Covid-19’s impact on media has been mixed so far. While we saw some consolidation happening in print, TV, and digital, we also saw new opportunities emerging and newer ways to mitigate risks.
In terms of opportunity, the glimpse of it was seen on March 24, in the Prime Minister Narendra Modi’s address to the nation, announcing the 21-day lockdown was the biggest single event on TV so far. 197 million people saw the telecast on TV, this is higher than the most viewed IPL match (137 million viewers). Challenge was to ensure how to monetize such a proposition.
A recent research report highlights, online will continue to grow faster than ever due to supply chain leverage, which is going to be next big thing when it comes to the M&E sector driving subscription revenues. Linear media will continue to be the biggest beneficiary from advertising revenue, OTT is already a new star in making. OTT opportunity is bigger, but challenge remains in terms of monetizing the same. Another big trend is going to be more of convergence, which is a mix of linear and digital.
The current crisis has lead to decline in AdEx, not only in print, but also TV and digital. Though broadcasters have done their bit in terms of recalibrating the deals to suit to advertisers, but the entire growth in viewership has gone unmonetized leading to loss of opportunity. We need to rebuild our business on robust models, which are shock-proof to such risks by looking out for alternative revenue models. We learn from all challenges, so we shall come out of this much stronger than ever.
SWOT, which is my perspective when Covid-19 resurfaced–strength: only form of entertainment, so growth in viewership in both linear and digital; news programming critical to keep citizens appraised; and low-cost of subscription in Indian market versus western market, helps in easy access to premium content. Weakness: subdued advertising impacted smooth operations due to low business sentiments; content unavailability due to lockdown; loss of revenues due to no sports activity; and monetization issues from sales perspective due to immobility. Opportunities: consolidation in operations, in fact we saw couple of big names coming together to consolidate their position due to current market scenario, leading to synergies in future; work-from-home leads to saving of expensive real estate and rationalizing the manpower also adds as opportunity; and strong rise in OTT/digital platforms, creating newer shorter supply chain, leading to more margins for content creators, example here is Bollywood selling titles to OTT, which helps them saving on money spent on distribution. Threat: dependency on ad revenues; cost structures of standalone networks leads to financial crunch and operations breakdown, leading to job losses; and loss of revenues from certain categories due to Covid-19, leads to disrupting overall trajectory.
Throughout the existence of business, threat of piracy continued to harm the business profitability, be it movie business piracy, under reporting of subscribers base, etc. The impact of Covid-19 is seen across businesses, some have managed to mitigate that risk, like in case of Bollywood we saw OTT direct releases helped them salvage the situation but in cases like print digital versions going beyond paywalls, the verdict is yet to come out in terms of how well readers take it. A business needs to be agile enough to either pivot or else it will perish during tough times. Want to share one of the nice articles I read: The Bridge on The River Choluteca, which is one of the longest and strongest bridges constructed in Central America to withstand any powerful forces of nature. It was so powerful that when flooding happened in late 90s, the flood water after rising to certain level changed its course due to strength of the bridge and it permanently changed the course of the river and now it has became a bridge over nothing. Choluteca Bridge is used as metaphor for focussing too much on problem and finding the best solution, forgetting at times that there is possibility that problem itself might change. So crux of this is, in these challenging time, we need to be agile enough to pivot our course to rise and shine.