Author: Farah Bookwala Vhora

Why the coronavirus pandemic calls for moral introspection

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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In times of turmoil, when universal human suffering reaches our doorstep, we begin to blame “others” for our misery. Today, the world at large blames China’s unhealthy food habits for serving as a breeding ground for the coronavirus pandemic. In individual countries where the COVID-19 has claimed large numbers and brought healthcare systems to their knees, citizens are blaming governments for their lack of foresight. Then again, governments are blaming citizens for not following public orders to avoid gatherings and self-isolate. And it goes on. That’s natural; its human tendency to find somebody to blame when we find ourselves incapacitated by the situation, helpless and desperate.

Then again, it’s in times like these that we need to morally introspect on why we got here. I’ve been doing a fair amount of reading and quite agree that this pandemic is a way of the Earth saying she has had enough of years of exploitation and excesses and needs restoring. Then again, I see this through another moral lens. You see, the pandemic is a counterstrike to our collective human consciousness that has been corrupted by indifference and culpability in sufferings across the world.

We looked through the papers and sighed as we saw young children in Yemen reduced to bones by hunger and famine. We indulged in ineffectual dinner table conversations on the inexplicable human tragedy in Syria, where children froze to death in brutal winter conditions. We lamented on the persecution of Rohingya Muslims, shaken by images of capsized boats and floating bodies. Yet we, as a collective human race, did nothing. We allowed governments and regimes to unleash so much human suffering on people who were not “among us” because it didn’t affect our lives — our careers, our children, our travel plans, our lifestyles. And that’s why we are here today, because we allowed our moral compass to fail us.

Our collective humanity did not rise to the occasion and that’s why we need an awakening. A Whatsapp forward rightly said – next time you see people fighting for the last roll of toilet paper, do know what it feels like to be a refugee. We are all refugees today, even those in modern nations that claim superiority over the rest of the world. Friends in the UK say supermarkets aisles are empty and online shopping orders have a wait list of more than a month. That’s how a refugee feels when he is denied access to basic essentials. We are all scrambling to seek refuge from a pathogen that we cannot see. That’s what it feels like to run for shelter from military targets that can strike from any quarter. We are denied visas to come home and see our families. That’s how it feels to be separated in war from children and mothers and fathers. We can no longer participate in social gatherings. That is what it feels like to lose community and culture. We now know what is like to live in a perpetual state of fear and paranoia.

The next few months will prove to be the real litmus test of where societies really stand, on a moral plane, as economies plunge, jobs are lost and civil unrest takes its toll. Now we’ll know the real price of allowing governments to meddle in the affairs of other countries, expanding military/ defence budgets to issue state-sponsored war to plunder their resources, for not doing enough to stop genocide of minorities and the human cost involved when our own economies are battered.

The consequences of the times to come can be brutal but are inevitable. Now we must spend our time in self-isolation seeking forgiveness for the collective human fallacy that we are part of. Of turning away. Of not caring enough. Of not doing enough.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

In crowdfunding platforms, a surge in fundraisers for children needing urgent liver transplants

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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This story began with a contribution and then an observation. Last month, I made a donation towards a child suffering from end-stage liver disease on a leading crowdfunding platform. I was soon inundated with emails and online adverts from various platforms seeking contributions for children suffering from terminal illnesses.

What stood out in these messages was the high incidence of liver-related cases. It seemed to me one in three campaigns were for infants or children from poor families who needed a liver transplant to survive. The imagery was disconcerting: infants lying frugally on hospital beds with swollen tummies and yellowed eyes; inconsolable parents pleading to save their child’s life through a generous hand-out.

Young lives crushed

I was both disturbed and piqued. Why do so many children suffer from end-stage liver disease so early on in their lives? How endemic is this problem? I knocked on the doors of leading crowdfunding platforms, Milaap, Ketto and ImpactGuru, and was taken aback by the magnitude of the issue. End-stage liver disease featured among the top three illnesses among children raising funds through their platforms.

Executives of Bengaluru-based Milaap, South Asia’s largest crowdfunding platform, say paediatric liver ailments account for the largest share of medical fundraisers for children supported by the platform. Data provided by Milaap says it has supported 12,000 medical fundraisers for children (0-18 years) to date, which have altogether raised more than Rs 155 crore. Of these, nearly 1,500 fundraisers have been for children with liver-related ailments, which have raised nearly Rs 35 crore. Milaap claims it has directly or indirectly aided over 50 percent of paediatric liver transplants performed in the country till date.

For Mumbai-based platform Ketto, paediatric liver ailments have steadfastly accounted for 20 percent of all the medical fundraisers for children over the past three years. A fourth of these children hailed from Below Poverty Line (BPL) families. Mumbai-based ImpactGuru has observed fewer than 100 cases of children with terminal illnesses each year. Of these, 20 percent are of children with liver-related ailments with most hailing from BPL/lower socio-economic backgrounds. CNBC-TV18.com could not independently verify the data provided by the platforms.

The emergence of children with failing livers on crowdfunding platforms subsets the larger problem the country faces. According to the latest World Health Organisation data published in 2017, liver diseases caused 259,749 deaths, translating to nearly 3 percent of total deaths in the country. This makes it the ninth leading cause of death in India, says The Pravin Agarwal Foundation (TPAF), a not-for-profit that supports paediatric liver transplants in India, in a blog post titled ‘Creating an affordable paediatric liver transplant ecosystem’, which was published in June.

Numbers quoted by TPAF on paediatric liver mortality are equally grim. Pediatric disease is one of the least recognised causes of mortality in India. Nearly 3,000 children need a liver transplant every year but only one in 20 gets access to it. This means a staggering 92 percent of children in need of a transplant do not receive it due to a variety of reasons including dearth of organ donors, lack of an organised system for liver procurement, poor financial condition of families and lack of awareness/illiteracy.

The many causes of liver-ailments in children

Liver diseases among children can have various causes. Children may either be born with a genetic disease (biliary atresia), may develop a metabolic disorder (Wilson disease) or may contract an infection in the early part of their infancy (hepatitis). In the case of biliary atresia, a child is born with blocked or damaged bile ducts which hinder the flow of bile into the intestines, causing it to accumulate in the liver and damage it. In metabolic liver diseases like Wilson disease, the body is unable to process copper from food and the copper builds up in the liver. Children may also contract chronic viral hepatitis which causes the liver to swell and encourages scar tissue to form. While medication is used to manage these ailments in the early part of treatment, a liver transplant is the only option for long-term survival.

Given the alarming number of cases coming to light, a pertinent question is: Has the incidence of paediatric liver-ailments increased over the years? Doctors do not think so. “It’s difficult to say whether incidences have increased but surely diagnosis has increased,” said Dr Swapnil Sharma, liver transplant and hepatobiliary surgeon at Fortis Hospital in Mulund, Mumbai.

“Improved awareness levels, early referral by primary physicians and scientific advancement have helped in increasing diagnosis of liver ailments in children. Today, medical science has evolved with newer imaging and tissue analysis procedures available, such as HIDA scans,” he said. A HIDA scan, also called cholescintigraphy or hepatobiliary scintigraphy, is an imaging test used to view the liver, gallbladder, bile ducts, and small intestine by injecting a radioactive tracer into a person’s veins.

Dr Sonal Asthana, senior consultant – hepato pancreato biliary and liver transplant surgeon at Aster CMI Hospital, Bengaluru, said: “The detection for liver problems is now more effective than before. Their identification is better. The referral channel for children is better today. Children are being referred more appropriately for transplants. So we cannot really say there is an increase in incidence; we are probably getting better at identifying these patients.”

The economic background of these children is another point of observation. A large number of children raising funds through crowdfunding platforms hail from poor families where mothers are homemakers and fathers tend to be farmers, daily wage workers or in low-paid blue-collared jobs. That raises the question: Are children from economically disadvantaged sections of society more susceptible to compromised livers at birth or to falling prey to liver diseases?

