PLAYING TO THE NICHE GALLERY
Every morning before work, and in the evening, after coming back home, Srikanth Iyer figures out how to spend his free time. When not out and about in Bengaluru city, the 33-year-old software professional surfs the Internet for a while, and either listens to music, or decides to watch something on Television. And that something, on many a day, is a show on National Geographic, Discovery channel, or TLC. On being asked what he watches, he rattles off names of shows such as Dead by Dawn, Africa’s Deadliest, and Wild Encounters that he says are regular choices for him. He also watches cookery shows by celebrity chefs Gordon Ramsay (Gordon Ramsay: Uncharted), Sarah Todd (My Restaurant in India), among others. Audiences like Iyer are the ones that broadcasters of niche channels have banked on, especially last year, which saw the implementation of the New Tariff Order (NTO) by the Telecom Regulatory Authority of India (TRAI) on February 1, and a consequent dent in their viewership and revenues. Even as the industry completes a year of being in the NTO ecosystem, with broadcasters having looked for ways to modify and grow themselves in the meantime, further amendments to NTO and interconnect regulations were released by TRAI on January 1, 2020. Though the new amendments are far from being implemented as broadcasters have gone to court against TRAI, what experts say is that niche channels will face big problems due to capping on the number of Free to Air (FTA) channels by a broadcaster, and may end up moving directly to OTT/digital platforms in the extreme case. NAVIGATING THE NTO ECOSYSTEM Niche channels (English Entertainment, English Movies, Infotainment, and Lifestyle) faced a setback in 2019, especially English language channels that are said to have lost both audiences and advertisers. As the year passed, additional toll from a weakening economic environment further pressured the channels, something that has impacted the media and entertainment industry as a whole. Phrases such as ‘reset for the industry’, ‘huge transition’, and ‘biggest disruption for the industry’ were commonly used to address the change in the ecosystem following the implementation of NTO. Girish Menon, Partner and Head, Media and Entertainment, KPMG India, believes that niche channels have been facing headwinds since the implementation of the NTO, especially the ones that are not part of a big network. “Big broadcasters with presence in niche segments have been able to place some of their niche channels in the bouquets that they offer. In addition, their relationships with distributors enables them to position some of these channels in different DPO packs,” notes Menon. Even in terms of advertising money, there was a move towards bigger broadcasters, which cushioned the impact from the decline in niche channels. Here’s how amendments to NTO, recommended by TRAI, affects niche channels By Tasmayee Laha Roy How the new tariff order (NTO) regime has affected broadcasters who offer niche channels has to be seen now in the light of NTO 2.0 – the Telecom Regulatory Authority of India’s amendments to NTO announced on January 1, 2020. The talking point is whether the new recommendations - intended to address market anomalies as per TRAI - are actually jeopardising the future of niche offerings by broadcasters. Broadcasters with niche channels complained that NTO had no cap for the maximum number of Free to Air (FTA) channels offered by a broadcaster earlier, so niche channels could move towards FTA. However, capping has now made the segment highly competitive. Niche channels are generally the non-driver channels which were bundled in a bouquet by broadcasters in the NTO regime. But has capping MRP of a channel at Rs 12 against the earlier Rs 19 actually helped in creating more opportunities for all channels as TRAI claims? Explaining how NTO 2.0 impacts niche channels, Naval Seth, Deputy Head of Research at Emkay Global says, “Broadcasters have been pushing non-driver channels along with mainstream channels in bouquets. We believe that the reduction in channel pricing cap will impact broadcasters only if a large proportion of subscribers shift to a-la-carte model and subscribe to fewer channels. Large broadcasters (Zee, Star and Sun TV, etc.) that have driver channels (featuring in top 3) across the genres will have limited impact or risk of revenue loss due to the shift to a-la-carte. However, the impact could be in the form of lost advertisement and subscriber revenues due to the non-subscription of non-driver channels.” “The audience looks for convenience. They don’t want to scan through a-la-carte offerings for niche channels. The niche channels will, therefore, be ignored,” says a senior member of the broadcaster fraternity who wants to