Big, ever bigger business
In one of the largest media markets worldwide, growth trumps regulation
The Indian Media industry is growing faster than the country’s economy as a whole and has grown exponentially ever since the economic liberalisation of 1990s. As per the figures released by Federation of Indian Chambers of Commerce & Industry (FICCI) for 2018, the Indian Media recorded a cumulative growth of 13% in 2017 to reach USD 22.54 Billion (INR 1.50 trillion) and it expects the sector to cross a volume of USD 30.06 Billion (INR 2 trillion) by 2020 at a Compounded Annual Growth Rate (CAGR) of 11.6%, faster than the country’s GDP growth.
But then this growth has also come with its own set of issues and questions. Media, unlike in the past, has branched out more as an industry than a watchdog or nation’s conscience keeper. “We are not in the newspaper business, we are in the advertising business” said Vineet Jain, the managing director of Bennett Coleman and Company, in an interview to New Yorker. It is an investment driven industry now, a corporate entity where balance sheets carry more weight than an investigative or an editorial report. There has been a gradual and general corporatisation of the media sector in the country over about the last 30 years ever since the country’s economy opened up with the first cycle of economic liberalisation.
During the same period Indian media went through a wave of changes. The Editor lost its control over the pages and became exceedingly subservient to the owner or the CEO. Corporate Managers and Marketing Managers became more powerful than Bureau Chiefs and Correspondents. Media was no more a proverbial fourth estate but a profit driven sector like any other industry. Arguably, one cannot understand this whole process of corporatisation of Indian Media without looking into the ownership issues of the country’s media and the global scenario.
Media Ownership – The Shrinking Base
The media in the country has expanded over the years but its ownership however remained concentrated in the hands of the few. Even as the number of media outlets has multiplied, the number of proprietors remained low or even decreased resulting in concentration of media ownership, though with increased circulation, reach and ad revenue.
Already the First Press Commission of 1954 voiced concern over ownership concentration in the Indian media and in 1982 the Second Press Commission advocated public takeover of the top eight newspaper establishments in the country to break up monopolistic structures.
The trend of ownership concentration in media is, however, global. Just four companies-Comcast, Walt Disney, 21st Century Fox/NewsCorp and Time Warner Holdings, at present, supply about 90% of world’s media content. Ownership of the media matters in public opinion, to know what line to take on an issue as it props up. During the Gulf War, all of the 150 newspapers of Rupert Murdoch’s NewsCorp supported the American invasion of Iraq. Shortly afterwards, Murdoch got the permission by the Federal Communication Commission (the media regulatory authority of the US) to run his operations in the United States, by bulldozing all domestic laws and norms.
Murdoch’s Star TV dominates in Asia. News Corporation’s television service for China, Phoenix TV, in which it has a 45 per cent stake, reached 45 million homes in 2000 and enjoyed an 80 per cent increase in advertising revenues (admittedly from a small base) over the previous year.
Rupert Murdoch has often been accused of using his media holdings to advance his political agenda. Like previously in US and Australia, thanks to his frequent interactions with the then British Prime Minister Tony Blair in the lead-up to the Gulf war, he came to be known in political circles as "the 24th member of the (Blair) Cabinet”.
In India, various reports and studies accessed by this author from 1953 to 1993 (during the forty years since the first Press Commission in the country was set up) reveal that five major newspaper chains in the country occupied about one third of the overall circulation hovering between 31 and 33%, representing a significant portion of country’s economy, that roughly makes around USD 7 Billion.
In the course of time these conglomerates got their infrastructure strengthened, expanded their base, enhanced penetration and revenues as well.
Ever since, the economic liberalisation of early 90s, India’s print media branched off into television and digital media well. With good availability of foreign capital, in terms of Foreign Direct Investment (FDI), particularly in television sector, this trend picked up pace. , Through this FDI route, USD 6.10 Billion (INR 406 Billion) had been pumped into the Indian media industry by March 2018.
Interestingly, an Indian union cabinet resolution of 1955 had barred any foreign investment in Indian media but with country’s economy opening to all sorts of foreign investments, media and entertainment sector was no exception any longer.
Corporate Media, emerging trends
This corporatisation of Indian Media has also thrown some interesting and discernible trends to analyse.
There is a growing tendency of cross media ownership where the same content property in one sector is promoted through another sector while audiences remain the same. Femina Miss India contest gets a highly visible audience through all print and electronic splits of The Times of India, Times Now and Zoom TV. So gets the hard copy of India Today or India Today Conclave through AajTak or TV Today television channels. In the end both splits have become money spinners for their respective organisations in terms of ad revenues. The same content, different channels, common infrastructure but with multiplied impact!
