Exploring growth avenues is imperative for any industry to grow and sustain itself, especially when economic sentiments are still not very strong. To discuss the key milestones on the road to recovery for the Indian broadcasting industry, the Indian Television Distribution Networks Congress 2010, an exchange4media Group initiative, was held in Delhi on February 18.
The future is bright
Speaking at the first edition of the Indian TV Distribution Networks Congress, Sameer Manchanda, Chairman, DEN and Joint MD, IBN18 Broadcasting, delivered the first of the two keynote addresses. Starting on a positive note, Manchanda said that though a lot of people talked about the grim conditions that had been plaguing the industry, there was potential that was untapped. Supporting his statement with numbers, Manchanda juxtaposed the Indian industry with the growth that was seen in the US markets in the last decade.
According to him, the industry needed to see the larger picture, and if the goals were set, there would be ways to achieve them. Manchanda further said that he expected the advertising revenues for media to grow more than India’s GDP growth. Commenting on digitisation, he said, “Digitisation in India has given the consumer a taste of choice, quality and control, which is a good development. Digitisation is definitely going to grow. However, it is happening at a slow place in India.” Manchanda stressed that if a sunset timeline was set, it would give a clear mandate to the industry to embrace digitisation.
Speaking on the role of broadband in helping television’s case further, Manchanda said, “Television has a chance to become a significant place in homes through broadband. However, India has been failing at this front.” He urged for a push from cable operators, telcos and Wimax players, which would give a boost to the broadband market in India.
Commentin on the media companies, he said that the players who were working towards building a better distribution ecosystem would reap the benefits in future. “Therefore, every player in the media domain is trying to become a consolidated media house,” he concluded.
‘DTH needs to realise the potential’
Taking off from where Manchanda had left, Uday Shankar, CEO, Star India, commenced his address with some questions. One of the first questions that Shankar asked was why there was a perception that in the cable versus DTH battle, the latter was gaining. While accepting that DTH was the flavour of the season as investors loved it, consumers wanted its and broadcasters preferred it, Shankar rued the fact that both cable and digital had taken the pricing way to add subscribers. He stressed, “Healthy competition is needed between the two sections of the industry for the industry to grow. However, the pricing game that both DTH and cable have indulged in has been a monstrously suicidal path chosen by the stakeholders remarked.”
Shankar also spoke about the implications that the rate wars had had on the variety of content that was available on television today. “The revenues generating for television through advertising is not enough for investment in content or infrastructure to get people to spend more time on the medium,” he remarked, adding that today, content was made keeping in mind the lowest common denominator that cut across segments and that was happening because advertising was skewed towards the lowest common denominator.
Shankar stressed that subscription revenue was needed to support specialised content, and until such time, it was difficult for broadcasters to generate specialist content. He noted that for the ARPUs to go up, DTH players had to move beyond brand building. “DTH players have to offer differentiated content to its customers and the players have to go out and make a case for themselves,” he said, adding, “If the content is there, people are ready to pay for it and there is a clear differentiation.” Shankar concluded his address, saying that cable could not harness the potential to go local and it was high time DTH took note of the opportunity.
Government needs to push and support digitisation
Following the keynote addresses, Pradyuman Maheshwari, Group Chief Editor, exchange4media.com and impact, had a Q&A session with both Manchanda and Shankar. On being asked the way forward for the industry and how to be profitable, Manchanda replied that patience was the answer to the riddle. “Compelling content where the customer is ready to pay for the content is what is needed,” he added. Shankar responded to this by identifying two measures that needed to be taken. He said, “There is a need to correct the business model. Creating homogeneity of content will not help since the Indian market is so diversified.”
Touching upon the regulatory issues that the distribution business faces, Maheshwari asked the speakers about their wishlist for the Government. Shankar responded to this by saying that in India the case had been that industries had strived despite the regulator being there and the distribution saga was no different. Manchanda responded saying that the Government needed to unshackle the distribution industry. On the point of lobbying by the industry, Shankar maintained that the industry had not lobbied much and the reason for that was the lack of common vision amongst the industry stakeholders. Closing the session, Manchanda remarked, “It is too early for the industry to see consolidation taking place, while the need of the hour is for the Government to set a sunset date for digitisation and a uniform policy.”