losses to an extent and thus advertisers get a better bang for the buck they spend with us,” she said.

The industry leaders suggested that the separate data being provided by BARC for ad breaks wasn’t doing any good either.

Vikas Khanchandani

“In a lot of developed countries, the viewership is measured only for programme and advertisers charged for those rating for the ad breaks. In India, we are obsessed for more granular data. We have today Program and Break ratings data separately,” said Vikas Khanchandani, CEO, Republic TV.

“We always keep the interest and sensitivities of our viewers in mind while devising our ad break and ad duration strategy. There have been umpteen instances wherein breaking news or critical news story is given priority over ad breaks,” said Sehgal.

Ad cap not a solution

Considering that shorter ad breaks may control attrition, would implementation of ‘ad cap’ be an effective solution?

To this, Dhawan said, “Not really. That would be a short-term approach. It’s about right combination.”

Explaining the rationale why ad cap is not a logical solution for the entire news genre, Khanchandani of Republic TV said, “TV broadcast in India is operating in a dynamic environment and independent news networks carry the burden of large distribution costs. A large number of news channels are free to air and the paid networks have limited subscription revenue. This makes most news businesses dependent on advertising revenue to sustain the business. With large operational costs and extremely competitive environment, ad cap is not a solution.”

“Ad cap can only be implemented if all the news channels get distribution money, in a scenario where we have free-to-air (FTA) channels, this solution is not possible,” added iTV Network’s Kohli.

The bias towards the English genre

English news TV claims better ad rates as there’s a wider belief that it reaches out to the most affluent classes and hence it deserves a premium pricing even if the viewership is one-tenth of a Hindi news channel.

“English has been commanding a higher premium because of buyers’ and clients' mindset,” India TV’s Dhawan said.

Sehgal believes that the media agencies and the broadcasters were both responsible for this bias. “The onus is on media agencies and us to make language a discerning variable for judging premium-ness as against psychographics / mindset, etc,” he said.

“English will always attract a higher premium and it should as the options are fewer to catch this viewer. While a Hindi viewer can come to English, it doesn’t happen vice versa,” said Chakraborthy.

Coming of age for Hindi news channels

Though Hindi news channels have faced hostility in rates for a long time, broadcasters are now gradually seeing things changing for good. “News advertising will scale in FY 18-19 and FY 19-20 on account of the high consumption and impact programming around elections,” said Khanchandani of Republic TV.

He said that ad rates were not always related to the availability of the inventory but dependent on quality of content and viewers’ profile.

Chakraborthy thinks that advertisers were willing to pay if they get the ROI and there has been a dramatic increase in ad rates of Hindi news channels in the last few quarters. “Viewership across national and regional news channels has grown. Therefore what one sees is that advertisers don’t shy away from paying as long as ROI is met. And we have seen that happening at least with our network,” he said.

The leading broadcasters think that advertisers are now realising that the number of English news channels are way too small compared to huge disposable incomes lying with the Hindi-speaking populace spread across HSMs.

The brands are now conscious of the fact that neither the numbers nor the response is in line with the type of spends they were doing on the English news genre.

Pandey of ABP said that things were gradually changing for the Hindi news genre as premium brands such as BMW and Mercedes were also appreciating the power of Hindi.

“Our endeavour is to make the advertisers pay for the valued and relevant audiences the channel is offering. We draw a constant comparison of the audience profile the language channels offer compared to not just English channels but across media as well,” he said.

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