“Yes. This is for a number of reasons. Children from certain groups of communities, for example, tribal communities, do have higher incidence of certain particular genetic disorders, and that is well-known and well-studied. Secondly, children from poorer families are more likely to come from malnourished mothers, who have prematurity and several of the attendant problems. So these children not only have a higher incidence of some of these diseases, but they present to us in a much worse fashion with diseases, because they are combined with other conditions like anaemia that go hand-in-hand with poverty. So most of these kids come to us very late, if at all,” explained Dr Asthana.

“Children from all economic backgrounds suffer from liver diseases. The difference lies in the nature of illness. A few conditions such as infections e.g. Hepatitis A, E, liver abscess are more commonly seen in children with poor sanitation facilities.  Children from poor socio-economic backgrounds also suffer from liver ailments such as infections and fatty liver due to malnutrition. Some perinatal disorders like biliary atresia may be caused by as yet unidentified factors including probable infections that may be commoner in poor socioeconomic strata. Those from affluent families suffer from obesity and related liver issues. However, there is no strict distinction.” says Dr Smita Malhotra, pediatric gastroenterologist, Apollo Hospitals, Delhi.

“Kids from impoverished backgrounds are the ones who are affected the most, as they are exposed to unhygienic conditions, leading them to fall prey to liver ailments. The lack of basic sanitation, good drinking water and healthy food supply is the main cause for the rising number of liver failure cases amongst children,” says Varun Sheth, co-founder and CEO, Ketto.

‘Overwhelming challenges to the paediatric liver ecosystem’

The paediatric liver ecosystem is highly underrepresented in India, despite the urgency the disease demands.

A liver transplant is a highly time-bound procedure, more so in babies and children who have lower immunity than adults. According to the Directorate General of Health Services, of the nearly 260,000 fatalities caused by liver diseases, 200,000 can be attributed directly to cases of liver failure and that on-time administration of a liver transplant could have saved an astonishing 10-15 percent of these lives.

Unfortunately, the poor status of families and lack of awareness or outright illiteracy means they are unable to access the right treatment options in a quick manner. Many families live in villages or towns with either no medical facilities or are dependent on basic community health care centres for the first line of treatment, where liver-related symptoms are often misdiagnosed as pre-natal jaundice. Months of incorrect medication and treatments cost patients their livers, which are most often decompensated by the time they approach tertiary healthcare centres in larger cities. The time lost can prove to be fatal in many cases.

Secondly, despite transplants costs in India being the lowest in the world, it is still well beyond the reach of Indian middle-class families. Among transplants of critical organs such as kidney, liver and heart, a liver transplant is the most expensive, with costs ranging between Rs.15-30 lakh. The high cost is attributable to a significant demand-supply mismatch on two accounts: between donors and recipients and super-speciality doctors and hospitals equipped to perform liver transplants.

As pointed out in the blog penned by the TPAF, a lion’s share of paediatric liver transplants is facilitated by a liver donation from a living, adult donor. While in many cases the living donor is the child’s mother or father, convincing unrelated adults to donate a part of their liver is very challenging. The lack of awareness around the concept of a living donor proves to be a big setback with misconceptions aplenty – prospects often think they would be handicapped or diseased after donating a part of their liver.

Finding a match from a deceased donor is equally difficult. “The awareness and attitude towards paediatric liver donation continue to be poor. While medical science allows the liver of a recently deceased person to be transplanted, convincing a prospect’s family to volunteer for donation is difficult. This results in a poor deceased organ donation rate. Combining the first and the second factor leads to a high imbalance between the demand and supply of paediatric livers,” reads the blog.

The dearth of doctors qualified to perform liver transplants and lack of hospitals is another factor leading to the high cost. “In Mumbai, barely 4-5 hospitals have the licence to perform liver transplants. While many hospitals may be state-of-the-art, there is a huge scarcity of super-speciality doctors and teams qualified to perform paediatric liver transplants, which is a highly complicated surgery. And this is the situation in India’s biggest and most popular city, so one can imagine the story in a tier-2 city,” explained Sandeep Tripathy, Senior VP – Business Development, ImpactGuru.com

“Even where doctors are available, hospitals may not be able to afford them or they may not fit into their revenue criteria. Most hospitals operate on 10-15 percent EBIDTA margins and their cash flows are often stretched, disincentivising them to offer transplant surgeries,” said Sheth of Ketto.

As Tripathy pointed out, a liver transplant is a highly complex surgery, involving two surgeries (extracting the liver from donor and transplanting into recipient) and the high post-operative costs included in the liver transplant budget significantly inflates the costs borne by affected families. Most families do not have insurance coverage and those who do may find their covers insufficient to take care of the entire cost of the transplant and beyond.

More so, the government’s ambitious national health mission programme, Ayushman Bharat, which aims at providing Rs 5 lakh medical insurance to 10 crore Indians, covers chemotherapy and radiation costs for cancer patients but does not cover organ transplant. While news reports suggest the government is contemplating including organ transplant in the second phase of the program, experts say there are miles to go before it becomes a reality.

Together, these factors make liver transplants well beyond the reach of those who require it.

Crowdfunding comes to the rescue

The emergence of crowdfunding as a platform to raise funds for emergency or tertiary healthcare has come as a ray of hope to families crushed under the burden of hospital bills. In most cases, crowdfunding is not the only source of funding, and is often the last resort after exhausting all other avenues. Doctors say crowdfunding platforms produce better results than NGOs or charitable trusts, with campaigns for children raising at least 70-80 percent of the expected amount, if not more.

“Charitable trusts have to distribute their funds equitably among different causes or beneficiaries and therefore, the amounts are capped. Crowdfunding campaigns focus exclusively on the patient and rely on the generosity of the general public. In the case of young children, people tend to be more generous and therefore, the amounts raised have been handsome,” said Dr Somnath Chattopathyay, consultant and head of hepatobiliary surgery and liver transplant at Kokilaben Dhirubhai Ambani Hospital in Mumbai.

Take the case of six-month-old Adrika Das who was diagnosed with a rare genetic liver disorder Prothrombotic Disorder (Protein C Disorder) after birth. Adrika suffered from necrosis on various body parts and was referred to Rela Institute in Chennai for a liver transplant. It is here that her father, Dipanjan, a government employee, was approached by a representative from Milaap. The campaign was kick-started by Milaap and widely shared by Dipanjan and his family. The campaign raised an astounding sum of Rs 33 lakh overnight, which not only covered Adrika’s liver transplant but also a follow-up surgery to remove part of her intestine.

“I have no words to describe how grateful I am to Milaap. Raising Rs 33 lakh was beyond my imagination. The power of crowdfunding is immense,” said Dipanjan.

Another example is that of one-year-old Piyush who was born with Biliary Atresia. Piyush, abandoned by his father after birth, was required to undergo a liver transplant at the earliest. Given the high cost, the family opted for crowdfunding on ImpactGuru. Within 24 hours, the campaign raised Rs 21.91 lakh, helping Piyush undergo a liver transplant At Fortis Hospital, Mulund. Piyush’s grandmother turned out to be a match, and 30 percent of her liver was transplanted to save Piyush.

Pooja Sarkar, 21, Piyush’s aunt said: “The treating doctor referred us to ImpactGuru and the team seamlessly set up a campaign for Piyush. We would have never been able to raise such a significant sum on our own.”

Reasons why campaigns run for children tend to be more successful are aplenty. One, children not only evoke unparalleled feelings of sympathy and generosity, but the sense of gratification of saving a child, who has his/her entire life ahead of him, is immense. The second is the high success rates that paediatric transplants enjoy. Anoj Viswanathan, president and co-founder, Milaap, said: “Crowdfunding opens up an alternate financing option for such medical emergencies, and liver transplants, in particular, are a kind of treatment with higher success rates, particularly among children. Urgency is one of the key psychological triggers that cause people to donate, needs like these are more likely to receive support online.”

Pediatric liver transplants enjoy high success rates with one year post-surgery survival rate at 95 percent, 10-year post-surgery survival rate at 85 percent and 20-year post-surgery rate at 80 percent. This data, corroborated by several doctors, is true for pan-India.