remain anonymous. English, for instance, is one niche category that has been amidst bad times since the implementation of NTO and NTO 2.0 seems to provide no relief to the category. A KPMG report titled India’s Digital Future – Mass Of Niches mentions that the introduction of the new regulatory order in the last quarter of FY19 has added to the challenges with the uptake of English pay-TV channels taking a hit and channels expecting a drop of 25-30% in their revenues post the NTO. Only the channels/broadcasters that have been able to place themselves in a sufficient number of DPO packs are likely to find decent pick-up. So where does it leave the niche channels? Will they look for greener pastures in terms of newer platforms? “We believe that India will remain a bouquet subscription market while increasing options of lower a-la-carte offering do pose risk for broadcasters amid rising acceptance of OTT platforms,” said the analysis by Emkay Global. “There was a flight to the leaders in terms of advertisers,” says Jehil Thakkar, Partner and Leader, Media & Entertainment Sector, Deloitte, adding that while marketers were not sure whether they would pick a small channel or not, they would always look at having channels from larger networks. Industry experts, and BARC data, however, indicate that while there has been some impact, many of the channels have weathered the storm and have held their own. “On the entertainment side, there was a period of flux, primarily because the first set of adoption was for the base, or base plus one packs, and therefore, the adoption for English entertainment took some time,” says Vivek Srivastava, President, Strategy and Business Head, English Entertainment Cluster, Times Network, adding that in about three or four weeks after NTO came in, the channels were back on ground. There was a period of data blackout initially that also impacted the niche channels, say some of the experts. “There was only back-up data at that point of time, and niche channels struggled quite a lot then,” says Anand Bhadkamkar, CEO, Dentsu Aegis Network India. Over the last six months that has settled down, he adds. Navin Khemka, CEO, MediaCom South Asia, says, “A combination of various factors like NTO, premium pricing, SD feed, HD feed, OTT players’ aggressive content led to audiences migrating to newer platforms.” Ashish Pherwani, India Media & Entertainment Leader, EY, also says, “What we’re seeing is a movement of English audiences to OTT because of the quantum of excellent content, getting bundled at low data prices.” He adds that the infotainment channels have held up in the post-NTO scenario. However, according to Karan Taurani, VP - Research Analyst (Media & Consumer Discretionary), Elara Capital, niche channels of broadcasters will face big problems due to the capping on the Free to Air (FTA) front. As per the earlier order, there was no capping for maximum number of channels in FTA, which implied that more niche channels would move towards FTA. Now, as per the amendments in NTO, DD channels will not be a part of the FTA pack and distributors cannot give more than 160 channels in the FTA pack. “This capping is a negative for the ancillary channels of broadcasters as the FTA cap makes the segment highly competitive. We expect niche genre channels to move directly to OTT/digital in that case,” explains Taurani. Discovery: The premiere of Man Vs. Wild with Prime Minister Narendra Modi on Discovery Network (across 12 Discovery channels) garnered the highest slot viewership (on active channels) with 3.69 million impressions overtaking GEC leader Star Plus with 3.67 million impressions. (BARC - TG: All15+AB|Market: India Urban|12 th Aug’19: 9pm-10pm|Impressions) &flixHD: Since the NTO regime was launched, &flixHD has witnessed a 40% increase in ad insertions, between August 2018 and August 2019. (BARC Data) Romedy Now: It maintains #1 rank in English GEC genre with improved share from 27% in Pre NTO to 44% in Post NTO phase (Source: BARC | Market: All India 1Mn+| Period: Wk 46-6’18 & Wk 47-50’19 | TG:15-50 NCCS AB) Star Movies India Sony Pictures Networks India Times Network Viacom18 ZEEL Network18 EPIC TV HBO ON THE ROAD TO STABILITY If one considers the period following the implementation of the NTO, monthly impressions among English Movies, English Entertainment Channel (EEC), Infotainment and Food & Lifestyle genres have increased. The EEC genre impressions, for instance, grew from 1,39,66,000 in April to 1,81,71,000 in November of 2019. Similarly, impressions in the Food & Lifestyle genre grew from 898,83,000 in April to 1047,52,000 in November, 2019, according to BARC data. But in the interim, while attracting advertisers was essential, at the initial stage of NTO implementation, attracting audience attention was equally