Political India: Engaging America

Forecast: All-out War in Mumbai

As the article from Asia Times Online suggests, there is a vicious print media war that has already begun on the western front, and it promises to erupt into full-fledged bloodshed. The casualties will be many, and as the author of the article says, one hopes that the bodies of innocent journalists, victims of journalistic 'bubble' economics, will not litter the field.

This article's focus, and indeed a genuinely crucial stake in this whole game is the share of the advertisement pie that each publication house can command. Throw in a sprinkling of foreign big media interest in the form of portfolio investments, and you can be sure that a lot of money is going to flow, nay cascade, across the terrain of the Fourth Estate.

It would be comforting to be able to say with confidence that at least the reader of newspapers is going to benefit immensely from this commercially-driven expansionary trend. However, even this is in doubt, precisely because of the changing 'culture' of most media houses. Let's be honest, it's hard to resist the pull of higher profits and dividends when it's all out there for the taking (savage market competitors notwithstanding). However, even if financial sustainability is an undeniably crucial bottom line, there is a strong case for assuming that the long term survival of most newspapers will depend on being able to give the reader something more than news reports (although when authentic and credible, these still have value)- a framework to understand news developments. This attribute then, takes newspapers back to their basics, and away from plunging cleavages on page 3.

Time for news media to re-think their survival strategies?

Asia Times Online Article: No stopping the press in India

After decades of stagnation, the print media business in Mumbai is getting a serious makeover. Along with monsoon downpours, a slew of Indian and foreign publications are showering down on India's financial capital and the country's richest media market, with English news daily behemoth Times of India facing a messy turf war that could make for a nice Bollywood potboiler.

In the shakeup, long-suffering media hacks are landing record salaries (reports abound of 100-300% hikes), mid-level editorial staff are getting out-of-turn promotions to fill the gaps left in the wake of busy headhunters, bullied advertisers are suddenly confronting unprecedented options, and Mumbai readers can hardly believe their luck.

Leading the feisty challenge to dethrone the Times of India (TOI) is Direct News and Analysis (DNA), a English-language daily launched as a joint venture between Zee, the largest Hindi satellite TV network, and Dainik Bhaskar, a leading Hindi daily that's part of the US$391 million Bhaskar Group. DNA, with a massive door-to-door marketing campaign (involving 1,500 young data collectors) plans a mid-July launch. Entering the market about the same time is the Hindustan Times, the New Delhi-based major, bringing its bitter turf war with TOI in Delhi to the enemy's den in Mumbai.

In a steamier sub-plot, the Times of India is in a running battle with Mid-Day, the highest-circulation tabloid in Mumbai. Mid-Day launched a morning edition to eat into TOI's plate and TOI has responded with a new tabloid, Mumbai Mirror, to give Mid-Day a knock. Agencyfaqs!, a media analyst, however, feels that Mumbai Mirror has flopped, serving a lesson in how hard it is for a newcomer to grab the Mumbai reader's attention.

The surging activity has not escaped overseas eyes. On Sunday, Tony O'Reilly, the chief executive of Independent News & Media (a leading international media and communications group), was quoted in the International Herald Tribune calling the Indian market "the new theater of strategic investment". The Indian government had allowed him to buy a 26% stake in a leading newspaper group, Jagran Prakashan, for $36 million. The same article quoted an investment banker as saying that the foreign stake in Indian media had climbed to $300 million in the last 18 months, with another $250 million expected soon.

The much-debated foreign direct investment (FDI) in the mostly family-owned Indian media has cracked open, with the Indian government allowing a 26% ceiling. In June 2004, Dow Jones partnered with Bennett & Coleman to publish the Asian Wall Street Journal; Pearson's Financial Times invested about $3 million for nearly 14% of Business Standard, India's second-biggest business newspaper; and Henderson Private Capital's Asia Fund, a private equity fund, recently pumped in $20 million for a stake in Hindustan Times.

Media stocks such as the software magazine business Cyber Media India and the South Indian newspaper giant Deccan Chronicle are currently making impressive inroads in the National Stock Exchange (NSE). In the recent bull-run in Indian bourses, Deccan Chronicle's share price shot up by 14%, encouraging more players to tap the markets for funds.

"A lot of changes are happening, and happening for the good," Amy Fernades, the new editor of Femina told Asia Times Online. Femina - India's oldest women's magazine in English, and originally part of the Times of India stable - was taken over by BBC in a 50-50 ownership arrangement with Bennett & Coleman, the owner of Femina, Times of India and Economic Times. The new company, World Wide News, operating from a swanky green-themed office in the Times of India building in uptown Mumbai, runs two other magazines apart from Femina. Fernandes got the job after DNA poached Femina's last editor, Sathya Saran. "We have 40% of the top editorial talent in Mumbai," crowed a senior corporate communications manager from Zee.

