Room for More TV Chan­nels?

Slogan - - FOCUS - – S.W.

To­day, the face of Pak­istani media is dif­fer­ent from what it was a decade ago. Till 2001, media in the coun­try com­prised a sin­gle state-owned TV chan­nel and a few news­pa­pers. There was also a state-owned AM ra­dio chan­nel, Ra­dio Pak­istan, un­til 1998 when FM li­cences were given to non­state op­er­a­tors. There has been a sig­nif­i­cant growth in both print and elec­tronic media over the years, with kin­vest­ment seek­ing a piece of the pie in terms of own­er­ship.

The viewer, lis­tener and reader is be­ing beck­oned in dif­fer­ent di­rec­tions ow­ing to vary­ing poli­cies fol­lowed by each medium. Things have par­tic­u­larly changed with the in­flux of pri­vate tele­vi­sion and ra­dio chan­nels. Keep­ing the public has be­come a busi­ness that helps or­ga­ni­za­tions rake in huge prof­its by selling air­time to ad­ver­tis­ers. With more than a hun­dred news and en­ter­tain­ment tele­vi­sion net­works, chan­nel surf­ing now is al­most akin to drown­ing. You turn on the tele­vi­sion and des­per­ately search for clar­ity. Break­ing news is the prime min­is­ter breath­ing. Talk show analy­ses smack of dooms­day con­spir­a­cies. But we also re­al­ize that Pak­istan is no or­di­nary coun­try with its coups and car­nage. We watch help­lessly as the 7.00 to 9.00 pm news cy­cle is steam­rolled by events un­fold­ing at 9pm – or af­ter. There are count­less TV chan­nels to choose from so why does it seem like noth­ing is on? Has the mar­ket for the tele­vi­sion chan­nels in Pak­istan fi­nally be­come sat­u­rated?

Let’s look at the facts: Be­tween 2002 and 2005, the num­ber of satel­lite and ca­ble TV chan­nels in Pak­istan tripled. Advertising spend­ing on them in­creased 17 fold (from Rs200 mil­lion to Rs3.5 bil­lion). Sud­denly there was noth­ing ex­cept tele­vi­sion. Be­tween 2002 and 2012, tele­vi­sion view­er­ship went from 40 mil­lion to 124 mil­lion. Since 2008, the econ­omy has been in a slump. Advertising has shrunk too. That did not, how­ever, stop new chan­nels from open­ing.

To­day, the Pak­istan tele­vi­sion in­dus­try’s rev­enues are more than a whop­ping Rs30 bil­lion an­nu­ally. Some 90-95 per cent of that comes from advertising while the rest comes from syn­di­ca­tion or pro­grams sent abroad. Un­like their for­eign coun­ter­parts, Pak­istani TV chan­nels make ab­so­lutely no money from sub­scrip­tions. Mean­while, rev­enue from sub­scrip­tions in for­eign mar­kets makes up the largest share of their in­come.

For ad­ver­tis­ers, tele­vi­sion is one of the most ef­fec­tive media as it has a large-scale out­reach and to at­tract ad­ver­tis­ers, rat­ings play a vi­tal role. These rat­ings are mea­sured through a ‘Peo­ple Me­ter Sys­tem’ with hun­dreds of me­ters in­stalled in peo­ple’s homes in up to eight cities. The wind­fall from the advertising in­dus­try, in case of the top 32 chan­nels, is at best Rs592 mil­lion. On an av­er­age, ev­ery chan­nel earns roughly Rs1.7 mil­lion per month from advertising.

In com­par­i­son, a top-tier chan­nel will spend roughly Rs100m a month on con­tent but the ar­rival of for­eign, dubbed plays has brought the bill down dras­ti­cally. That ex­plains why media groups have ex­panded to in­clude en­ter­tain­ment chan­nels and why there has been a scram­ble for Turk­ish dubbed plays, but that has yet to trans­late into prof­its. Why? Since all chan­nels are avail­able free on ca­ble, there is only one source of rev­enue: advertising.

Un­for­tu­nately, that pie has not kept up with the new chan­nels. On the face of it, advertising is grow­ing 20 per cent per year but the num­ber of chan­nels is in­creas­ing even faster, say ex­perts. There is fierce com­pe­ti­tion and al­most all news chan­nels are be­ing sub­si­dized by other busi­nesses be­cause of which more than 90 per cent of news chan­nels are run­ning in the red.

Mean­while, up­com­ing new en­trants be­lieve they will not only be able to sur­vive but also trans­form the media land­scape. Ex­ist­ing play­ers, how­ever, are less than en­thu­si­as­tic be­cause they feel the mar­ket is sat­u­rated. “We may be headed for a pe­riod of con­tin­ued launches, be­cause peo­ple who have made money are en­ter­ing the media, but also a pe­riod when many play­ers are pushed to the brink to cut costs or exit or be un­able to com­pete,” ex­plains media an­a­lyst Gul­raiz Khan. Some media con­glom­er­ates, how­ever, con­tinue to buck the trend. Geo, a sub­sidiary of In­de­pen­dent Media Cor­po­ra­tion, went ahead and launched another news chan­nel, Geo Tez, and an en­ter­tain­ment chan­nel, Geo Ka­hani. Hum Net­work Lim­ited, the only pub­licly listed media group, has also launched a third chan­nel, Hum2.

Some­where in dis­tant fu­ture there may be busi­ness clo­sures and some form of con­sol­i­da­tion in the media. Un­til then, it seems, the bub­ble will con­tinue to grow, and float.

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