important. There was confusion in terms of how the audience interests would pan out, since the choice was now supposedly in their hands, as they would have to now consciously choose the channels they wanted to watch. Considering costs would be more in the post-NTO world, these choices would be more discretionary in nature. Amit Shah, Cluster Head, West, North & Premium Channels, ZEEL, points out that while pre-NTO, the biggest challenge was that the universe for niche channels was very small, the transparency would now help. “We are now moving towards a more organized and transparent system which will eventually benefit premium channels in a big way,” says Shah. Broadcasters understood that it would be essential to reach out to customers, especially the ones who might want to watch shows on niche genres, but need more convincing. And while it took time for the channels to understand the environment, many of them had initiated processes even before the NTO was put in place, and some immediately followed the implementation. Broadcasters reached out to viewers to build awareness, and brand recall, by offering them lucrative packages. Ferzad Palia, Head – Youth, Music & English Entertainment, Viacom18, says, “Any big change requires time to adjust and adapt. However, with the new industry-wide changes, consumers will now be more aware of their choices and the value that individual channels bring to their entertainment habits and needs.” According to ZEEL’s Shah too, selecting channel packs was a new behaviour that urban English consumers were not used to, and there was a need to help consumers through the decision funnel. Hence, ZEEL launched a campaign for its English Cluster - #WhereIsMyChannel - which featured popular celebrities like Anurag Kashyap and L Sivamani, to nudge consumers to be more active in making a purchase decision for international entertainment on Television. “While everyone was busy promoting their base packs, we took the conversation to the next level by talking about the ‘top-up packs’ with ‘Zee Prime English Pack’,” says Shah, adding, “The campaign reimagined the tonality for the English cluster making the channels more conversational, accessible to aspirational audiences beyond metros.” For Times Network, brands became more important than individual properties. “That was the key shift that happened because earlier, it was a given that the brand will be available in the household. I had to only really tell my viewers, please come and watch this property, at this time, on this channel… Now, it’s a choice of selection of the brand and therefore we moved from property to platform,” says Srivastava. Times Network, which runs the Movies Now, Romedy Now, MNX, and MN+ channels, also stepped up with its Tentertainment Pack with three of its entertainment channels priced at Rs 10 per month, and M.A.N (an acronym for Movies and News) Pack priced at Rs 13 per month, in order to stay attractive for its viewers. Sony Pictures Networks India also came up with a Happy India English 12 pack, with its channels Sony Pix, AXN and Sony BBC Earth, and Star & Disney India launched its Star English Special Pack which included Star Movies, Star World and Fox Life channels. Post declaration of NTO 2.0, broadcasters were required to publish revised MRP of a-la-carte channels and bouquets on their website by January 15, 2020 and DPOs were required to publish revised DRP of a-la-carte channels and bouquets on their website by January 30, 2020. The amended provisions were to be effective from March 1, 2020. However, since the broadcasters’ body Indian Broadcasting Foundation (IBF) has challenged the amendment that TRAI made to the NTO in the Bombay High Court on January 13, the new channel prices and packs are yet to be announced. Ferzad Palia FINDING THE REAL AUDIENCE During the big change in the form of NTO, there has been a modification in audience base, along with the supposed decline in viewers for niche channels, say industry experts. The ones that have stayed, and are subscribed to niche channels, are representative of a set of true, or real audiences. “There has been a little bit of loss of viewership, or reach, that the category has experienced, and that really is the frivolous viewership that has gone off, the core of the segment stood where it is,” says Srivastava of Times Network. According to the broadcaster, Romedy Now saw an increase of relative channel share from 27% in the pre-NTO days, to 44% post-NTO. Movies Now’s relative channel share also rose from 19% to 36% in the post-NTO environment. “We believe consumers are willing to pay for channels that they are genuinely watching and will continue to do so,” comments Rohit Bhandari, Senior Director and Network Head, English Entertainment, WarnerMedia Entertainment Networks, agreeing that NTO was disruptive for the ecosystem. Bhandari also notes that HBO figured high in terms of Time Spent Viewing amongst the NCCS A audience “proving that great content curated and presented by a quality brand will always be consumed”. Rajul Kulshreshtha, CEO, Madison Media Plus, also says that NTO has helped niche channels find their true audience. “There were others who were watching these channels because they had taken a package and were saying, ‘Because I have got it, I must see it.’ But they weren’t really the involved audiences. Now they have got a real audience,” he says. Viacom18 says it has managed to increase consumption from its loyal base and also acquire fresh subscribers through its content and outreach programmes. According to the company, Comedy Central ranked No. 1 in its genre in 20 out of 22 weeks till date, and had an average market-share of 50%. Megha Tata, Managing Director- South Asia, Discovery Communications, notes that the time spent on Discovery has gone up by 35% despite a decline of 20% in its reach, which is because of viewers who are ‘pure loyalists’. “Now that is the value you’re bringing to the advertiser because you are getting a very focused viewer, and not someone who is a flirter,” says Tata, who manages channels such as Discovery, Animal Planet, and TLC under the network. Advertisers are taking note, say industry experts. Kulshreshtha of Madison Media Plus says the presence of real viewers can help both brands and broadcasters be relevant to the viewers. Pradeep Dwivedi, founder of Divitiae, also believes that the kind of consumers certain brands would be seeking are the ones who watch these niche channels. “Advertisers do seem to be taking cognisance of the fact that loyal viewers which are the ones they advertise on English for, are still very much around and that the loss has only been from infrequent/snacky viewers,” says Ferzad Palia, adding, “The story will play out over the next few months.” Amit Shah suggests that since most of the English content available on OTT has limited access, brands find it difficult to partner with this content, restricting their exposure and reach. “To reach out to our affluent viewers, they have partnered with us on impact campaigns to drive perception and recall. Hence, it goes without saying that TV is and will continue to be the best platform for the advertisers to get associated with this quality content and target the relevant TG.” says Shah. Channels such as &flixHD have gained momentum in advertising since the NTO regime was launched. According to ZEEL, the English movie channel witnessed a 40% increase in ad insertions, between August 2018 and August 2019. Brands such as Mahindra note that it depends on whether one is looking to reach a general audience or a more specific audience segment. “For a general audience, a brand would look at GEC channels but for a more specific audience, a brand would look at more niche channels which suit the objective,” says Vivek Nayer, Chief Marketing Officer, Group Corporate Brand, Mahindra & Mahindra. For a recent campaign on Waste Management called #CuttheCrap put out by Mahindra’s Corporate Brand, the brand supplemented the usual Digital & Social media channels with spots on some select TV channels such as Discovery, National Geographic and Sony BBC Earth. “The reason for choosing these particular channels was that their core audience is more evolved and more conscious of social and environmental issues. Hence, the answer lies in sharper targeting of your audience,” says Nayer. Not only is the advertising ecosystem for niche channels getting more streamlined, but increasingly, channels are looking at benefiting from improving subscription numbers. However, experts believe this is not enough for niche channels to sustain and grow in the long run because the environment today has changed, and the relationship that broadcasters shared with both partners and advertisers over the years, is also not the same anymore. “The relationships were set, so a lot of guys were comfortable,” says Thakkar of Deloitte, adding that while there was focus on driving subscription revenue, there was little aggression to promote their value proposition to existing brands, and attracting new brands. Kulshreshtha of Madison agrees: “Let’s say the decline was in the region of 40%. So the conversation that broadcasters should have with the brands is about showing the value of the existing number,” he explains. Some broadcasters have taken note, and have benefited by partnering with new age advertisers. Times Network has been working on providing an experience to its advertisers and are offering them a TV plus digital offering. This has attracted non-traditional advertisers towards the network. The network counts