The plot thickened when Pradeep Guha joined DNA as the chief executive officer. Guha is the marketing whiz kid who turned the Times of India from a dowdy daily sneered at as the "Old Lady of Boribunder" to a racy, semi-tabloid daily that has come to be ruled by marketing bosses who tell editors what to print, besides flirting with the naughty side of media ethics (see Dirty laundry at the Times of India- recommended reading!). Guha was hired by DNA for a reportedly record sum by Subhash Chandra, owner of Zee, and is now hatching schemes to give his former employers a run for their money.

Advertising agency heads, cautiously watching and waiting, are happily witnessing the unfolding script. "We are definitely going to get better deals thanks to the fierce competition among Times of India, DNA and Hindustan Times," Abhijit Bannerjee, owner of Wavelength Communications, told Asia Times Online. A DNA sales team had visited him earlier in the day, promising a 40-page daily color edition with a 300,000 initial print run, about half the 600,000-plus print run of TOI. "TOI does not cut ad rates (a full-page black-and-white ad costs about $40,000), but they will have to give more add-ons. The most important development is that the Times of India monopoly is being broken."

Local senior media professionals wonder how much the new shake-up would result in quality journalism and increased readership. "Trainees have been suddenly inducted with fat salaries," pointed out Smruti Koppikar, award winning journalist and Mumbai bureau chief of the leading news weekly Outlook. "Also, unless readership increases the new dailies too will all be eating into the same pie."

Another critical factor in the new media war is how much TOI has dipped in popularity ratings. "Most of my friends want an alternative to TOI," said Ralph Pais, a media veteran for 30 years. "TOI seems to persist in thinking that showing women's cleavage will boost circulation." Invaders are banking on this apparent insult to local intelligence. Vir Sanghvi, editorial director of Hindustan Times, boomed to an interviewer: "Readers in India's most prosperous, cosmopolitan and modern city - and the city I grew up in - are tired of being taken for granted and treated like morons."

But other media pundits gloomily point to a dark side of this sudden burst of media activity. "I hope the media explosion does not go the way of the tragic dot-com boom," wrote Chandan Mitra, of the Pioneer, a New Delhi-based English daily that once entered Mumbai and beat a quick retreat. "I would hate to see hundreds of journalists rendered jobless, begging to get back their old jobs even at drastically reduced salaries." The next year or two will tell.

As a recent article (below) in the International Herald Tribune explains, the Independent Group of newspapers in the UK has acquired a 26% stake in the company publishing Dainik Jagran, India's largest national (Hindi) daily. This follows the recent announcement by the Government of India permitting foriegn investment by FIIs, including NRIs, in domestic media companies (albeit with the existing cap of 26%)- see blogpost.

Indian newspapers are likely to be duly concerned by this development, as it marks the entry of foreign market power into a sector where the creeping influence of commercial interests has been steadily eroding editorial values and quality journalism for almost a decade now. The latest evidence of this process is the Times of India offering even editorial space for a price, to the highest bidders.

What then, might a serious publishing house, such as The Hindu, do to stand up to this challenge? An initial reaction might be to consider opposing this move. The basis of such opposition would be the view that news publication ought to enjoy a 'privileged position' among all other sectors, given that the 'product' is about more than commercial interests; it is about upholding and increasing the strength of democratic institutions (see blogpost). However, this is unlikely to yield any results given that the liberalisation of all sectors of the Indian economy has been steady, like a march to a drumbeat. And given the observation above regarding ToI-induced 'commercial creep' (no pun intended) it was only a matter of time until this happened to the newspaper 'industry' as well. And in another sense, there is some validity to the claim that the government represents the people of India, and hence do its decisions represent the people's preferences (Democracy 101!).

Thus it may well be advisable for those news houses unwilling to yield to commercial crassness to find fellow newsmen and women in foreign lands of a similar dispostition and get into talks with them. A good candidate for The Hindu might be The Guardian in England, another stalwart that has refused to stand down in the face of murderous Murdoch. In a world where advertising profit margins are shrinking and the internet and other digital media are making many news providers redundant, the USP of the newspapers of tomorrow may anyway be to provide succinct yet interesting news analysis. In the path towards such a future, a strategy of cooperation with foreign news media that upholds the values of truth-telling, credibility and authenticity, justice and humaneness is perhaps the best The Hindu could ever find in these troubled times.

