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All eyes on the new ministers

The media and entertainment and broadcasting industries have their fingers crossed with the new appointments at the helm.

The content part of the media industry falls under I&B Ministry while the Ministry of Communications’ Department of Telecommunications is responsible for the distribution part.

Anurag Thakur, Minister of Information and Broadcasting was head of the BCCI, and has an insider’s views of the media and its functioning and his recent stint as the Minister of State for Finance gives him an unrivalled perspective of the space.

Dr L Murugan
Minister of State
Ministry of Information and Broadcasting

Ashwini Vaishnaw, Minister for IT, electronics and communications is a strong proponent of the role of entrepreneurship in fuelling the nation’s growth. Being an alumnus of IIT Kanpur and the Wharton School of Business of the University of Pennsylvania, USA gives great hope to the industry.

The TV broadcasters, print media companies, digital companies and radio operators are looking for changes that are long since overdue. One of the impact of the COVID-19 pandemic has been a drastic drop in advertising revenue. Production halt has resulted in unavailability of fresh content on TV. This has led to not just a financial crunch but put many broadcasters in an existential crisis. Broadcasters’ payments have been stuck with Bureau of Outreach & Communication and state government advertising agencies leading to serious cash flow problems.

The sector has been pushing for an infrastructure status, liberalized licensing regime, and a stable regulatory climate for quite some time now.

In April 2020, the Indian Broadcasting Foundation (IBF) had requested the government for a stimulus package to help tide over the crisis that the sector is facing due to the COVID-19 outbreak. In a letter to information and broadcasting minister, Prakash Javadekar, the IBF had listed 18 points, including an 18-month regulatory moratorium and a phased resumption of production activities.

The IBF had sought digital payments of subscription and advertising dues, an advisory to distribution players to release subscription payments till February-end and a waiver of processing fee and temporary live up-linking fee for live sporting events for one year from the resumption of normal business activities.

The broadcasters also want doubling of the time period to two years for operationalisation of new channels and waiver of the April-June carriage fee due to Prasar Bharati for free-to-air channels on the DD FreeDish platform.

A stimulus package from the government could help all broadcasters, especially the small businesses, to get back on track. The broadcasters also want tax relief.

The letter requested urgent processing of all pending refunds exceeding Rs 500,000; waiver from the first instalment of advance tax (was due on June 15) and no interest liability on the second instalment (due on September 15); deferment on payments of  payments of stamp duty up to 90 days from lifting of lockdown and a six-month extension on all existing stay of income tax demands.

The IBF has also sought reduction in GST rate on digital services and automatic refund of input credit.

In October 2020, the industry advertising revenues had received a major setback when the Mumbai police had busted a TRP scam (Television Rating Point) alleging TV news channels of paying viewers to manipulate viewership ratings. TRP is a metric used by TV channels to indicate the percentage of the target audience reached.

Mumbai cop Param Bir Singh on October 8 announced it had busted a scam to manipulate TRP ratings and boost advertising revenues by Republic TV and two Marathi channels, Box Cinema and Fakt Marathi. As per Mumbai Police, families, including those in slums, were paid Rs 400 to Rs 500 a month to keep the 3 channels switched on to manipulate the TRPs.

Broadcast Audience Research Council (BARC) gave the contract to install 1,800 barometers in Mumbai to monitor TRPs to Hansa Research. Hansa filed a police complaint against some ex-employees who misused data on households where TRP monitoring systems were installed. Subsequently BARC’s former CEO Partho Dasgupta, former COO Ramil Ramgarhia and a couple of other people were arrested.

Some other issues that need redressal include ambiguities for the media industry in the new IT Rules 2021, TRAI’s attempt to regulate the pricing of channels, the industry being under the aegis of two ministries, I&B and Telecom.

Some responses

Karan Taurani
SVP–Research Analyst (Media, Internet & Consumer Discretionary)
Elara Capital

“The Minister’s top priority will remain on the regulation part. There’s too much uncertainty right now in terms of the entire regulatory aspect on the OTT & social media side. OTT has come up with some self-regulatory guidelines but apparently, more clarity needs to come on how they will be implemented. There may also be some kind of penalty announced if the set guidelines are flouted. As for social media, with the appointment of a redressal officer and tracking the origination of the message, clarity on how this will be implemented may also be seen soon.”

Avinash Pandey
CEO
APB News Network

“The industry is over-regulated currently and priority must be given to make it light-touch regulated and help the industry grow to take up emerging challenges. Traditional players of media, if helped by I&B, can further save the country from the impact of fake news. The Minister should look at helping the industry perform better in the pay market and liberate several categories for advertising, like the ones practiced in Europe and North America. This will help TV channels compete with OTT, expand advertising revenue market and make their economy workable.”

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