Amazon, Xiaomi, Trivago, Google, L’Oreal, ITC, Philips, and Swiggy, among advertisers. Even ZEEL has experienced continued demand from premium advertisers across automobile, telecom, BFSI and digital-led platforms, who have found a great fit with this category, that caters to a unique set of influential and aspirational audiences, through its content. According to Dwivedi, there has been a strong accent on branded content, and ad funded programming. “There is a very clear emphasis on co-created content with brands. Brand salience is integrated into the content, while retaining the content as relevant to those niche audiences,” notes Dwivedi. For instance, Viacom18’s Comedy Central created a talent hunt for the next comedy sensation with ‘Sterling Reserve Comedy Project’. The channel partnered with Sterling Reserve for the show that was hosted by stand-up performer Varun Thakur. Sum of Impression’000 (Source: BARC. TG: India 2+) CONTENT AND MARKETING INNOVATIONS Not only has it been essential for niche channels to maintain relationships with advertisers, and spread awareness among consumers, it was essential to maintain audience interest in its content. Broadcasters have been working on various content and marketing strategies to make sure that viewers continued to find the channels interesting, especially at a time when OTT platforms are said to be taking away viewers from television screens. Experts also suggest that it is essential for channels to improve their content curation, which has been a concern in relation to OTT platforms that not only bring in fresh content almost every day, but are able to offer differentiated content that would bring viewers back every single time. “A lot of movie channels have relied a lot on library, and that too not a very recent library,” observes Thakkar of Deloitte. For English movie channels, the clincher of late has been movie premieres closer to their release dates, not just in India, but also internationally. For networks such as ZEEL, the biggest disruption in the English movies’ category was the launch of ‘World Television Premieres’. “This solves a big consumer challenge that the category has been facing for long. Movies would usually take 10-12 months to premiere on TV by which time the buzz and excitement around the movie is lost,” says Shah. The network’s English cluster was able to showcase blockbuster Hollywood movie premieres within five months of their theatrical release. “Moreover, our focus has been to keep a TV-first approach where over 70% of our content is released on the channel first, before it appears anywhere else (on any other platform). With that, our proposition to the consumer to consume the content on Zee Café is extremely strong because of the uniqueness of our content,” adds Shah. The network has promoted campaigns such as ‘Privé Unscripted’, ‘The Winning Side’, ‘BBC First’, ‘Along With The US’ and the ‘Flix First’ block, to lure more viewers to TV screens. Similar are the efforts by Viacom18: “Our line-up of ‘Instant Premieres’ and ‘Watch With the World’ on Colors Infinity and Comedy Central respectively, premieres shows and events within hours of their international premiere and we’ll continue to add to the bouquet of offerings,” says Palia. Some of HBO’s biggest premieres this year also included famed movie titles such as ‘Fantastic Beasts: The Crimes of Grindelwald’, ‘Aquaman’, ‘Bumblebee’, ‘A Star is Born’ and ‘Mission Impossible: Fallout’, amongst others. Times Network introduced its first original show, Love, Laugh, Live, on Romedy Now. Srivastava says the network is in the process of producing at least a couple of shows every quarter. For niche channels, it isn’t just enough to match up with the international content roster, but essential to localise initiatives as well. The key strategy to reach, and connect with, audiences, is broadening the base. Thakkar of Deloitte believes that as older broadcasters understood that Indian shows would work better that international ones, the same is applicable to niche channels as well. Broadcasters today are spreading their net wider so as to connect with viewers at a deeper level, and build a sustained relationship. Discovery Network benefited from a single episode that featured Prime Minister Narendra Modi on one of its shows. “What really worked for us, and hit the ball completely out of the park was the PM Modi episode with Bear Gryllis on Man vs Wild. It happened around August 2019, and we beat even Star Plus on that slot,” says Tata of Discovery, adding, “Who would have ever thought that a factual entertainment channel, would be No 1 over general entertainment!” According to the network, the premiere on Discovery Network (across 12 Discovery channels) garnered the highest slot viewership (on active channels) with 3.69 million impressions, overtaking