Building the paediatric liver ecosystem

While crowdfunding is becoming an important channel for those who fall out of the entitlement bracket, it certainly isn’t the only intervention that is required. Doctors say it is critical that the costs of liver transplants, including post-operative costs, are brought down.

“Crowdfunding platforms, with all respect are a bit of a double-edged sword, because it relies on an emotional connect with online communities to raise money for a treatment that would not ordinarily be within the reach of a particular family. So it’s extremely good when it comes to acute problems, for example when a child needs chemotherapy, or if somebody has an accident. But when it comes to something as complex as transplantation, we need to be sure that we have an on-going mechanism of supporting families for on-going expenses because transplantation is not a one-time expense. It involves a fairly high upfront expense, but it also involves lifelong care and medication for a child,” explained Dr Asthana.

“The high expenses are not a reflection on crowdfunding itself, because it is obviously a very valuable tool, but it is more of a reflection on our healthcare system, where we aren’t able to put down safeguards for long-term care for these children. So the best way is to marry something like crowdfunding with an on-going government scheme which would provide for on-going care of children undergoing treatment. So I think crowdfunding is just part of the answer, not the entire answer,” he said.

Post-liver transplant management requires life-long screening tests and administration of steroids and immunosuppressants (to prevent liver rejection by the body) and these post-operative expenses are difficult to bear for most families. Doctors concur that the government should arrange for free blood tests and subsidised or free transplants for BPL families, as the Tamil Nadu government does.

Piyush, who underwent liver transplant at Fortis Hospital, is an example. Said Piyush’s aunt Pooja, “While crowdfunding helped us with the expenses of the operation, managing the post-operative expenses is challenging. Each month, we incur an expense of Rs 20,000 on Piyush’s blood tests and medication. We rely entirely on our personal savings.”

Doctors said it is imperative that hospitals offer discounted packages for transplant cases, especially in cases where crowdfunding is being sought to raise funds. “Hospitals must voluntarily agree to a lower share of profit by agreeing to discount packages by 10-15 percent to support these patients. It must be treated as part of their social responsibility,” said Dr Smita Malhotra of Apollo Hospitals.

Ketto chief Varun Sheth believes it is important for hospitals and foundations to work together to bring down transplant costs. Sheth explains the concept of “group buying”, citing the example of the Transplants-Help the Poor Foundation (THPF) which works with Apollo Hospitals. Under this, THPF supports a large volume of patients to get a discounted cost per transplant from the hospital. Sheth also stresses on the importance of reducing taxes on medical devices and fixing prices on essential drugs to lower costs.

Not all seem convinced by efforts to bring down healthcare costs. “These institutions are trying their bit to reduce liver transplant costs by trying to negotiate the cost of a liver transplant with hospitals. They aim to aggregate the supply of people who want transplants for children and therefore, try to negotiate bulk rates with hospitals. It’s a great thought process, wonderful intervention. But having worked with thousands of hospitals across the country and having personally funded through the platform 6000+ patients, I can tell you bringing healthcare costs down is a myth,” said Piyush Jain, co-founder and CEO, ImpactGuru.

“Generally speaking, costs will keep increasing; because what is the driver of the costs? The doctors’ fee, cost of materials and machine and technology; none of these go down. But what can be done is thoughtful thinking on how to arrange the financing required for these emergencies. And that is where most of the effort needs to go into,” he said.

Jain pointed out that Corporate Social Responsibility (CSR) is one such area where strategic interventions are required. He says, “India is spending $2 billion of CSR funds on so many interventions with non-profits. Whatever way it is being spent, it can be more efficient. The vast majority of funds go into preventive healthcare, because it allows companies to show good, strong numbers. For example, a camp set up to offer free eye checkup to 5 lakh people is equivalent to the cost of one liver transplant. More funds need to be channelised into curative healthcare to make it more affordable for the masses.”

CSR funds can also play a pivotal role where crowdfunding efforts do not succeed. “CSR funds can provide a matching fund or backstop; if crowdfunding cannot raise a certain amount of money within a certain period, CSR funds can be deployed,” explained Jain.

Another important area to address is the shortage of multi-speciality hospitals and doctors. Dr Swapnil Sharma of Fortis Hospital said: “Every state must set up government or semi-government aided liver speciality centres, an example being the Institute of Liver and Biliary Sciences (ILBS), where liver patients from the state can be referred. These hospitals would perform transplants at a much lower cost than private hospitals and would attract top speciality doctors.

“That said, several multi-speciality government hospitals are facing a shortage of super-speciality doctors due to the low pay they offer. If this is corrected, it will incentivise doctors to serve government hospitals,” he said.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Zee5 aims to achieve 15 million daily users in next six months, says CEO Tarun Katial

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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In an exclusive chat with CNBCTV18.com, Zee5’s CEO Tarun Katial speaks about reaching 15 million users by next year, their attempts to hyper-personalize the app to cater to individual needs, how gamification of their popular shows and characters will be the real game-changer and why the idea of an independent body for self-regulation of content doesn’t appeal to Zee5.

Let’s begin with Zee5 and its journey. Where is the platform today in terms of its reach and presence? What is the larger vision for Zee5?

Tarun Katial: I think it’s been a great journey. We’ve been able to reach 8.9 million daily active users, and over 80 million monthly actives and a huge watch time. What we’ve been able to capitalise is the data and the addressable universe that got created once 4G came into the country. When the (data) prices came down, we needed to make sure that we were able to capture, not just the length and breadth of users, but also for users, the device ecosystem, the data ecosystem, the content ecosystem, the user experience ecosystem; all of it. So it’s about getting to the KaiOS feature phones on one end and the smart TV on the other end. And all the sub-hundred dollars Chinese phones to Android phones to iOS phones to the entry level smart TVs in between. Then, to be able to deliver video on a very adaptive bitrate through slow 3G (connections), slow 4G and all types of broadband.

So the challenge has been largely technological as opposed to content creation…

Tarun Katial: Yes. As you know, we have the 3V strategy – Vernacular, Video and Voice. Vernacular is very big for us. Our User Interface (UI) and User Experience (UX) support 12 languages. So (when) you get into our app, the first thing we ask you is what’s your language, because that’s the key for us to be able to reach out to those many languages, both in display and content.

Display is the tougher one to build. We had the content through our web of Zee language channels. But building the UI in those many languages, navigating consumers in so many languages, that was the tough part.

Now coming to voice search – Indian keypads don’t support so many languages, so while you have the content, you have the UI in that language, consumers won’t be able to consume it. So it was important for us to be able to install the voice search feature which can discover content that quickly and that easily.

Besides that, we’ve also build a robust AVoD (Advertising Video-on-Demand) and SVoD (Subscription Video-on-Demand) strategy. We made some very big investments on the AVoD side in building the ad suite. We needed to do all of this because beyond the big tech, very few Indian companies had actually done any work on ad tech. Ad tech is run by big tech companies in India – Google Facebook and Twitter – and if we want to compete in the ad space we knew that we needed to build our ad suite.

We have also embarked on the journey of building the self-serve bidding model where advertisers can book their own advertising slots, bid for advertising slots, the pricing is on a bidding model and optimise the advertisement themselves on an optimisation engine.

You’ve got about 8.9 million daily active users as of today. What’s the user base you want to get to?

Tarun Katial: We want to get to a minimum of 15 million daily active users. But for that we need to get watch time up. We need to get more and more hyper-personalised. We’ve launched a new recommendation engine and our attempt is that between auto-curation and hyper-personalisation, we should be able to give you what you would like as a segment of one. The more we can do that, the more your app will look different from mine or somebody else’s and our attempt is to really get there. From the time you launch your IP, we are going to be able to give you languages of your state, your UI and UX will get customised to that language and the content you will watch will be hyper-personalised in terms of the kind of recommendations that come to you. Because we have so many data management platforms, even when a user logs in and has low consumption, we’ve understood where he/she comes from and is likely to watch. We can even do cold-start recommendations so that even at the entry level, the app can show content that will excite him/her to come back to the platform.

