Thursday, March 15, 2012

Digitisation has disrupted revenue model of newspapers, says Rajiv Varma, HT Media CEO

The impact of galloping digitisation and proliferation of digital media on the print medium came in for close scrutiny at FICCI FRAMES 2012 here, with Mr, T N Ninan, Chairman, Business Standard, stating that the “Press is showing signs of stress”, that proliferation and consolidation in the in the Indian print market was taking place simultaneously and advertising going towards entertainment media while advertising in news content moving towards the internet.

“The Indian print market is displaying contradictory trends,” Mr. Ninan said and added that while proliferation is being seen in the form of new titles and new editions, consolidation is also evident. Eventually, however, proliferation would give way to consolidation. What is not clear is how long this process would take, he said.

Mr. Rajiv Varma, CEO, HT Media, in his remarks, noted that “the print medium has a bright future.” His optimism was based on the market dynamics in the eastern part of the world – Japan, Korea and Singapore – where newspapers are thriving. Seen from the western lens, the picture was not very encouraging, he said. For instance, in the U.S. print newspaper advertisements declined from $ 60 billion in the late nineties to $ 20 billion in 2011, mainly due to the impact of the internet.

Whether India is in the eastern or the western, situation was not very clear as it was difficult to predict how the audience is going to behave in the next decade, he said and remarked, “The best strategy would be to plan for the worst and hope for the best.”

Ms. Lynn De Souza, Chairperson and CEO, Lintas Media Group & Chairperson, Readership Studies Council, noted that the Indian print market remains buoyant. Advertising spends during the last five years have doubled -- from Rs 15000 crore to Rs 30,000 crore. The share of the print media at 40 per cent has remained unchanged.

Asked by the moderator of the session, Mr. Swapan Dasgupta, Columnist and Senior Journalist, whether at all there is a viable revenue model to make the print medium hold its own, Mr. Varma said that digitisation has disrupted the decades-old model of making the reader walk through the news stories in a newspaper to reach the advertised product or message.  Mr. Ninan pointed out that internationally the business model is subscription-led and at some point of time India would have to move towards that model.

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