The worst of the economy is now hopefully behind us: Vikram Chandra
Q3 & Q4 are much better quarters for the media business in general. Going forward, we expect the benefits of digitisation to come in, plus the 2014 polls will also give us a boost, says the Group CEO of NDTV
NDTV reported a turnaround in operations, from negative to positive operating profits (EBITDA), garnering EBITDA of Rs 1.5 crore in Q2 FY14, as against operating loss of Rs 19 crore for the corresponding quarter in the previous fiscal. Consolidated income grew by 19 per cent y-o-y, to Rs 128 crore in Q2 FY14, as compared to Rs 108 crore during the same quarter last year.
In the coming weeks NDTV sees the benefits from digitisation kicking in, giving a further boost to the broadcasting industry.
In conversation with exchange4media, Vikram Chandra, Group CEO, NDTV speaks about the ground realities of the digitisation process, turnaround of the economy in the coming days, expectations from BARC and more...
What are the key focus areas for NDTV in the coming days?
We are focusing a lot on online media, particularly convergence, which is a major thrust area. Our investments and focus on online is slowly beginning to pay dividends. That part of the business is growing very nicely and our product is well received, we are in a position of considerable dominance there. It’s not necessarily true that old media houses like us are not going to do best in the digital world. We see the internet era as a major opportunity and not a threat. Besides the focus on digital media, re-launching of NDTV Profit is also on the cards.
You had earlier said that with digitisation, we are going to see subscription revenues going up and carriage fees going down. Are you witnessing this change?
Digitisation is underway and is supposed to be a game changer for everyone, however, the speed at which the benefits were supposed to have accrued to broadcasters is not really there so far. We have given to understand that carriage fees would drop by 70-80 per cent, but that hasn’t happened yet, no doubt carriage fees have gone down, but not at the rate that we had hoped for. As far as subscriptions are concerned, broadcasters are still struggling with the MSOs and the flow of subscription revenues has been slow.
Regarding the regulation on advertising time, our entire thought process is very clear on that. We have always said that we as broadcasters do agree that advertising beyond a certain extent is not good, but the business model needs to change. Once the carriage fees come down and subscription revenues increase, there will be less reliance on advertising and everything will be in the right track. Right now carriage fees are obnoxiously high, while subscriptions haven’t started to move up, how are we going to survive?
The Rupee depreciation and the debilitating economic situation have rattled the confidence of corporate in India, including the big players in advertising, media and marketing. How much has it impacted in the media industry?
It’s obviously clearly impacting the media industry. Q1 and Q2 are not particularly good quarters for the media industry, and this year it was worse as advertisers were cautious. The big campaigns that we were hoping for have not happened yet. The first six months of this year were very sluggish from an advertising point of view. However, we are hopeful that things are going to pick up.
Can we expect to see a turnaround anytime soon?
Yes, Q3 and Q4 are much better quarters for the media business in general. We also feel that the worst is over now from the point of view of the economy, and going forward, the benefits of digitisation will kick in. The worst of the economy is now hopefully behind us, and with the 2014 elections, the next few quarters should be much better.
How do you see NDTV’s performance in Q2 FY14?
We have seen a transformation from Rs 20 crore last year to break even this year, which is good. The Hindi market has been very good for the last 2-3 months. Total revenues for Hindi news were up 54 per cent y-o-y.
What are your expectations from BARC?
We have been saying it from day one that this industry needs a proper measurement system. The issues that broadcasters are facing with the present measuring system are well documented. The minute we get a better and more professional system, it will be step in the right direction.
The news about the shutdown of NDTV Good Times has been doing the rounds for a long time now. What are your plans in this regard?
There is no question of shutting down NDTV Good Times, these are all rumours. In fact, we are in discussions to give a boost to the channel. People also spoke similarly about NDTV Profit, but the channel’s re-launch is part of our business plans.
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