GEC leader Star Plus with 3.67 million impressions. It also saw a premiere slot performance grow 50 times, giving an unprecedented 93% channel share to Discovery amongst the infotainment genre. Network18’s infotainment channels History TV18 and FYI TV18 have worked on localisation of content in the form of India-specific shows such ‘OMG! Yeh Mera India’ and documentaries like ‘India Inked: History’s Biggest Election,’ which was created in association with the Election Commission of India. In an earlier interview with exchange4media, Avinash Kaul, Managing Director, A+E networks I TV18, and CEO Network18, said such documentaries commanded an ad rate hike of around four to five times of normal rates. HBO too banked on the global popularity of comic book character Batman, and celebrated the 80th anniversary of DC’s most sought-after and successful franchises, where the channel had a line-up of popular Batman movies, with its ‘Long Live the Bat’ campaign, which was supported by on-ground fan engagement activity at DLF mall for Batman Day. “We’re also constantly looking at reinventing our fan-engagement approach. This year, our innovation included an AR filter (Gamified version) for the ‘Mission Impossible: Fallout’ premiere, wherein fans could get the experience of being an MI6 agent in the virtual world,” says Bhandari of WarnerMedia Entertainment Networks. To promote one of the most famous sitcoms on the network, ‘Friends’, Comedy Central India and Warner Bros. Television Group brought a specially created replica of the iconic Central Park orange couch to India, and rewarded the winner of the ‘Wackiest Friends Fan’ contest with a paid trip to New York and a visit to the sold-out Friends 25 Pop-Up Experience along with a friend. “Our unique on-ground and digital marketing initiatives that engage the massive new-age audience, continues to deliver higher visibility in the market,” says Palia. EXPLORING NEWER MARKETS As niche players work towards contending with OTT platforms for entertainment time among its existing audience base, newer markets need to be explored, and some broadcasters are following that path. In order to reach out to the Hinglish-speaking viewers, ZEEL launched initiatives with Indian celebrities - campaigns such as #VenomInMyVeins anthem for &flix in association with KaamBhaari and Slow Cheeta, and #ShakenAndStirred campaign for BBC First on Zee Café featuring Nawazuddin Siddiqui. “With the success and positive reception for these campaigns, working with India-specific celebrities and influencers has become key to our marketing strategy as it’s through them that we can establish a stronger connect for acquired content,” says Shah of ZEEL. Not only is speaking to views in the metros important, networks have consciously looked at opportunities in the non-metro geographies as well. Times Network, for instance, has spread out its attention beyond metro cities, and this is reflecting in its marketing efforts as well. “We don’t really spend a lot on localised mediums in the metro market because we know our penetration is largely at a saturation level. Our only work here is ensuring a reminder. The build-up of newer viewership is actually happening in the smaller towns, and that’s where we’re headed,” says Srivastava of Times Network, adding, “Today I am going to Jaipur, I’m going to Bhopal, I am going to Varanasi. That is where the geographies are increasing, even for Hollywood movies. We are only following ground realities.” Experts, however, feel that channels that operate in unique segments need to expand beyond their role of programmers on a single medium, and create multiple touch-points with their audience. “We’ve got to stop looking at it as modes of distribution. It will become a community play,” says Ashish Pherwani of EY, and, according to him, syndication is the way forward to do this sustainably. One may or may not be able afford a separate app. But one can definitely syndicate content to so many media and non-media apps and destinations. “Therefore, there will be a content business, and all the rest would be services, which can work through partnerships that require minimal investment,” Pherwani adds. As niche channels look at newer ways to enhance their value add to both viewers and advertisers, new methods of growth are likely to be explored as the sector moves ahead. AND NOW, HERE’S NTO 2.0
NICHE & NOTEWORTHY
CAMPAIGNS & PARTNERSHIPS
Megha Tata
Managing Director- South Asia, Discovery Communications
Vivek Srivastava
President, Strategy and Business Head, English Entertainment Cluster, Times Network
Amit Shah
Cluster Head, West, North & Premium Channels, ZEEL
Head – Youth, Music & English Entertainment, Viacom18
Vivek Nayer
CMO, Group Corporate Brand, Mahindra & MahindraHOW NICHE CHANNELS HAVE FARED