IHT Article: Media market lures foreign money

The Indian market is "the new theater of strategic investment," the chief executive of Independent News & Media, Tony O'Reilly, declared last month after the Indian government had approved his bid to buy a stake in one of the nation's leading newspaper groups.

His company, the owner of the British newspapers The Independent and Independent on Sunday and of The Belfast Telegraph, paid $34 million for a 26 percent stake in Jagran Prakashan, a Hindi-language daily publisher and television broadcaster.

O'Reilly's confidence is echoed in other foreign investment in the Indian media industry. The government's recent loosening of foreign investment rules in print and current affairs media has attracted a number of outsiders into India who are eager to capitalize on this growth.

"There has been a huge broadening in the market, both from strategic players and from private equity funds," said Anindya Roychowdhury, associate director of KPMG. "The economy is doing very well, and there is a lot of international excitement about the country. The feel-good factor is back in India."

Sunir Khetarpal at the Mumbai-based investment bank YesBank said that in the past 18 months, foreign interests had invested about $300 million in the Indian media industry, and he forecast a further $250 million in the near future.

"Things are looking brighter and brighter every month," he said. "Every announcement by the government in the last two years has been to deregulate the sector, making it more favorable to foreign investors."

In May, Reuters entered into an agreement with Bennett, Coleman & Co., publisher of The Times of India newspaper, taking a 26 percent stake in a planned English-language TV news channel, which is expected to start this year.

Since foreign investment of up to 26 percent was permitted in 2002, several big international players have come into the Indian newspaper market, attracted by the country's flourishing consumer spending, rising advertising revenue and the large potential readership among the one-billion strong population.

Last June, Pearson's Financial Times paid $3 million for almost 14 percent of Business Standard, the country's second-largest business daily newspaper. Dow Jones last year started its own partnership with Bennett, Coleman to print The Asian Wall Street Journal; and Henderson Private Capital's Asia Fund, a private equity fund, recently bought a $20 million stake in The Hindustan Times.

India's entertainment industry has never been subject to the same regulations as the print and news sectors, and big multinational companies like News Corp. have had a strong presence since the early 1990s. With soaring box office revenue, smaller foreign investors are racing now to buy into the growing multiplex theater business.

Every Sunday, The Hindu will feature tips and pointers concerning trends in housing

The Hindu will launch a weekly editorial supplement, Property Plus, from June 19. Each Sunday, it will feature tips and pointers concerning trends in the real estate market, housing, architecture, interior decoration, construction technology and materials and related areas. Key industry trends and events, topics of contemporary interest, elements to aid convenient lifestyles will be some of the focus areas.

Solutions to needs

Tips to improve living spaces, to impart charm, style and panache to homes and business spaces, to make the best out of limited spaces and find cost-effective and durable solutions to growing urban needs will be available in the supplement.

Regional development

Issues pertaining to regional development will be explored. The all-colour supplement is also expected to provide advertisers with a focussed forum to present their offerings in the sector. Industry sources have expressed the hope that it would turn out to be a unique weekend niche platform where reader attention could be exclusively engaged in a specialised marketing context and in a feel-good ambience in a relevant sub-regional territory.

Facsimile Editions of Foreign Dailies May Be Allowed

As recent news reports have confirmed (see Rediff.com, The Hindu and Sify.com) it would appear that the UPA government has permitted foreign daily newspapers to begin publishing facsimile editions in India. As the Information and Broadcasting Minister S. Jaipal Reddy mentioned at a stock-taking symposium for the central government's performance, such dailies would not be allowed access to Indian news content and advertisements. And he went to lengths to clarify that the existing foreign investment cap of 26 per cent in the print media and news channels would continue, and hence fears regarding the growth of FDI in this sector were unfounded. The real question is, does this step forward, even if marginal, not represent a move towards allowing a broader scope of influence for foreign dailies in Indian politics and soceity? And on a related issue, what is the implication of Mr Reddy's comment that, "Indian editions are not being permitted at the moment because of apprehensions that the Indian newspaper industry will not be able to withstand the competition"?

