 "Movie channels ready script to buck ad cap")
While the jury is still out on whether the limit on advertising time will be applicable to news broadcasters or not, other genre networks are working around the imminent curb.
The ZEE Group, for instance, is contemplating launch of a new Hindi movie channel under the ZEE Cinema umbrella. Ad sales executives from the network are making presentations to advertisers and media buying agencies, apprising them of its plans for the new channel, persons in the know say.
Apart from news channels, Hindi movie channels have the maximum advertising per hour of programming. This ranges between 20-22 minutes an hour while Hindi general entertainment channels have about 14-16 minutes of ads an hour.
News broadcasters have tried tackling it differently so far. They have appealed against the Telecom Regulatory Authority of India's (Trai's) ruling to cap advertising time on television channels to 12 minutes an hour to declutter TV content.
On an average, broadcasters derive nearly 60-70 per cent of their revenue from advertising. The balance comes from subscriptions, unlike overseas markets where subscription revenues are more. Following the appeal, the Telecom Disputes Settlement & Appellate Tribunal (TDSAT) has asked the broadcasting regulator to respond in two weeks.
Ad rates across TV channels have already begun to climb, in anticipation of Trai's ruling, in the last two weeks, after remaining stagnant for much of the first half of this calendar year (as earlier reported on this page). The increase has been to the tune of 8-10 per cent, with media buyers expecting rates to peak at about 25-30 per cent in October. But, broadcasters are acutely aware of advertisers' resistance to higher ad rates during the slowdown. With limited options in rate increase, launching new channels could be a better bet, experts say.
Executives at ZEE Entertainment Enterprises Ltd (ZEEL), the company within the ZEE group that manages the entertainment business, denied they were launching a new Hindi movie channel when contacted. But persons privy to details say the group has been working at a fever pitch to get the channel up and running in the next two months.
ZEEL will not be the only broadcaster to go down that road. Speculation is rife that the STAR Group is also mulling a new movie channel under the STAR Gold banner. But a STAR India spokesperson denied this piece of news describing it as rumour.
Media buyers, however, say that the Rupert-Murdoch-controlled network has been giving them indications of a possible launch for some time now. "It is a question of when STAR decides to blink," says a senior media planner with a top-ten media agency.
ZEEL has four Hindi movie channels - the flagship ZEE Cinema, ZEE Premiere, ZEE Classic and ZEE Action. Shailesh Kapoor, chief executive of media consultancy Ormax adds, "The Hindi movie genre tends to be title-driven. ZEEL already has a vast library of films, both current and old, which could be utilised appropriately across its bouquet of movie channels. The new movie channel is unlikely to compete with the flagship one. Instead, it will target peers from whom it could take away some share of revenue, thereby boosting ZEEL's overall revenue."
The channel, likely to go on air in the next two months, may target a growing viewership, especially in the north, of English and regional-language films dubbed in Hindi. "There is an appetite for these films," says Farokh Balsara, partner and media & entertainment industry leader for Europe, Middle East, India & Africa at Ernst & Young. That might help ZEEL keep new blockbuster titles, for which channels fight tooth and nail, for its flagship channel and keep up a differentiation for the new one without spending a lot.
A fifth channel, experts say, could strengthen the bouquet and keep viewers from going out of the network. However, a new channel in same genre also has a flipside. With every launch, fragmentation of audiences only grows, points out Abneesh Roy, associate director, research, Edelweiss. Broadcasters then, will have to be mindful of the trap of too many channels targeting one genre.
HOW WILL NEW CHANNELS HELP
The ZEE Group, for instance, is contemplating launch of a new Hindi movie channel under the ZEE Cinema umbrella. Ad sales executives from the network are making presentations to advertisers and media buying agencies, apprising them of its plans for the new channel, persons in the know say.
Apart from news channels, Hindi movie channels have the maximum advertising per hour of programming. This ranges between 20-22 minutes an hour while Hindi general entertainment channels have about 14-16 minutes of ads an hour.
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Also, the ad rates per 10 seconds of movie and news channels are a fraction of GECs. Hence, a new movie channel will help maintain ad volumes within a network.
News broadcasters have tried tackling it differently so far. They have appealed against the Telecom Regulatory Authority of India's (Trai's) ruling to cap advertising time on television channels to 12 minutes an hour to declutter TV content.
On an average, broadcasters derive nearly 60-70 per cent of their revenue from advertising. The balance comes from subscriptions, unlike overseas markets where subscription revenues are more. Following the appeal, the Telecom Disputes Settlement & Appellate Tribunal (TDSAT) has asked the broadcasting regulator to respond in two weeks.
Ad rates across TV channels have already begun to climb, in anticipation of Trai's ruling, in the last two weeks, after remaining stagnant for much of the first half of this calendar year (as earlier reported on this page). The increase has been to the tune of 8-10 per cent, with media buyers expecting rates to peak at about 25-30 per cent in October. But, broadcasters are acutely aware of advertisers' resistance to higher ad rates during the slowdown. With limited options in rate increase, launching new channels could be a better bet, experts say.
Executives at ZEE Entertainment Enterprises Ltd (ZEEL), the company within the ZEE group that manages the entertainment business, denied they were launching a new Hindi movie channel when contacted. But persons privy to details say the group has been working at a fever pitch to get the channel up and running in the next two months.
ZEEL will not be the only broadcaster to go down that road. Speculation is rife that the STAR Group is also mulling a new movie channel under the STAR Gold banner. But a STAR India spokesperson denied this piece of news describing it as rumour.
Media buyers, however, say that the Rupert-Murdoch-controlled network has been giving them indications of a possible launch for some time now. "It is a question of when STAR decides to blink," says a senior media planner with a top-ten media agency.
ZEEL has four Hindi movie channels - the flagship ZEE Cinema, ZEE Premiere, ZEE Classic and ZEE Action. Shailesh Kapoor, chief executive of media consultancy Ormax adds, "The Hindi movie genre tends to be title-driven. ZEEL already has a vast library of films, both current and old, which could be utilised appropriately across its bouquet of movie channels. The new movie channel is unlikely to compete with the flagship one. Instead, it will target peers from whom it could take away some share of revenue, thereby boosting ZEEL's overall revenue."
The channel, likely to go on air in the next two months, may target a growing viewership, especially in the north, of English and regional-language films dubbed in Hindi. "There is an appetite for these films," says Farokh Balsara, partner and media & entertainment industry leader for Europe, Middle East, India & Africa at Ernst & Young. That might help ZEEL keep new blockbuster titles, for which channels fight tooth and nail, for its flagship channel and keep up a differentiation for the new one without spending a lot.
A fifth channel, experts say, could strengthen the bouquet and keep viewers from going out of the network. However, a new channel in same genre also has a flipside. With every launch, fragmentation of audiences only grows, points out Abneesh Roy, associate director, research, Edelweiss. Broadcasters then, will have to be mindful of the trap of too many channels targeting one genre.
HOW WILL NEW CHANNELS HELP
- Movie channels depend on ad volumes as they have much lower rates than GECs
- The slowdown make its difficult to convince troubled advertisers to pay more; even then ad rates have increased by 8-10 per cent
- New channels will keep up the ad volumes of broadcasters
- ZEEL's vast movie library will be utilised across its channels
- The new channel is unlikely to compete with the flagship movie channel
- It may target demand for English and regional-language films dubbed in Hindi