Are TV production houses already facing the heat of NTO 2.0?

While some industry players say broadcasters have started cutting budgets for content, others shared that the emphasis is still on producing good content but an impact in the future can’t be ruled out

e4m by Sonam Saini
Published: Feb 5, 2020 8:21 AM  | 2 min read



Is NTO 2.0 already biting into the budgets of broadcasters? The one major criticism against the recently introduced amendments has been that the revenue of broadcasters who were just recovering from the New Tariff Order will be further hit, and according to people in the know the impact is already being felt, especially in terms of budgets allocated for producing content.

“The pressure on costs can already be seen,” said Abhishek Rege, CEO of Endemol Shine India.

“The impact of revenue on the broadcasters will see it affecting production costs down the line. We will all need to work together with the broadcasters as cost cutting is a reality that we will need to address," Rege added.

Many of the production houses have started facing the heat of cost cutting, a source informed exchange4media, adding that the broadcasters have already started to cut down 15-20% on the budget for producing content.

Another head of a popular production house said the broadcasters are now looking at ways to produce good quality content on a lower budget.

Ranjeet Thakur, Co-founder of Frames Production that produces shows like Dance Plus, Super Dancer, The Kapil Sharma Show, Dance India Dance, Dance Champions among others, said: “Cost cutting has already started. The broadcasters have already reduced their budgets for the couple of shows that we are producing.”

On the condition of anonymity, another producer shared, “If broadcasters are losing advertising revenue how are they going to make huge investments in content? Unless TRAI brings some changes in the regulation, this is going to impact the production cost. Shows like ‘The Kapil Sharma Show’, ‘Indian Idol’, ‘Super Dancer’ or any non-fiction show requires a huge investment as so many people work on each project - be it artists, technicians and writers. If cost cutting happens it is going to impact everything and eventually only consumers will suffer.”

However, the Head of a leading production company said broadcasters understand that content is king and hence they are particular about the shows they are putting their money into. “Only good content can grab eyeballs for broadcasters. Therefore, it's important for them to invest in the properties that will drive viewership. We haven’t seen any such cost cutting on the shows we are working on. But if things are not sorted out then we might as an industry face the challenges of cost cutting.”

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