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Regional TV heats up as biggies beam in

Hindi general entertainment space loses sheen

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MUMBAI: The regional television market in India is poised for a quantum leap with the entry of conglomerates and a bigger-than-expected spurt in advertising revenue.
Experts believe the regional markets are still to be tapped to their fullest potential since their share of the total TV advertising revenues is only 25% compared with their viewership share of 37%.

The major regional markets are Tamil, Telugu, Kannada, Malayalam, Bengali and Marathi, in that order.

A recent report by Citi Investment Research put the value of these markets at around Rs 2,100 crore, with the Tamil market alone worth nearly a third of that. The report, co-authored by Surendra Goyal, Aditya Mathur and Jason Brueschke, said many corporates had focused on these markets in recent years because of the opportunity they offered. “In most cases, this has also resulted in expansion of the market opportunity as competition raises the quality of content being broadcast,” the report added.

The television audience measurement (TAM) ratings of the Kannada space have gone up by 11% after Zee Kannada was launched in mid-2006, indicating expansion of the market, according to the report.

Lately, Zee Network and Star Network have attempted to strengthen their regional presence. (The Zee Group is half-owner of Diligent Media Corporation, which publishes DNA) Zee Network recently entered the Tamil market with Zee Tamizh and Star Network launched Star Pravah and Star Jalsa, its Marathi and Bengali channels, respectively. The report added that Zee News, the leader in the Bengali and Marathi space, had made good inroads in Telugu and Kannada, achieving a market share of 10% in each.

Anand Shah, analyst, Angel Broking, said regional channels were seeing corporatisation in a big way. “Conglomerates such as Zee and Star have increased their focus on regional channels and even the advertisers are finding it more viable to advertise here.”
Shah also said that regional channels were more immune to a slowdown since advertisers look for niche, targeted advertising through them.

An analyst with a broking firm, requesting anonymity, said, though the Tamil market already had a good amount of penetration, there was a lot of potential in other languages. “The difference between the ad rates on a Hindi channel and on another language channel is falling, a sign of the scope offered by regional channels,” he said.
The ad rates on a regional general entertainment channel (GEC) are about one-tenth the rates on a Hindi GEC.

According to the analyst, the Tamil market is quite different from other markets in that on-ground distribution in Tamil Nadu is difficult since most channels are affiliated to one political party or another.

Another analyst said one couldn’t make inroads into the Tamil market as the Sun TV Network was strongly entrenched there. “But there are no clear winners in the Telugu market and it is extremely ripe for consolidation,” he said. He added that Bengali had the most potential among the regional markets.

Some media observers believe that reports of a rapprochement between the Marans, the owning family of the Sun TV Network, and chief minister M Karunanidhi have put paid to rivals’ hopes of a decline in the dominance of the group.

There is also a perception that markets like Gujarati, Bengali and Marathi offer more scope to media groups than the southern markets. One reason for that could be the fact that Sun has a strong distribution network across all the four southern states and can benefit from cross-use of content.

An analyst said corporates should now look to consolidate rather than launch channels. “It is becoming highly unviable to launch channels. Running a GEC costs much more than running a news channel,” he said.


 

 

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