In answering these questions, it is first instructive to consider what exactly a facsimile edition is. The trussel.com online Book Collectors' Glossary defines it as "An exact reproduction of an original [newspaper] depicting the text and the paper's physical appearance". If indeed the Government of India permits foreign dailies to print exact copies of their international editions, then it is possible that there will be no major change influence that media barons such as Rupert Murdoch could wield in democratic politics in India. But the point is that there are no enforcement mechanisms in place to punish foreign dailies that gradually begin to include more content on Indian news and analysis (even if it is not sourced from within India). No mechanism, that is, apart from debarring facsimile editions of errant publishers abroad. But how likely is this to happen? After 15 years of liberalisation and structural reform, if one thing is certain, it's that reform has always been piecemeal. And while policy retractions are not uncommon, when they do occur, it is only because of the lobbying or other political power of those who stand to lose from the reform itself. In this case, it may well be a sitation of Murdoch versus Sonthalia or some public interest litigation type, in which case the state has a vested interest in undercutting the power of the domestic media that is often its most strident critic. This is one serious problem with the policy 'model' followed by the UPA government regarding foreign dailies' facsimile editions.

The second issue relates to the Indian political establishment's view that the only reason that foreign print media should be kept out of the domestic arena is that presently, domestic papers cannot "withstand the competition" (Reddy). This again refelcts a seriously flawed position on the issue, because at the end of the day, one of the most vital repositories of substantive democracy in India is the free press. Thus it is not a question of withstanding competition at all. Rather, it is an inviolable right of not just media propetors and editors but every citizen of the country that the primacy of the domestic print media is not subsumed by foreign players with a clear agenda that in most cases reflects the silhouette of neo-liberalism and the Washington Consensus (in the specific case of development issues).

Unfortunately the entry into India of big media from abroad is all but a foregone conclusion not only because they possess the resources to buy their way in through the political powers-that-be but also because these very powers-that-be stand to gain from undermining domestic print media and their democratic watch-dog function. We live in dangerous times.

A recent article in the Wall Street Journal (May 27-29 2005) with the above title makes an interesting argument about what is now a well known phenomenon: Traditional media businesses are struggling in the face of the onslaught of digital media and burgeoning competition in the age of the information explosion. The main question that is asked regarding newspapers is, "Why should people buy a morning newspaper when they have already received much of the day's news by email, dissected reports from multiple sources on the internet, got instant updates on their mobile phones and absorbed even more details from television and radio?"

While this trend amongst the traditional readers of the newspaper is becoming a growing problem for newspapers in India, in Europe things have gotten much tighter for the Fourth Estate. As the WSJ article suggests, however, the traditional media in this part of the world has responded using a variety of strategies, including:

1. Launching easier-to-read tabloid formats
2. Shifting more towards analysis than straight news
3. Embracing some of the very technological developments that have threatened their readership/circulation

Let us examine each in a little more detail.

Shrink the paper

As the article argues, one of the most noticeable changes is that many of the newspapers are shrinking. Papers such as the Times and the Independent in the UK and Die Welt in Germany have launched tabloid versions (again, a reference to size not content) so as to reach younger readers and commuters (note here the earlier references, in this blog, to free newspapers sustained by ads alone, which are given to daily commuters in public transport systems across Europe). However some experts argue that although many of the taboid editions have been very successful, their introduction will merely buy a few years of respite rather than arrest the long-term circulation decline. The real problem, the WSJ argues, is that the 'age effect' is becoming a generational effect, where 'age effect' refers to the following phenomenon: People grow up reading their parents' newspaper, then stop reading in their twenties, but return to newspapers when they are older- and often end up reading the same paper their parents did. Now, however, young people appear o be growing up with other alternatives to the newspaper and they are not returning. This makes it imperative that traditional newspapers must respond to changes in reader preferences in the younger generation.

News versus analysis

Again, as an example set by the Independent in the UK, one USP of newspapers is that they are possibly better positioned to offer much more than news, i.e. in-depth analysis of breaking and other stories. That is, the reader receives each morning a document that is more a 'viewspaper' than a mere newspaper. Of course, as the WSJ points out, this challenges some traditional notions of separation of news from analysis, but it is inevitable that such notions themselves need to evolve as the world in which they are applied does. As one expert argues, "The theory of separating facts from opinion was a very good practice, but the problem with readers today is that they are overwhelmed by news and information... The goal of a newspaper is not to give a thousand pieces of news bit to say, 'You've seen all this information' and now we say to you, 'Here are the four important pieces of news today, and here's what they mean'".

Blogs (Of course, I love this idea!)

Blogs and a new technological innovation, RSS feeds (which is available even on the Political India blog), are cutting edge digital tools that make news stories read by viewers more instantaneous, detailed and relevant to their needs. In addition, some blogs permit reader interface, and so feedback and opinion are given more importance. As the article explains, in France Le Monde has taken the blogging concept a step further- besides offering blogs by journalists, it also has some written by experts in a particular field. For example, "in advance of the French referendum on the EU's proposed constitution, the Le Monde site has hosted a blog by a member of the European Parliament and a law professor. Then on top of that, there are blogs written by regular readers".