Apart from the vernacular interface and voice recognition features, what are the other technological interjections to hyperpersonalise the UI and UX?

Tarun Katial: So one of the big things is video encoding and transcoding. To be able to serve this device ecosystem, we needed to be backed up by different kind of encoding technology and intuitively be able to offer that to users. So when you launch your app in a slow 3G environment on a slow phone – a sub-hundred dollar phone – and your memory is low, we know what kind of video, what MPEG, should be delivered to you, what Content Delivery Network (CDN) to use behind it. So the entire content pipeline that delivers the content needs to be intuitive. It can’t be one size fits all. We are making it hyper-personalised.

Given your focus on hyperpersonalisation, how soon do you think you can get to 15 million daily active users?

Tarun Katial: I would think about six months. The way we are investing behind technology, I think we can progressively make that leap. We’ve made a significant investment behind our technology teams. It’s a significant percentage of the total cost and we’ve upped that technology investment. We’ve been able to optimise costs on manpower because we are automating, but we are putting all of that behind technology.

We’re doing a lot of automation today. We’ve just finished piloting with the tool from Microsoft Azure for self-editing. My 25-minute episode can be converted into a 7-minute episode through machine learning without having to edit it.

The machine decides what scenes need to be picked up and creates a short form of the long form video.

Most of our app today is fully curated through artificial intelligence and machine learning. We don’t do any manual curation anymore. So no human decides what story or show will go up where and how.

We are also moving into being able to do packaging of content on the fly. So we’re working with another Israeli product that will be able to create a pack for you, which is significantly different from the current packs which are standard packs; I can personalize packs for you.

At your last investor meeting, Puneet Goenka had spoken about creating lighter user packs. What is on the anvil?

Tarun Katial: I think our effort is to see what we can package within that and what price point we want to be at. So we’re testing two or three packs. These could be regional, hyper-local, hyper-personalised packs, we are looking at what kind of technology can allow us to do this in real time and I think we’re very close to it.

You also announced plans to launch a mobile-only plan, much like Netflix. When do we see that happen and how will it play out commercially for Zee5?

Tarun Katial: We are close to it. Technology-wise we are ready, but we’re just evaluating the way we want to play this out. It may not be just be a mobile pack, it may be packaging of different content into different devices. There are multiple factors at play here, including the number of logins and concurrencies. We are throwing a lot of things in the air and deciding what combination works best.

Give us a sense of Zee5’s current revenues and growth rate. When can we expect the platform to break even operationally?

I think it’s working well. We’re seeing significant growth month-on-month, both on the AVoD and SVoD side. I think we’ve got some significant tailwinds on the B2C side; we’ve seen some significant movement on that and we’re very proud of that traction. I think today, outside of (Amazon) Prime, Zee5 possibly has the largest subscription base in the country. And Prime is not necessarily comparable because it includes shipping, shopping and is essentially an end-to-end retail company and video is just a small component of that.

As far as breaking even is concerned, I see ourselves being able to do that within 5 years.

On the content side, you have a partnership with ALTBalaji to co-create content that plays out on both platforms. Are you interested in tying up with other OTT platforms as well?

Tarun Katial: Yes we are. We are in talks with a couple of players as well as good production houses. Digital will require a regular supply of good quality content for the needle to move effectively in the large base of India and the addressable market.

You’re offering 12 Indian languages today and five foreign languages. How you’re looking at expanding that bouquet?

Tarun Katial: We want to do a little bit of more in India. We want do the Northeast. I think Assamese is an opportunity we want to tap into. One language we haven’t done enough in is Malayalam. We want to do more local original content in Malayalam. We want to do more content in Kannada. We’ve been very surprised to see the kind of off-take we saw in Kannada. We can see all of this come to play in the next six months.

At the moment, Zee5 is also investing heavily into franchises – spinoffs of your popular TV shows as well as direct-to-digital movies. What’s in the pipeline?

Tarun Katial: We will do a lot of it. We may create spin-offs for both old and new shows. Over 27 years, Zee has created some great IP. It’s lying in our treasury and we’re now discovering and recreating it. ‘Jamai Raja’ was an old show but it has done humongously well for us in its new version (‘Jamai 2.0’). We are also working on almost five such new shows which would come back in some form. Direct-to-digital has been another great space. We’ve done some great films like ‘Barot House’, ‘377’, ‘The Sholay Girl’, ‘Badnaam Gali’ and we’ve seen very good numbers on it.

What other segments are you getting into?

Tarun Katial: Kids’ content is a tough market to crack, and we will do two or three things. One, we will obviously acquire some of the content that’s available in the market, both in India as well as internationally. We also want to invest in some original IP. We have some very good IP from ZeeQ (ZeeQ was launched in 2012 and offers TV content for children between 4 and 14 years). For example, ‘Bandhbudh and Budbak’ was a very big show and there are several others. So we want to create some of these IPs in the long run.

We also want to do a certain amount of User Generated Content (UGC) for kids. We think that’s a big opportunity. We’ve had some great franchises in ‘Sa Re Ga Ma Pa L’il Champs’, ‘Dance India Dance Little Masters’.

Will you formulate children talent shows specifically for the OTT platform?

Tarun Katial: The talent space is a big space. It’s kind of unique. We will do an on-going challenge on the platform, and participants could eventually find themselves on the TV show.

The other space we want to leverage is content gamification. That’s a big space and we want to do 2-3 things. One, we want to gamify our platform with the original content and new content that comes on-board. What we’re trying to do through gamification is to let people play along, do specific shows for play-along. We’re in the midst of getting a low latency technology that allows us to do live gamification.

We are also gamifying all our TV shows together in one thread. Fantasy leagues as a concept is very popular in sports and is targeted more towards males. We are bringing a similar concept in a very different avatar of ‘Indian families’ to the viewers of these shows. So far TV channels have primarily done gamification for non-fiction shows like ‘Kaun Banega Crorepati’. Even on ZEE5, we have done gamification for our top non-fiction shows like ‘Saregamapa’, ‘DID’ and ‘Dadagiri’, which did very well in terms of impressions.  This is the first time we are planning a gamification for fiction shows.

So the ZEE5 Super Family will be the first and only gamification for fiction shows. These are shows which have completely involved audience and they love the characters. The idea of this gamification is to take that affinity to these shows and characters to another level, where you are virtually making a family with them and getting a chance to win exciting prizes. The idea of owning your favourite characters comes alive in this gamification. So popular Zee TV shows including ‘Kumkum Bhagya’, ‘Kundali Bhagya’ etc will be gamified. It’s a fairly interesting thing we are doing.

The industry is divided on the issue of instituting a two-tier mechanism under an independent body much like the Broadcasting Content Complaints Council (BCCC). As I understand, Zee5, Netflix, MX Player and ALTBalaji are not keen on an independent body. Why?

Tarun Katial: If a two-tier mechanism is going to tell me to pull content down without having a conversation or discussion, it’s a bit tough, right? That said, I think we will get there eventually, we first need to get the basics sorted. We can’t jump into it yet. Let the industry agree on a unified code for what is blasphemy, what is not child-friendly, get the age-appropriate classifications, get the entire regulation on grading content and all that done.

So, are you saying that will happen only when all the nearly 40 OTT players unify on the self-regulation code?

Tarun Katial: At least a significant number of them. We’ve already started. We have parental control, age grading, genre grading, all of it. And it’s just not about grading it, but it’s also about how you post that onto the front end. Do you want the grading to stay all through the video, what classification should we put or not, these are the details that we need to iron out first. All players, Netflix, Voot, ALTBalaji, MX players may it do it differently.

Do you feel that a body like BCCC is eventually going to lead to censorship? 

Tarun: I don’t think it’s going to become censorship because BCCC is also not about censorship. It’s, at some level, guidance for what you do right or wrong. But I do think that there is a difference between broadcast and OTT. In OTT, you look at the thumbnail and you decide to consume it. Then again, there are so many variables such as YouTube, which provides purely UGC content. So it’s not an apple-to-apples comparison either between platforms or between technologies of broadcast and OTT. So it is unfair to apply the standards of film or TV to OTT because they’re different technologies.