Some 30 years ago, 55-77% of the total revenue of an average media outlet would come from its readers directly through subscriptions or copy sales; today it is the advertisers who sustain the media. From a supplementary component (25-30%) few decades ago to that of supportive component (60-75%) at present, the share of advertising on the balance sheet has gone through an upswing all these years. In case of television channels it has been up to 70-80% by now. This is to the extent of determining priorities and preoccupations in terms of the content in a media outlet. In case of some big media houses, advertising comprises 60% of the total revenue of the group
Once market forces have a say, definitely they try to influence the content. Long back, when Samir Jain took over The Times of India, he got it written on the mast of the paper: Made in…(name of the city). When asked he said his newspaper is no more different from any other product, to be sold. That is the change Indian media has undergone. Today advertisers book the front page of a paper and news gets shifted to third page. That is the influence.
That illustrates the growth of advertising industry in India.
Over the years there has been a trend towards local media content as well. There are about 7-8 states in the country where monopoly of a single media house is on the rise. It means that more than 50 per cent of the viewership, readership and circulation in these states belong to the same group. Likewise, in states like Kerala, Gujarat and Rajasthan two dailies have been dominating the media scene, with a significant share in both circulation and readership, Malayala Manorama and Mathrubhumi in Kerala, Gujarat Samachar and Sandesh in Gujarat, Rajasthan Patrika and Dainik Bhaskar in Rajasthan.
A significant feature of the country’s corporate media is that the funding pattern or sources of many television channels remains unanswered or speculative. Some periodic reports suggest that a considerable chunk of money from the real estate sector has gone into the launch of many television channels. How much of this can be verified remains to be seen. But yes, channels and papers affiliated with political parties or thoughts have come up. Examples include Kalaignar TV in Tamil Nadu (DMK’s news mouthpiece), Sun TV (Marans of Tamil Nadu), Aakash Bangla (CPI(M)’s Bengal unit), Sakaal Group (Abhijit Pawar, nephew of Sharad Pawar), Sakshi TV (Jagan Mohan Reddy in Andhra Pradesh), Total TV (Om Prakash Chautala in Haryana) etc.
Even the giants in the industry have other businesses to look after besides hardcore news like the BCCL (The Times Group) in Radio, TV, internet, Magazines, Newspapers, education, films, events like Miss India; Living Media (India Today Group) in Radio, TV News, Magazines, Newspaper, internet, events like India Today Conclave; Essel Group (Zee TV) in TV, Cable, Film, Newspaper, radio, DTH, internet; STAR India in TV, film, internet, Newspaper, Cable, DTH etc.
No legal framework – Need for a Media Policy
This all happened in the absence of a legal and institutional framework.
There is no national media policy in the country and the Broadcast Bill, conceived some 15 years ago, was not passed since then. It was not even tabled in Parliament where it could have been debated or sent to a select committee which is the routine. The political cost or fall out of this corporatisation is that none among the two principal political parties in the country – BJP or Congress – took a stand on the subject and let the bill lapse even crossing 13 revisions and amendments.
In addition to the need for laws, there is also a dire need for a regulatory body in the country to implement legislation and in particular to look into the ownership and cross ownership issues, mergers and acquisitions and above all the monopoly over the audiences, as it has been advised by country’s top telecom regulatory authority – TRAI from time to time
In the UK, for example, the law is that newspaper mergers and transfers (where the total daily circulation of the paper in question is five hundred thousand or more) are subject to the consent of the Secretary of State for Trade and Industry after reference to the Competition Commission.
Encouraging experiments, need for a regulatory forum
While this may sound slightly disquieting, there have been some successful experiments during this period as well. Initiatives like cooperative ownership which gave birth to successful brands like The Wire and The Quint have lent a fresh air to the environment. Similarly, digital media, that offers a low cost platform to citizens to channelize their views and ideas, is another exciting thing to report during the same period.
But again, all of this is happening without any agreed policy, legal framework or regulatory authority to create and maintain healthy conditions in one of the largest media spaces worldwide.
Dr. Ahsanul Haq Chishti* contributed as a consulted specialist to the Media Ownership Monitor India by elaborating on one of the major findings - Corporate Ownership in the Media Sector of India. This article was written in coorporation with the MOM team. He also supported the project as a member of the advisory group.
*The author is Ph. D. in Mass Communication from Savitribhai Phule Pune University, Pune, India and author of India’s Changing Media Landscape-Cross Media Ownership, FDI & Broadcast Bill.
Consultation Paper on Media Onership Retrieved from TRAI on 28 May 2019
Citizens Jain Retrieved from The New Yorker on 28 May 2019
The new media moguls Retrieved from Outlook on 28 May 2019