Newspaper business challenges become more complex with the current inflationary environment, even though inflation dipped to 8.98 per cent for the week ended November 1. Effective cost management measures gained precedence at this session as media heads discussed ways to beat inflationary trends at the second INMA South Asia Conference being held in Mumbai on November 13-14.
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Starting the session, Ashok Rajgopal, Partner, Media and Entertainment Practice, Ernst & Young, made a presentation on various cost cutting measures. He pointed out, “The global newspaper industry is facing multiple pressures such as shrinking topline and declining circulation revenue as readers shift to new media. Publishers respond to these pressures by taking various measures on the revenue and cost fronts. The Indian newspaper industry is very sensitive to two specific factors – high reliance on advertisers and high newsprint cost. The question that arises here is can I offer my reader and advertiser using the same resources.”
“Over the next 12-18 months, media companies will need to evaluate the business they are present in, break down the financials and adopt a ‘zero-based approach’,” he added.
A panel discussion followed the presentation that saw the participation of Mohit Jain, Director (Business and Commercial), The Times of India; and Cyriac Mathew, COO, Mid-Day Infomedia Ltd. DD Purkayastha, Managing Director & CEO, ABP Pvt Ltd, was the moderator.
Purkayastha said, “Economic slowdown comes and goes, and though several media are being hammered, I believe this is the time to look back and find innovative solutions to tackle it. That is the only way we can survive.”
Stating what steps Mid-Day Infomedia is taking to overcome the current situation, Mathew said, “We prevent wastage of pages, we have cut down on some coloured pages, and have solved the problem of voltage fluctuations.”
According to Mohit Jain, “This financial turmoil, which was started in the US, has spread to other countries as well like a disease. There are challenges that are emerging for the newspaper industry. In the current situation, what is more important is how we do it and when we do it. Time is not important, but timing is.”
He further said, “We tend to overestimate the present and underestimate the future. Prices are important and we should always be cautious about the same.”