Media Economics & Global Marketplace

Topic: ArtMovies
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Last updated: January 29, 2019

Media Economics & Global Marketplace Common structures Monopoly – a single firm dominates production and distribution, either nationally or locally. Eg: a city with one newspaper or tv station. More prevalent at the local level. Oligopoly – just a few firms dominate the industry. e. g. film industry–film studios. Limited competition – aka monopolistic competition – a media market with many producers and sellers but only a few differentiable products within a category.

For example, radio stations: there are various independently owned radio channels in India; however, most of these stations feature a limited number of formats, such as latest Bollywood songs, oldies, gags and similar content. Revenue Generation Direct payment – media products supported primarily by consumers who pay directly for the product. Consumers communicate their preferences immediately Indirect payment – media products supported primarily by advertisers, who pay for the quantity or quality of audience members that a particular medium delivers.The client is the advertiser, not the end user. Media spend in India as a percent of GDP is 0. 41%, which is much lesser than the world’s average of 0. 80%.

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This indicates the potential for growth in spends as the industry in India matures. The overall M&E industry size grew from Rs 579 billion in 2008 to Rs 587 billion at a rate of 1. 4% percent. The growth rate is expected to increase to 11. 2% in 2010, as the industry witnesses a recovery. TV and Print are the largest sectors of the industry contributing to greater than 70% of the revenues.

Traditionally, advertising revenues have had a strong hold in the M&E industry, but increasingly, subscription revenues are becoming important with consumers paying for media services. The media business models in India are undergoing a change with audiences becoming more willing to pay for content and value added services. The growth in ticket prices of movies at multiplexes, increasing number of Pay TV subscribers, increasing penetration of DTH with its user-friendly interface and technology, and introduction of Value Added Services (VAS) by media players are some examples of pay markets gaining importance.Print Media The Indian Print Media grew only marginally in 2009 as a decline in advertisement revenues were offset by growth in circulation revenues. The regime of foreign investment in Indian entities publishing newspapers and periodicals is as follows: – I.

Foreign investment (including FDI) upto 74% in Indian entities publishing scientific/technical and speciality journals, where only Indian editions of foreign journals are being published with no foreign investment being made, the Ministry of Information and Broadcasting will give approvals on a case by case basis subject to prescribed conditions.II. FDI upto 26% in Indian entities publishing newspapers and periodicals dealing in news and current affairs with suitable safeguards like verification of antecedents of foreign investor, keeping editorial and management control in the hands of resident Indians and ensuring against dispersal of Indian equity.

Television Sector in India In 2009, television industry stood at $5. 65 billion registering a growth of 6. 8%. The industry is projected to grow at a rate of 15. 5% and reach around $11.

45 billion by 2014.Growth of TV Channels in India: The number of private satellite TV channels grew from 1 TV channel in 2000 to 394 TV channels in 2009. Foreign Broadcasters: A number of foreign broadcasters are down linking their channels into India. A total of 67 TV channels, uplinked from abroad, have been permitted registration to be down linked in India during the years 2006-2009.

Eg WB, Discovery, NatGeo etc. DTH Service: DD DIRECT+ is India’s first and only FTA Direct-To-Home (DTH) service being provided by Prasar Bharati (a public service broadcaster). Apart from Prasar Bharati, Dish TV India Ltd. Tata Sky Ltd, and Sun Direct TV Pvt. Ltd.

, Reliance Big TV Pvt. Ltd. , Bharti Telemedia Ltd and Bharat Business Channel Ltd have also been granted license for operating DTH services. Eligibility Conditions: Total foreign equity holding, including FDI/ NRI/ OCB/ FII, in the applicant company not to exceed 49%, and within the foreign equity, the FDI component not to exceed 20%. It also provides that the applicant company must have Indian management control with the majority representatives on the board as well as the chief executive of the company being a resident Indian.Radio Sector In 2009, Indian radio industry stood at $171. 38 million and is expected to grow at a rate of 16% over 2010-14 and reach a size of $360.

32 million by 2014. FM Radio: In 2009, total 248 Channels are operational. Foreign investment is permitted up to 20% equity for FM Radio’s Broadcasting Services with prior approval of the Government. Satellite Radio: At present Worldspace India Private Ltd, a wholly owned subsidiary of Worldspace Asia Pvt. Ltd.Singapore is providing services under Foreign Investment Promotion Board (FIPB) approval. Community Radio: The policy on community radio was liberalized during the year 2008 to bring in the civil society and voluntary organizations working on not -for-profit basis under its ambit.

Earlier only educational institutions were permitted to set up a community radio. Presently, 29 community radio stations are operational. Advertising and Films 100% FDI under the automatic route is allowed in Advertising sector. 00% FDI under the automatic route is allowed in Film Industry including film financing, production, distribution, exhibition, marketing, and associated activities related to film industry. Global Marketplace Global investments by Indian players in 2009 • Reliance Big Pictures’ forayed into Hollywood through a joint venture with director Steven Spielberg with an initial funding of USD 825 million. • Broadcasters in India like Zee, Sony, etc.

have displayed global ambitions. Colors was recently launched in the US and UK as Aapka Colors, and is planning to expand to Europe, South Africa and Canada in the coming months. There is interest in Indian content internationally, which goes beyond the Indian diaspora. E. g. Vir Sanghvi’s Asian Diary was one of the leading programmes in Asia” • Network18 Group entering into a joint venture with Forbes, a leading US – based publishing and media company, to launch business magazines in India.

• Slumdog Millionnaire: Combination of Bollywood and Hollywood Indicative investments in India by global film studios in 2009 • Fox Star Studios produced the experimental ‘Quick Gun Murugan’.Karan Johar’s Dharma Productions and Shah Rukh Khan’s Red Chillies Entertainment also finalised an arrangement with the Murdoch-owned Fox studios mid last year for ‘My Name Is Khan’ • Warner Brothers continued its tryst with Bollywood by producing the Akshay Kumar starrer ‘Chandni Chowk to China’. • Carey Fitzgerald’s High Point Media Group is collaborating with Pritish Nandy Communications for the latter’s first horror film ‘The Accident’. • Channels like Star World Times Group Case Study The Times Group is the largest media conglomerate in India.

It is headed by brothers Samir and Vineet Jain. The company has 11 publishing centers, 15 printing centers, 55 sales offices, Over 7000 employees, 5 dailies, 2 lead magazines, 29 niche magazines, 32 Radio Stations, 2 Television News Channels, 1 Television Life Style Channel and turnover in excess of USD 700 million. Print includes The Times of India, The Economic Times, Maharashtra Times, Navbharat Times, All Mirrors Times Infotainment Media Limited ;amp; Entertainment Network India Limited includes Radio Mirchi, 360 Degrees Events, Times Outdoors, Mirchi Movies Limited Filmed Entertainment.Producers of BEING CYRUS, VELLITHERAI TIL (Times Internet Limited) includes Indiatimes portal and Times of Money TV Channels include Times Now, ET Now, Zoom, Movies Now Times Business Solutions include TimesJobs, SimplyMarry, Magic Bricks, Yolist, Ads2Book, PeerPower World Wide Media (A magazine joint venture between BCCL and BBC magazines) include Filmfare, Filmfare Awards, Femina, Femina Miss India, Top Gear Magazine, Hello, BBC Good Homes, Femina Hindi, Grazia, What to Wear


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