I still do believe there is a need for some amount of regulation. The industry needs to be responsible. People must think about where this goes for the Indian society.

So, I think we all need to come together to at least agree to the first level – get the tier one mechanism in place, see how it works, see how much  consumers and policy makers like it and then if it doesn’t work, we move to tier two.

I would find the need for tier two (mechanism) if I felt that I am not capable of addressing grievances through tier one. Zee5 has enough checks and balances to be able to deal with consumer complaints. At tier one itself, I believe we have (an equivalent to) a two-tier level mechanism, which is my own mechanism, to listen to people. We have a panel of people who look at all the complaints, a customer service team who gives feedback, who holds up the content team and we do make changes ourselves. We are very sensitive to our reputation management. We never want to be seen in a negative light. And for brands that’s extremely important today in the day and age of social transparency.

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Streaming platforms have allowed us to tell different stories or stories differently, says Zoya Akhtar

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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For filmmaker Zoya Akhtar, 2019 has been larger than life. The 46-year old director is riding on a high after her Netflix film Lust Stories earned an Emmy nomination, followed by the box office hit Gully Boy, a film about an underdog who makes it big in the world of rapping starring Ranveer Singh and Alia Bhatt, becoming the official entry from India for the Oscars 2020.

CNBC-TV18.com caught up with Akhtar on the sidelines of the MAMI Word to Screen Market 2019 in Mumbai to get her thoughts on the booming video streaming culture in India, making films for an evolving audience, and why regional works struggle to become successful on-screen adaptations.

Q. In 2019, you’ve broken the status quo not once but twice. On one hand, your Netflix series Lust Stories received an Emmys’ nomination. On the other, we’re seeing that more than a decade after a mainstream film like Lagaan made it to the Oscars, we have Gully Boy  winning an official entry.  What does that tell you about not just evolving tastes of Indian audiences but also the way Indian films and stories are being received worldwide?

Zoya: I think that suddenly there is a platform for our stories to be watched worldwide. I don’t think that space was available earlier. Now you have platforms that allow you to bring a formula, that allow you to tell different stories, and allow you to tell them differently, to use a different syntax. So, all of that is bound to find an audience somewhere on the other side. It’s a very, very good day to be in the film industry is all I can say.

Q. Sticking to Gully Boy and its journey to the Academy Awards, how did you go about making a mainstream film that will appeal to a larger audience while staying true to your vision? How much compromise did that involve?

Zoya: I think Gully Boy is like me. I’m born and bred in the Hindi film industry and I’ve got that commercial base, it’s in my bones; I grew up on commercial cinema. But at the same time, because my mother (former actor Honey Irani) was studying films and my dad (Lyricist Javed Akhtar) is a poet, and they come from very different disciplines, there was a lot of literature and poetry in the house. We watched a lot of foreign films. So, I think there was always been an indie vibe and I’ve worked only on independent films till ‘Dil Chahta Hai’. So Gully Boy is a mix of commercial and independent and I think it has a kind of tone that comes very naturally to me.

Q. How has the advent of the streaming culture changed the process of writing and directing for films? Does that impact the process of writing?

Zoya: I think is unbelievable. (When you write for platforms), you are liberated, you don’t have to pressure of the box office on your head, you don’t have censorship, you don’t have you don’t have to cast necessarily big stars so you have to cater roles for them; it’s liberating on many, many levels. You have no time bounds like TV where one episode has to be 22 minutes or 24 minutes; here one episode can be 25 minutes, the next one could be 30 minutes.

There’s so much world content that people are watching that their palate is slowly changing. Suddenly you put your show out, and your show is next to ‘Powder’ and that show is next to ‘Mad Men’. So you’re on a shelf with everyone and that way your audience will grow. You will consume and your work will be consumed.

Q. I’m essentially talking about big-cinema films going on Netflix and then having to compete with non-film content. Does that change you write for your films or does it put more pressure on you as a filmmaker?

Zoya: No. I think it’s actually fantastic. It’s actually not putting pressure, it’s actually taking pressure away.

 Q. As a director, how do the nuances of writing and directing a series differ from a film? 

Zoya: It’s different. On one level, it gives you a lot of time to develop character. So it’s a slow burn. You don’t need to go chop, chop, chop, get to the point. You can actually take the time to evolve a character, layer a character or peel a character.

I anyway have a problem containing my script, so for me, it’s natural to go long format. I like my arcs and I like people to come in and go out. But at the same time, from a two-hour narrative you have to look at an 8-hour narrative, and know that it connects and holds and the payoff that started here ends there.

Q. What kind of literary work are you looking out for at MAMI Word to Screen and beyond?

Zoya: You can always come and look for something specific, you can tell people like I’m looking in this genre, but I think you should be open. Because if you’re only specifically looking for a black and white dress, that’s all you be looking for. So if you go into a store, and you say I’m going to see whatever I like, your energy is much more open and things come to you.

Q. But most of your work has been about coming-of-age films, be it the Rock On!! franchise or Zindagi Naa Milegi Dobara, a genre in which you’ve done extremely well. So are there plans to dabble in new genres?

Zoya: I think I’ll take any genre and convert it into a coming-of–age genre film (laughs). I like it a lot.

Q. 2018 was the year of low-budget, strong-content films with the likes of Andhadhun, Stree, Tumhari Sulu doing very well at the box office. But in 2019, we’ve seen that despite the controversies and less-than-appealing reviews, Kabir Singh has become the highest grossing film overshadowing films like Article 15 and Uri. As a commercial filmmaker, how do you reckon with this kind of extremity, this kind of oscillation, in audience tastes?

Zoya: It’s fantastic because if it (audience tastes) only showed one thing, then only that film would be made and we don’t want that. We don’t want that one type of movie to be made. We want all types of movies to be made. So sometimes this is going to blow up and sometimes that’s going to blow up. Sometimes this is going to work, sometimes that will.

Q. Are you satisfied with the kind of talent pool that exists today in the film making fraternity?

Zoya: There’s always room for more talent. You can be satisfied but the tide’s going to turn. That’s the way it is. It’s evolution. I think we have very, very talented people in this industry and they’re all thriving. The game has been upped. So it’s good fun.

Q. There’s been a lot of talk about regional content/literature but the truth is there have been very conversions from regional literature that have become commercial successes. How challenging is it to make films for a mainstream audience that appeals to a wider set of audiences?

Zoya: I’m not keenly looking out for any particular regional work. You can say regional content has not been converted to Hindi cinema, but it’s been converted to other languages…

Q. But it isn’t catering to a wider audience that is available through Hindi cinema. Why?

Zoya: We don’t have access to those stories. If you don’t read in a particular language, that anyway negates that, you’re not looking for those titles then. Sometimes the adaptations to English aren’t great to read, so people don’t really read them. When you look at your pop culture, you look at your news magazines, they’re not really covering that. If there was some great work in Gujarati and if the mainstream media covered it, I would be interested. But if I don’t have access, it’s not going to. That’s what a platform like Word To Screen is doing. It’s taking people from the industry and it’s putting it with all these literary people, and it’s just bypassing everything in the middle. That’s the beauty of this.

Q. Corporatisation of Bollywood’s film studios and production houses have always been seen with an eye of scepticism. I want your frank view on the kind of impact—both good and bad —corporatisation has had on India’s filmmaking ecosystem.

Zoya: The good thing is that things have been streamlined, the money has been streamlined, the delivery dates have been streamlined. I mean, there are a lot of good things. I have to say I can’t complain because I’m very protected by my producers. I work with Ritesh (Sidhwani) and Farhan (Akhtar) and I’ve been protected from my first film. Not because I’m doing well now. It’s always been like that, they really protect their talent and creators. (Excel Entertainment is an Indian film production and distribution company, founded by Ritesh Sidhwani and Zoya’s brother and actor-director Farhan Akhtar,)

But having said that, I do know that sometimes people (production houses) do not really understand the nuance of it (creative process of filmmaking), they want things in a particular way because that is what the market is dictating. That’s what’s working right now, so let’s do everything that the market wants. But filmmaking is not a cookie cutter market. So there are pros and cons to everything you know.

