Zenith has predicted a glowing 2019 for India's journalism industry: Print ad revenue is expected to grow by 5 percent in 2018 and by 20 percent next year. Digital ad revenue is also expected to increase by 20 percent.
How believable are these numbers? This past year, readership in India grew by nearly 11 crore (110 million), according to the National Readership Survey 2017. However, as we all know, there is no “One-Size-Fits-All” solution in news media. CEOs of leading Indian publishing houses came together at the WAN-IFRA India 2018 conference in Hyderabad to discuss the management of growth in print, while strategising with other platforms.
On the panel were Nikhil Kanekal (Executive - Group Strategy) from The Printers (Mysore), Krishna Prasad (former Editor in Chief) from Outlook, Samir Patil (Founder & Publisher) from Scroll and Rani Reddy (Director - Corporate Affairs) from Jagati Publications. The discussion was moderated by Manfred Werfel (Deputy CEO, WAN-IFRA).
Indian media is not homogenous; North differs from south, east from west. The country’s journalism market extends beyond the mainstream media to nearly a 1,000 newspapers. Rules that apply to the big players often don't necessarily apply to the smaller ones, which are larger in number.
Here are a few excerpts from the discussion:
Manfred Werfel: To what extent do you think are the Zenith numbers true?
Krishna Prasad: India is currently in a very happy spot with rising print circulation, even if there is a bit of a blip in terms of advertising revenue. A five percent uptick in advertising does not translate for smaller players down the line. Tender and appointment advertising are going down, which affects small newspapers, especially local language productions.
Mainstream English newspapers see a flurry of government advertising on the weekdays. It’s only over the weekend that one sees retail advertising. Hence, the 20 percent is misleading because it is suggestive of being applicable to everybody.
Samir Patil: A 20 percent rise for a digital company is negligible because 90 percent of that revenue will go to Facebook and Google.
Rani Reddy: National publishers have it comparatively easier than regional publishers. The 20 percent increase is on the base numbers. For a regional publisher, it does not make a large impact. While the growth might be 20 percent, we can’t increase our prices, so the company will have to spend the same amount on more newspaper pages, to match the growth.
Nikhil Kanekal: I am suspect of the numbers. Markets have remained largely flat in terms of advertising revenues. People have made cover price increase in some markets, but because India is a very price sensitive market, especially for vernacular newspapers, a few publishers have continued to stay away from it.
The results of some of the listed companies for Q1 and Q2 or the past two-three quarters show that advertising has fallen off a cliff. Most of the revenue is coming from some of the newer alternative revenue streams.
Digital businesses of course are growing, but most of the revenue goes to the Silicon Valley giants. We’re still away from achieving a properly monetizable digital media market; it’s still nascent.
Manfred Werfel: What strategies would you say are successful for growth in the publishing industry? Is brand-building important or does partnering with the big digital players get precedence?
Samir Patil: The most important strategy for Indian publishers would be to establish a direct relationship with the audience, rather than chasing scale. The big, digital platforms are not our friends, and they never intended to be.
Nikhil Kanekal: For digital media companies to succeed and scale, the future would comprise sharply targeted brands for specific audiences, and products that call out to a niche audience such as an ESPNcricinfo or a Scroll with a 10-20 million loyal digital following.
However, monetisation needs to be taken care of. For instance, for a high-quality website like ESPNcricinfo to still be free, is a shame, but that’s the nature of the digital beast.
Manfred Werfel: Are products aimed at certain audiences the beginning of the end of the newspaper or the way to go forward for news publishers?
Rani Reddy: If you look at how markets and trends work, you’ll notice a fall in the global print markets in terms of readership.
A publishing house is like a train with two engines. The first engine continues to focus on the core business – publishing, while the second engine is the business of the future. Engine 2 is bolder, tougher, faces more challenges, needs more investment and creativity.
However, both these engines need to learn to co-exist. Despite the investment in engine 2, a company can never be certain if the effort will pay off – it is a gamble one must make.
Samir Patil: A digital business with underdeveloped monetization can be pushed into two to three directions. It’s either an ad supported business, reader-paid business or producing videos and licensing them to other platforms.
The traffic that any publisher gets, is fractional compared to a platform, from an advertiser's point of view. Scroll is a digital-only platform and it does not have print functions. If you don’t have engine 1 and you’re just running on engine 2, one has no option but to figure out the benefits of digital only vs print and digital. How does one harmonise between the two mediums or do they go together?
Nikhil Kanekal: Our engine 1 is our cash cover that has been laying the foundation for engine 2, which is still too small in our business. One must make sure engine 2 takes off while Engine 1 is still running, otherwise the company will have to bring investors in.
Krishna Prasad: NYT is the biggest credible brand in the US, both in print and online. For the UK, it’s the Guardian. In India, legacy brands are facing a crisis in creating journalistic value in the digital space, which players like Scroll, The Wire and The Quint have successfully achieved.
Journalism goes beyond profits and revenue and the current media atmosphere in India is under grave threat. To see legacy players, abdicate their roles, speaks volumes. All these brands will survive and find their spaces, but we must examine what they are bringing to the table.
Rani Reddy: Consumption habits reveal clickbait news being read the most. What sort of content does a publisher generate if that is what a consumer wants?
Samir Patil: Indian media companies are strong establishments and in reasonably good health. Even though there is huge opportunity in digital, one doesn’t usually see a high-quality editorial product.
The gap between India and the rest of the world as far as digital upstarts are concerned, needs to be studied. When I launched Scroll, India was the second biggest source of traffic for every high-quality publication in the world – NYT, Economist, Guardian. One needs to possess either high quality or high scale; you can’t be middling. We have a lot of those in India because Engine 1 is supporting a mediocre Engine 2.
Nikhil Kanekal: In print you can get away with doing a little bit of everything, which does not work in the digital space. People, online, are looking much more closely at your brand promise. Hence, if you are a news media website, and are claiming to do journalism, people will expect that from you.
If you are putting up sleaze in the name of journalism, because people want it, you’re eroding your brand, which is not a sustainable business model. It might work in the short term to bump up page views.
People can find exactly what they want on the internet. In print, perhaps because people enjoy the monopoly of doorstep delivery, one can get away with content that is not very high-quality, from time to time.
Samir Patil: There’s enough of a supply of good quality content to test what the reader wants. When the NYT was just a print paper, it was read by 3 million people. Now, 90 million people read the website. At least one of your products needs to pursue quality. That there is no market for quality content is an incorrect argument.
Krishna Prasad: There is a market, even if it is a small one, for quality journalism and Indian legacy players have been woefully short of finding it. Because they have a huge reach, they are abdicating the responsibility of protecting this democracy.