Sony Entertainment Television (SET) has seen a fall of over 25 per cent in its advertising revenues for the first nine months of the current financial year with sales coming down to Rs 404 crores from Rs 300 crores for the corresponding nine months last year.
For 2000-01, SET, on the back of healthy growth in ad revenues that touched Rs 495 crore for the whole year, recorded a net profit. With falling viewership figures and STAR ruling the roost, this year it's a net loss so far.
According to the industry analysts, the subscription revenues are increasingly seen as the way ahead for channels. In the case of SET, subscription fees are bringing in Rs seven crores a month and the projected revenue for the year is put at Rs 60 crores. In the previous financial year, the subscription income was just Rs 22 crores.
SET's business plan sees subscription revenue growing to become 30 per cent of total income for the group in the next financial year from this year's projection of 20 per cent.
According to the channel sources, the mistake that has cost SET dear was that they encrypted the flagship Sony channel too late.
Advertising revenues have turned flat with STAR hogging, according to industry estimates, 50 per cent or around Rs 900 crores of the advertising pie.
The change in audience tastes —shying away from SET's old film-and-events driven programming and in favour of weepy 'relationship' soaps — has been a major factor in losing precious advertising revenue.
SET spent Rs 60 crores on film-buying last year. Both films and events are not paying anymore for SET and the company has now shelved expensive film and event buying.