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Hitting new boundaries: Brand IPL valued at Rs 47,500 crore, up 13.5% YoY

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Twelve seasons past, the Indian Premier League (IPL) continues to grow from strength to strength with the T20 format cricketing league valued at Rs 47,500 crore in 2019, up 13.5 percent over last year, according to the latest Duff & Phelps IPL Brand Valuation report.

The IPL ecosystem was valued at Rs 41,800 crore in 2018. In dollar terms, IPL’s brand value has grown 7 percent, from $6.3 billion in 2018 to $6.7 billion in 2019. Loyalty to the IPL by audiences and broadcasters has remained steadfast over the years, and 2019 stood out on both accounts.

“With the rapid increase of digitisation, (Star TV-owned OTT) Hotstar broke its own world record of 10.7 million concurrent over-the-top viewers that it set during last year’s IPL final, not once, but twice, in this edition of IPL – first with 12.7 million concurrent viewers in a league match and then with 18.6 million for the finals—a testament to the continued popularity of the tournament,” said Varun Gupta, managing director, Asia Pacific leader for valuation services, Duff & Phelps.

“It is noteworthy that despite 2019 being the World Cup year, a 20 percent increment has been witnessed in ad spending. The advertisers could have taken a conservative stance and saved their budgets for the World Cup, but the high viewership interest in IPL continued to attract them,” adds Gupta.

The big two of IPL, Mumbai Indians (MI) and Chennai Super Kings (CSK), continued their absolute dominance with MI winning their fourth IPL title in 2019, the most by any team in the history of the IPL.

This superlative performance led to MI retaining the title of the most valued brand in 2019. Presiding at the number one position, Mumbai Indians’ brand value rose from Rs 746 crore in 2018 to Rs 809 crore in 2019, a jump of 8.5 percent.

Led by MS Dhoni, CSK retained the number two position, with it’s brand value rising from Rs 647 crore in 2018 to Rs 732 crore in 2019, a rise of 13.1 percent. Delhi Capitals has been another big gainer by 8.9 percent (in INR terms), again due to their strong on-field performance this year.

But the consistent poor on-field performance of Kolkata Knight Riders (KKR) and Royal Challengers Bangalore (RCB) took a toll on their brand values, with both franchises shedding approximately 8 percent of their brand value over last year.

“KKR’s brand value has been impacted due to their poor on-field performance in the last couple of seasons in addition to a lack of marquee players. KKR is one brand which generates significant equity from Shah Rukh Khan’s (personal) brand. Considering there has been an impact on brand SRK, it has had a trickle-down effect on KKR as well,” said Santosh N, managing partner, Duff & Phelps India Advisory.

KKR, the third most valued brand, saw its value erode by 8.3 per cent from Rs 686 crore in 2018 to Rs 629 crore in 2019. RCB’s brand value has reduced from Rs 647 crore to Rs 595 crore in 2019.

“RCB’s consistently poor on-field performance and over-reliance on Virat Kohli and AB De Villers have negatively impacted the brand credibility and a correction was inevitable. RCB is the only team in our top five rankings not to have won an IPL trophy since its inception. If not for the presence of Virat Kohli, and a loyal fan base for the franchise, it’s brand value would have seen significant erosion in the last couple of years,” said Santosh N.

Rajasthan Royals, at the bottom of the ranks, also saw it’s brand value erode due to on-field performance, lack of marquee players and major controversies surrounding the team historically.

With the IPL entering into a mature and stable phase, the Duff & Phelps report underscores the importance of franchisees engaging with fans off the field, and outside the IPL tournament, to monetize their brands and create alternate revenue streams.

The reports shed light on the challenges that franchisees face in monetizing merchandise successfully like major football clubs and sporting leagues around the world.

“The large, unorganised counterfeit market in India has been a major challenge and it is important to crack the whip on counterfeit products to maximize the gains for the IPL ecosystem. However, it is also important that the stakeholders evaluate their pricing strategy for merchandise to deter the production of fake goods, especially in the cost-conscious Indian market,” said Gupta.

“While counterfeits exist even in developed nations, the difference in price between the counterfeits and originals is not vast. In India, the difference can be more than 10 times, with a T-shirt purchased outside a stadium costing Rs 200 and a branded, in-store T-shirt costing Rs 2,500, The second issue is that the Purchasing Power Parity (PPP) in India is significantly lower than in the US or in Europe. This incentivizes even the seemingly well-to-do to go in for counterfeits,” said Santosh N.

“Only successful monetisation will take the IPL from a $6 billion property to a $25 billion over the next decade,” he added.

On sponsorship rights, there is room for significant upside, says Duff and Phelps. “If we go by the recently renewed BCCI and Paytm title sponsorship deal (an increase of 58 percent on a per-match basis over the last deal), IPL will be looking for another massive increment when the sponsorship rights are up for grabs in the year 2022,” said Gupta.

For companies too, the association with IPL has been very rewarding. Chinese phone maker Vivo, which earned the title sponsorship for IPL in 2015, has seen it’s market share rise to 15 percent to become the third most-selling phone in India. The IPL has also tremendously contributed to helping Dream 11 – the official partner of the IPL for three years starting 2019 – capture 90 percent of the fantasy gaming industry in India.

For individual franchises, team sponsorships and sponsorship revenue from the IPL central pool is critical to keep teams financially viable and there seems to be no dearth of capital.

IPL 2019 saw over a 100 team sponsorships from different industries including e-commerce, beverages, educational institutions, government bodies, insurance and healthcare providers including companies such as Samsung, Viacom18, Muthoot Group, Nokia, Reliance Jio Digital, WROGN and Daikin among others.

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TV industry worried as piracy of channels rises 300% under new regulatory framework

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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When 67-year-old Mumbai resident Ajay Verma* received a call from his local cable operator informing him that his cable bill had increased from Rs 375 to Rs 429 a month, Verma was piqued. How was this possible, given that he had carefully picked channels to keep his bill under control? His service provider assured him they would ‘work it through’ and asked Verma to pay a visit to their office. Once there, Verma was offered a unique deal – pay Rs 475 a month and avail all 300+ channels that were being provided before the New Tariff Order (NTO) was implemented on February 1. An ardent TV watcher, Verma jumped at the offer, not quite realising he had succumbed to piracy.

On the other side are stories of distressed service providers. In Telangana’s Nirmal district, an aggrieved local cable operator (LCO) reached out to his distributor complaining that a rival operator was providing 770 unencrypted channels for only Rs 120 a month, causing him to lose more than 400 connections in only five days.

Yet another cable operator in Madhya Pradhesh’s Satna district was in a similar situation. A competing LCO had installed a local headend unit and was provided pirated channel packages at less than half the price issued by broadcasters, causing him to lose 700 subscribers. With the rival operator wielding sufficient political clout, filing a police case against him was difficult.

‘300 percent rise in piracy cases since new framework’s implementation’

Leading broadcasters and Multi-System Operators (MSOs) say there is a three-fold rise in piracy of TV channels after the new regulatory framework was implemented, leaving them worried about its impact on their coffers and the lack of legal provisions and intent by the government to fight piracy.

A prominent broadcaster CNBC-TV18.com spoke to said they had filed more than 200 complaints since February with authorised officers, intimating the Ministry of Information and Broadcasting (MIB) and telecom regulator Trai, but no action has been taken till date. “There has been a 300 percent increase of unauthorised transmission reported since the NTO was implemented from February 2019. The mode of piracies are unauthorised transmission, providing analogue signals, undeclared CAS-SMS system, dual Local Channel Number (LCN), and networks showing cricket series in violation of the SC order,” said a senior executive from the broadcaster, citing anonymity.

The rise in channel piracy by 300 percent since the NTO came into effect was corroborated by several broadcasters and distribution operators that CNBC-TV18.com spoke to.