While tabloidisation and other relatively dramatic changes are perhaps possible in the future in India, for example for The Hindu (as it faces the prospect of increasing competition in its home market), there is nothing preventing the leading English dailies from embracing the vast benefits afforded by the latest technology associated with the internet. In fact, in the case of The Hindu, a newspaper based on authenticity, credibility, expertise and seriousness, the idea of providing even more analysis of news would only srengthen its existing USP. Similarly most readers would agree that there is untapped potential for this worthy daily and several others in India, in terms of an improved web presence, perhaps incorporating RSS feeds as well as blogs. The future of traditional print media in India is uncertain, but it is also one that is filled with promise for the bold and the wise.

A Singaporean Sojourn

As The Hindu plans to enter into collaboration with Tamil Murasu in Singapore (to bring out an English news supplement with this Tamil Daily), one wonders what, if any, connection this move has to the looming threat of the TOI entering Tamil Nadu and unleashing the mother of all price wars. It is certainly commendable that the leading English daily of Tamil Nadu is considering a bold step beyond Indian territory. However, as the blog article below suggests, the degree of value-addition of such a supplement is as yet unclear, as news is anyway freely available on the internet and through a variety of media- and The Hindu itself sells for $1 (Singapore). The well-wishers of The Hindu hope that this (ad)venture will not turn into a cautionary tale.

Interestingly, there are a number of other dimensions of news presentation and analysis that can be improved in an attempt to face the onslaught of the internet and changing reader habits. A recent Wall Street Journal (Europre) article points the way, and an analysis of the ideas therein will be the subject of another blog article.

Read on...

Even as The Hindu braces up to confront the competitive challenges posed by the entry of Deccan Chronicle into its home turf of Chennai, with The Times of India lurking on the horizon, the 126-year-old newspaper is looking at a Singapore foray.

Talking to this writer after delivering a public lecture on “India’s News Media: Roles and Outlook”, in Singapore recently, Mr N Ram, editor-in-chief of The Hindu, said his newspaper was in discussions with Tamil Murasu, a daily published by the Singapore Press Holdings Limited, and with the authorities concerned on a possible collaborative venture.

But even if the plans are given the go-ahead, it will not be a full-fledged Singapore edition of The Hindu. In what will be an interesting arrangement, the local Tamil daily will incorporate a few pages of The Hindu for a unique bilingual package. “The tie-up will mean that The Hindu pages will be designed in Chennai and transmitted to Singapore for incorporation into Tamil Murasu,” Mr Ram said. The content will also be from its correspondents.

When probed on this, Dr (Ms) Chitra Rajaram, Editor of Tamil Murasu, said her newspaper first latched on to the bilingual mode in Singapore in 2002 and was now looking forward to The Hindu tie-up for a boost. While awaiting the official nod, there is no further clarity on timelines for the launch. Tamil Murasu has a circulation of around 10,000 in Singapore.

Dilution in Value

Given that The Hindu is among the top ten English language broadsheet newspapers in the world, I would think any Singapore venture with Tamil Murasu will mean a dilution in the value of India’s most respected newspaper.

Also, with the Chennai edition of The Hindu freely available in Singapore in the Little India area for a price of S$1 (Rs 26), it is unlikely if the local version will cut with the Indian expatriate community in the country. Newspapers, after all, sell as much for their local advertising as for the content. Moreover, with all Indian newspapers available on the Web, all information is just a click away from a reader perspective.

Competition in Chennai

On the looming competition for The Hindu in Chennai, Mr Ram said the price war unleashed by Deccan Chronicle would intensify once The Times of India launches its edition in the city. He agreed that there was a danger of The Hindu’s circulation taking an initial dip with the rival newspapers being sold at low prices.

The Hindu, a newspaper I had served for more than seven years, has a circulation of more than one million. Mr Ram was, however, optimistic that its rich tradition would help The Hindu weather the storm and emerge stronger. “We are also changing as you will have seen with our redesign launched on April 14. Even in terms of content we are incorporating features that cater to current tastes while ensuring that we remain a serious newspaper,” he said. In today’s world of fickle consumerism that is forcing businesses to evolve measures to contend with churn and stay afloat, The Hindu has been virtually immune to that phenomenon. Mr Ram hoped to keep the newcomers at bay with improved design and coverage.