Indrani Sen: Looking back at 2018

31 Dec,2018

By Indrani Sen

 

2018 has been an interesting and inspiring year for the Indian media industry. After struggling with the aftermath of demonetisation in 2016 and the GST in 2017, the industry saw a year without any external interruption and was able to regain the momentum of growth. We have to wait for another couple of months before we get the estimates for 2018 and the projections for the future from various industry sources, but market indicators show that traditional media industry in India has good reasons to welcome tonight 2019.

Indian traditional media has continued to remain resilient inspite of the growth of the digital media. Globally, 2018 would perhaps go down in history as the watershed year in advertising industry when the old guard bowed down to the new generation, best illustrated by the announcement made by  WPP in November 2018 to merge the traditional agency J Walter Thompson and digital agency Wunderman to form a new agency ‘Wunderman Thompson’. Abi Dan wrote an article in Frobes on the merger where he commented “While these are positioned as mergers of equals, they are essentially a takeover by the digital agencies of their older siblings.”

Against this global backdrop, traditional media continued to thrive in India in 2018 and the momentum is likely to last till we usher in the third decade of the new millennium in two year’s time. For Print, the oldest medium in the traditional media team, 2018 began on a high note with IRS 2017, released in January 2018, showing a growth of 9% in total newspaper readership from 2014 to 2017 and reiterating the reach and strength of the print media in the digital age. The continuous growth of the regional newspapers which sustained during 2018 indicates that Print in India is going to write its own history. The “fake news” controversy and the “#MeToo” movement made some scratches on the reputation of some publications, but did not have any lasting effect. On the other hand, digital media bore the brunt of the “fake news” more heavily and made readers turn to the printed words for assurance.

The various new ventures and deals in the Television sector announced in 2018 showed clearly that the medium is thriving for growth. The process of merger of Dish TV India of Essel Group with Videocon D2h was completed in 2018. Essel Group announced in November 2018 its plan to divest up to 50 per cent of its stake in ZEEL to ensure disruptive technological advancement and transformation of the company into a digitally equipped media tech firm. The decision is expected to be processed and implemented in 2019.

Reliance Jio announced in July 2018 Giga TV set-top boxes which will have the ability to use Internet to offer live TV and live interaction through Jio TV Call. This announcement was followed in August 2018 by the announcement of Jio Giga Fibre, an ultra-high speed fixed line broadband service for homes and enterprises. Jio also made substantially large primary and secondary investment in Den Networks and picked up majority stakes 51.3 per cent in Hathway Cable and Datacom Limited.

After winning the media rights of Indian Premium League in September 2017, Star TV managed to increase the overall viewership of IPL 2018 through successful implementation of their marketing strategy in national and regional markets.

E-Auction of DD Free Dish slots was postponed from 2018 to 2019, probably in view of the uncertainty around the implementation of the new tariff policy announced by TRAI. . The next E-Auction of DD Free Dish will play a significant role as all TV viewers will have to pay a fixed base rate for getting access to the free to air channels and then choose the pay channels as per the rate cards.

Early in 2018 we saw Star India & Star Viay challenging TRAI’s new guidelines related to the tariff order (issued in 2016) in Chennai court. After Chennai High Court ruled in favour of TRAI, Star India made an appeal in the Supreme Court, who also upheld the order of TRAI in October, 2018.  The year has ended amid a lot of confusion related to the implementation of the new tariff order forcing TRAI to extend the deadline by a month from end December 2018 to end January 2019.  Most of the large TV operators have announced their own package deals for subscribers, but the distributors are not offering the same as TRAI has not given any guideline related to such package deals and how the revenue of the same will be shared between the TV channels and the distributors. It remains to be seen if the consumer actually benefits from the new tariff orders or emerges as the looser, particularly in small towns and rural belts.

Radio, the older yet weaker sibling of the Broadcast media, managed to retain its share of business against the financial disruption caused by demonetisation and GST in 2016 and 2017. The same trend continued in 2018 when we saw the base of FM Radio expanding with many of the new radio stations sanctioned in the Phase III Auction going on air. FM radio stations have been actively integrating for some time their on-ground activations with digital content through innovations which has helped in their overall growth of revenue. 2018 was no exception to the same. While the growth of Radio Adex has remained moderate in 2018, the overall growth in revenues of the radio stations has probably seen a healthier growth riding on the rapidly growing digital and social media.

During 2018, OOH has recovered from the effects of demonetisation and GST but we did not see much growth in Digital OOH which was expected. Due to lack of a proper Adex system in outdoor medium, its revenue as well as growth has been getting under estimated over the years and 2018 has not seen any change in that condition.

According to the industry sources, the cinema advertising has seen a healthy growth in 2018 riding largely on in film advertising, particularly in regional cinema. Again, this growth may not get reflected in the overall calculations of advertising expenditure in 2018 which we will get to see in another couple of months.

As predicted, Indian digital media has grown in an exponential rate during 2018, in spite of the disturbance created by “fake news” etc. The growth has been helped by the increase in internet access through mobile internet and various forms of internet advertising.  Video Games and on line streaming of music and movies have continued to accelerate the growth. The international and homegrown OTT players have also helped in the overall process of digitization of media exposure in India.

To sum up, 2018 has been a fruitful year for media industry in India with lot of activities across different media. It is expected that the growth will not only continue but will accelerate during the first half of 2019 riding on the upcoming General Elections.

 

 

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