“Earlier we dealt with piracy cases on a limited basis, now it has risen more than three-fold. Across the country, MSOs are mushrooming as they have begun to realise there is profitable business to be made through piracy of channels. It is spreading like wildfire, and is killing legitimate players like us,” said a senior executive from a large-scale MSO who did not wish to be named due to the sensitivity of the matter.

Madhya Pradesh, Telangana, Andhra Pradesh and Gujarat emerged as the top states for piracy of TV channels.

The case for rising piracy under NTO

“Unfavourable economics of the new regulatory framework is the primary reason why piracy has surged. On one hand, rising consumer cable bills and the subsequent loss of customers is incentivising MSOs to pirate TV channels. In parallel, LCOs are receiving a smaller share of earnings than before, but are expected to invest in sophisticated billing systems and higher manpower to service customer requests. This reduced earning is pushing LCOs to resort to piracy,” said Shivangi Mittal, Associate, Koan Advisory.

Adverse economics on one hand, the lack of legal armour on the other, is another reason for unabated piracy.

Senior legal executives from two popular broadcasters say the new regulatory framework has not only failed to protect content creators, rather it has clamped down on their powers to exercise control, leading to rampant abuse of the new system. For one, neither the Cable Television Networks (Regulation) Act, 1995 nor the Telecommunication (Broadcasting And Cable) Services Interconnection (Addressable Systems) Regulations, 2017 (Interconnect Regulations 2017) define piracy, let alone carry provisions on anti-piracy. This leads to grievances being addressed by the Copyright Act, 1957, which falls squarely short of dealing with piracy, which is a criminal offence.

To make matters worse, the Interconnect Regulations 2017 have scrimped upon broadcasters’ powers to withhold signals from DPOs. Under the ‘Must Provide Principle’ of the Interconnect Regulations, it is obligatory for broadcasters to provide TV signals to Distribution Platform Operators (DPOs) within 60 days from the date of receipt of request from the service provider and within 30 days of signing the interconnection agreement. Broadcasters have argued that even in cases where DPOs have repeatedly defaulted on payments or indulged in piracy, they have been legally bound to provide signals to them.

The Interconnect Regulations also permit broadcasters to conduct an audit on suspect cable operators only once a year. During the time the audit is commissioned, a broadcaster cannot receive any payments from the operator. This greatly reduces the incentive for broadcasters to commit to audits and gives a free hand to piracy, argue broadcasters.

New modes of piracy come to the surface

Broadcasters and MSOs say the MRP-based regime introduced under the new regulatory framework has resulted in new ways to pirate TV channels.

Let us first understand how transmission of channels takes place. In India, a broadcaster supplies an Integrated Receiver Decoder (IRD) to a DPO to receive and decode the encrypted signals of its channels. The distributor then decrypts the channel authorised by the broadcaster. The decrypted signals of the channel are then re-encrypted by the DPO (as required by law and contract) and distributed to its subscribers directly (DTH) or through a LCO. A subscriber is authorised to watch channels through the Subscriber Management System (SMS) and the Conditional Access System (CAS). The SMS communicates with the DPO’s CAS to activate the channel on a subscriber’s Set Top Box (STB).

Next, let us see how piracy has evolved under the NTO.

Under the earlier fixed-fee deal system, broadcasters and DPOs would agree on an annual sum that the distributor would need to pay to air the broadcasters’ channels. If the distributor disagreed on the fee, he would resort to piracy through either of these methods:

Unauthorised sharing of broadcaster’s signals

This generally occurs when a broadcaster shuts down signals of its channels to a DPO due to non-payment of dues. The defaulting DPO colludes with another distributor to transmit unauthorised signals of their channel by swapping the Integrated Receiver Decoders or feeding channels from the abetting distributor’s IRD.

Unencrypted feed

According to the Digital Addressable Systems Regulations, it is mandatory for cable operators to distribute channels only in encrypted form which ensures accountability in the CAS and the SMS of the number of subscribers viewing a channel.

When a channel is distributed in an unencrypted form, the number of subscribers receiving such a channel will not be reflected in the CAS-SMS system of the DPO. As a result, such subscribers will not be reported by the DPO to the broadcaster, amounting to under-declaration which cannot be identified through audits. This under-declaration leads to loss of revenue to broadcasters and the government loses the ability to tax the DPO.

Undisclosed/multiple CAS-SMS systems

Several DPOs use multiple CAS-SMS systems to activate channels on a subscriber’s STB. However, the DPO does not declare all the CAS-SMS systems deployed by them. Again, this leads to under-reporting of subscribers to broadcasters and loss of revenues.

Using DTH / IPTV Set Top Boxes for cable redistribution

According to TRAI regulations, TV channels distributed by authorised DPOs cannot be redistributed by other unauthorised DPOs. However, due to lack of standardisation on the insertion of the DPO’s watermark, or the DPO’s STBs being compromised, there have been instances where pirates install DTH/IPTV STBs in their control room and retransmit unauthorised channels. This mode of piracy is rampant when sports broadcasters share the live signals of the sporting events of ‘national importance’ under the Sports Act, 2007.

While piracy has increased using these existing methods, new modes of piracy have been detected under the new tariff regime.

Dual Logical Channel Number

Every pay channel is assigned a Logical Channel Number (LCN) on which it airs. In the case of dual LCN, the channel is listed in two frequencies or in two different genres. The DPO leaves the channel in an unencrypted mode in one frequency/ genre (airing it on a local channel) to hide its subscriber base, leading to loss of revenue to broadcasters.

Cloning

Every STB distributed by the DPO needs to have a Unique ID. A cardless STB’s unique ID is its Unique Authorization Number (UAN). A UAN can represent only one STB /subscriber. Cable piracy through cloning occurs when one UAN representing one STB/subscriber is duplicated across multiple STBs/subscribers. This leads to piracy of channels and under-reporting of subscribers.

Illicit Set Top Boxes

In both online and offline markets, illegal STBs are widely available. These STBs decrypt channels by extracting the ‘decryption keys’ from legitimate STBs of the DPOs. The keys are then updated on servers and delivered through internet to the illicit Free-To-Air STBs. This hacking of STBs compromises the DPO’s CAS system /STBs. Unfortunately, DPOs are yet to upgrade their systems to prevent such decryption and do not take steps to resolve such illegitimate extraction of encryption keys.

Resurfacing of analogue transmission

In 2012, the government began the digital switch-over across India, with analogue TV signals being switched off and replaced by encrypted digital signals. Under the NTO, however, cases of analogue TV transmissions have resurfaced, across both, metros and tier 1-4 cities, in violation of the Digital Addressable System Regulations.

LCO lobby bodies rubbish claims of rising piracy, call it broadcasters’ desperation

When CNBC-TV18.com contacted Roop Sharma, President, Cable Operators Federation of India, she slammed claims of piracy surging under NTO. “Earlier, broadcasters forced their channels upon customers through bouquets. Under the new transparent regime, broadcasters realised there is very little or no demand for their channels. With subscription revenues falling, broadcasters are drumming up a hue and cry over piracy of their channels. When there is no demand for their channels and consequently STBs, why would anybody want to pirate their channels?” argued Sharma.

When questioned about the various modes in which piracy was taking place, Sharma said, “The Integrated Receiver Decoders used by DPOs are either provided by the broadcasters or have been sourced as per specifications issued by the broadcasters. So where is the question of illicit boxes?”

Mechanism for grievances inadequate, government bodies pass the buck

Perhaps the biggest setback for broadcasters and MSOs threatened by piracy is the government’s lack of will to fight the menace. For one, as pointed out earlier, neither the Cable Television Network, 1995 nor the Interconnect Regulations, 2017 have given a definition to what piracy constitutes and are bereft of any provisions to fight the same. While the new regulatory framework was expected to help curb piracy, experts say the government is unlikely to accept it has fallen short on this objective.

“The government is under tremendous pressure with subscribers falling drastically under the NTO. To accept that there is massive manipulation of the CAS–SMS system under the NTO, which has led to under-declaration of subscribers would be a hard slap in the face,” said a noted media advocate who requested anonymity.

