The Times Group's new business channel, ET NOW, leverages on the combined resources of the channel and its print sibling, The Economic Times. Will the model work?
The fight for the Rs 325-crore advertising market in the English business news segment has intensified with the entry of ET NOW, the long-awaited television channel from Times Global Broadcasting Corporation Ltd, the television arm of Bennett, Coleman & Company Ltd. Times Global Broadcasting currently operates the company’s three-and-a-half-year-old general interest news channel, Times NOW. Launched on June 21, ET NOW is India’s fourth English business news channel which will compete with CNBC-TV18, NDTV Profit and UTVi for eyeballs and advertising.
But being number four does not ruffle Chintamani Rao, the CEO of Times Global Broadcasting: “I have said this before and I can say it again, for us there is only one competitor — CNBC-TV18.” ET NOW has clearly trained its sights on CNBC, the 10-year-old market leader from Raghav Bahl’s TV18 Group. According to TAM data, between May 10 and June 13, CNBC-TV18 enjoyed a channel share of 68 per cent, followed by NDTV Profit at 25 per cent and UTVi at 7 per cent.
In its pursuit of leadership in the segment, Times Global Broadcasting has set out to create a distinctive business model as well as positioning for ET NOW. For a start, the channel is using the same brand name as its successful print product. (Bennett, Coleman & Company publishes India’s largest English business daily, The Economic Times, popularly known as ET). “At the risk of sounding pompous, I could say that ET NOW is a world first. In business news, no print and television products share a brand name,” says Rao.
Come together
In fact, the common brand name has its genesis in the concept of creating an integrated newsroom where the channel draws on the resources of the newspaper and the newspaper feeds on the television channel. Explains Neeti Chopra, brand director for ET who now manages ET NOW as well: “The very fact that the brand functions of the newspaper and the business channel have been integrated and that the editor for the paper and the channel is the same explains the model we are following.”
ET NOW has a dedicated staff of 300 people, including the editorial team. However, in addition to this, The Economic Times reporters also appear on television. The news breaks in print are put on air and vice versa. That, Rao claims, is the unique selling proposition or the differentiator for the channel.
ET NOW is not a pure stock market channel, a position occupied by CNBC-TV18 and later followed by NDTV Profit and UTVi. “ET NOW is not a ball-by-ball commentary on the stock market. It’s a mix of stock trends and business news,” explains Rao.
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Clearly, the differentiator is reflected in its positioning as well. The channel tagline says, The Economic Times Advantage. “We could have said we will change your life or we will make you profitable, but the truth is that we’re bringing The Economic Times’ core strength of breaking business news to the viewer,” says Chopra. To promote its business channel, Times Global Broadcasting has liberally used its print media brands, The Times of India and The Economic Times, for publicity. It also made use of the outdoor (Times owns an outdoor company as well) with bus shelters in Delhi and hoardings in Mumbai.
Who’ll rule?
But being backed by India’s largest media conglomerate does not mean that ET NOW is devoid of challenges. For starters, Jehil Thakkar of KPMG feels that in the medium- to long-term, there is not enough room for four players, though ET NOW may help grow the market initially.
Then there is competition. Media analysts say that though ET NOW could offer great coverage, CNBC-TV18 is a formidable brand. Adds KPMG’s Thakkar: “ET NOW is a strong brand with access to the newsroom and content of The Economic Times. There is a synergy there. However, CNBC-TV18 is the leader by far. The real battle will be between the two.”
A senior TV18 executive does not agree and says that the new channel will first need to contend with NDTV Profit and UTVi before eyeing the leadership slot. However, Shantonu Aditya, executive director of UTV Global Broadcasting Ltd, feels that there is opportunity for differentiated content in the Indian market. “We are positive about UTVi’s future… We are the only business news channel that gets a higher weight of viewership in cable homes from the young in the 25-44 years age group, unlike the older channels where 45-plus and 55-plus viewers form the core.”
Other than stiff competition from existing players, channel visibility could be an issue. The new channel is not available in parts of the country.'
Rao claims that distribution deals have been signed with most cable operators in Mumbai, Delhi, Bangalore and the whole of Gujarat. “We will now focus on making it available on the DTH (direct-to-home) platform,” says Rao, promising to scale up distribution quickly. Rao admits that carriage fee paid to cable operators for distribution is steep and upsets the cost structure of TV channels. “It is a fact that new entrants pay more than their predecessors,” he says without divulging the carriage fee that ET NOW has had to pay.
Rao insists that the channel has saved on cost as it shares the sales and marketing team as well as the human resources team with Times NOW.
Will it work?
So will the integrated news room experiment work? It’s the first time that there’s been a complete convergence between print and TV. Says Aditya of UTV Global Broadcasting: “I cannot recall any line extension in media that has worked. TV channels are driven purely by content and not by ownership. Television as a product is quite different from print… and, therefore, while promotion does play an important role and line extensions give that definite edge to a new entrant, the real success depends on the quality of the product that follows.”
Rao insists that there is no question of the experiment going hay wire. “It’s not that suddenly we got up one day and decided to use the newspaper reporters. The entire organisational structure has been designed according to our business model.” There are integrators whose job is just to integrate the operations. “It could become a new model for others to follow,” adds Chopra.
But the TV18 executive says that the question is not about the model but how viewers react to the channel. Conventional wisdom says that the launch advantage stays for only about four weeks. After that, the channel has to perform.