The redressal mechanism is mired in tangles, say broadcasters and MSOs. Under Section 18 of the Cable Television Network Act, 1995, no court can take cognisance of any offence punishable under this Act except upon a written complaint made an authorised officer. An authorised officer is the district magistrate, a sub-divisional magistrate, or the commissioner of police.

“In most cases, authorised officers are district collectors. Their primary duty is revenue collections and dealing with piracy complaints is their last priority. In the case of sub-divisional magistrate, most are unfortunately not even literate; to expect them to understand the intricacies of piracy is out of the question. When matters go to the police, piracy complaints feature at the bottom of their action list as the system is overburdened by other criminal offences,” said the advocate quoted earlier.

That apart, cable operators are known to enjoy significant political power, with close affiliations to local politicians and the police. Taking action against them therefore, becomes perilous.

There is silence from the government’s quarters too. Broadcasters and MSOs say complaints sent to authorised officers are also shared with the MIB and Trai. But no response is forthcoming from either, with both the ministry and the regulator passing the buck to each other.

When contacted, a senior MIB official said: “I am not aware of the incidence of piracy. However, this is under Trai’s jurisdiction.”

CNBC-TV18.com’s attempts to reach Trai regulator RS Sharma did not elicit a response. A detailed questionnaire sent to MIB and Trai did not receive a response till the time of this article being published.

Negative impact on TV ecosystem; lack of data a challenge

The rampant piracy of channels under the NTO has lead to under-declaration of the number of subscribers, non-payment of subscription fee owed to the broadcasters and tax evasion, say broadcasters.

“This not only negatively impacts a broadcaster’s ability to invest in acquisition and production of content, but also hampers legitimate monetisation of properties invested into by broadcasters,” said the senior executive quoted at the beginning.

Add to that the rising costs of tackling piracy. One of the legal executives quoted earlier said piracy costs for the broadcaster he was associated with has gone up six times since the implementation of the NTO.

According to a report released by the Cable and Satellite Broadcasting Association of Asia (CASBAA) in 2011, signal piracy losses in India alone stood at USD 1.4 billion a year. The losses today would be much more, given the advances in broadcast signal distribution devices and the speed at which unauthorised broadcast channels can be transmitted via the internet. The loss to the coffers of broadcasters and MSOs in turn translates to losses to the government exchequer. It may also be linked to illegal and/or criminal activities such as money laundering and violation of tax and foreign exchange regulations.

This also points to the alarming fact that no official data on signal piracy is available for the years after 2011, despite the fact that the move to digital addressable systems and the implementation of the new regulatory framework was expected to tackle piracy in a holistic manner. So why has the government not commissioned a study on the same?

Fighting piracy: The need of the hour

Broadcasters and MSOs say the need of the hour is to recognise attempts to transmit or retransmit unauthorised broadcast of TV channels as ‘piracy’ under the Cable TV Networks (Regulation) Act, 1995. Actions considered to be cable piracy should include unauthorized/ undisclosed transmission and re-transmission of broadcast signals.

Broadcasters say strict anti-piracy provisions need to be stipulated with immediate effect, with fines, penalties and imprisonment in line with criminal offences.  The law should also take steps to ban hacking devices, which are widely used today to pirate through the internet.

At the end of it, only the government’s firm intent and subsequent actions to fight piracy will uphold the legitimacy the new regulatory framework sought to establish.

*Name changed upon request

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Is the threat real? Nearly 40% online video consumers could cut the TV cord soon, says study

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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For India’s TV industry, surviving the onslaught of online video apps is perhaps the most crucial challenge they will have to rise to, with 38 percent online users surveyed for the latest report by KPMG India-Eros Now titled ‘Unravelling the digital video consumer’, considering pulling the plug on their TV sets.

Thanks to the diversity of content and its around-the-clock availability on over-the-top (OTT) apps, a staggering 80 percent of the respondents to the survey across different city tiers and income brackets admitted that online videos were more than sufficiently addressing their entertainment needs, driving 38 percent of these respondents to consider cutting the cord in the immediate future. Nearly a third of these users are in the age bracket of 25-50 years.

The survey was commissioned across 1,458 OTT users in 16 Indian cities, which included the top three metros, five tier 1 cities and eight tier 2 cities.

While respondents in the highest income bracket of above Rs 10 lakhs were found to have a higher inclination towards cutting the cord, nearly a third of respondents earning less than Rs 5 lakh rupees annually were also considering the same, indicating the success of OTT platforms in democratising their content and making itself accepted across a wide spectrum of audiences.

Across tier 1 and tier 2 cities, the percentage of online users contemplating pulling the TV plug was identical at 33 percent. These users showed a higher propensity to let go of their TV subscription when compared to those in metros, showed the data.

“In tier 1 and 2 markets, audiences typically tend to be subscribers of free content on Advertising Video on Demand (AVoD), those who typically watch catch-up movies and TV programmes, whereas metro users have a higher propensity towards subscription-based models. With telecom providers such as Reliance Jio providing 1GB/day bundled plans (voice+ data+ content) for merely Rs 200 a month, it is highly conducive for tier 1 and tier 2 users to unsubscribe from TV and watch the catch-up content on their apps,” said Girish Menon, Partner & Head, Media and Entertainment, KPMG India.

Content is the proverbial king, with 39 percent online users rating ‘quality of content’ as the reason why they would kick out their TV, followed by the ease of watching content ubiquitously on apps and their value for money. While the most preferred category of content for those willing to snap the TV line was movies and music videos, catch up TV content was the most preferred category for those not willing to give up on TV.

“Movies and catch up content were of primary importance to potential cord-cutters, with the preference for original content being lower than for non-cord-cutters. This outlines the fact that potential cord-cutters are probably not digital-natives but consumers who could look to online video for the ease it provides, while still remaining true to their traditional video choices. However, the lower preference for online originals among cord-cutters could also be a function of low supply that originals suffer from currently in the market,” said the report.

When asked if the new regulatory framework for TV, under which consumer ARPUs have risen 30-70 per cent, is a driving factor for potential cord-cutters, experts have differing viewpoints.

“The OTT industry is in a hyper-growth mode, so it’s difficult to distinguish whether it is the new framework or the infrastructure in a particular city or state being established that has led to the surge in online users, and which could similarly drive the decision of potential cord-cutters,” said Ali Hussein, COO, Eros Now.

“Cord cutting by lower-income consumers in the wake of the NTO would be an inversion of global trends. This cannot be called an intended outcome. It is inexplicable why a competitive broadcasting market is subject to regular micromanagement; economic regulation must be reserved for market failures. The regulator must now look to preserve economic value,” said Vivan Sharan, Partner, Koan Advisory.

Despite the unnerving prophecy, experts say it is far from doomsday for the TV industry, which caters to 197 million households in India, 98 per cent of which are single-TV households. “At the moment, the decision to cut the TV cord is a family decision, not a singular one. Only 5 per cent of daily online video watching takes place on Internet-enabled TV/ smart TVs which can cater to the full family’s viewing experience. Secondly, the cost of online apps for family viewing is still far from favourable when compared to cable/DTH TV,” said Menon.

“Most broadcasters have realised where the future is and are fast evolving from pure-play TV content creators to multi-platform content studios catering to TV, OTTs, telcos and other platforms. In that sense, the content value chain is being separated from the distribution supply chain,” he adds.

That said, Menon accepts that the rapidly changing content ecosystem, supported by Fibre-To-The-Home (FTTH) plans and the launch of 5G could catalyse the migration to online apps by significantly rewriting the economics for online usage for TV-watching families.

On the back of cheap mobile data and growth in smartphone users, India’s online video ecosystem will reach a critical mass of 325 million users by December 2019, a figure that is expected to touch 550 million in 2023, states the report. On the supply side, the number of OTT platforms have grown more than three-fold in six years, from 9 in 2012 to more than 30 in 2018.

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Discovery files petition against TRAI’s latest consultation paper in Delhi High Court

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Discovery Communications, India’s largest reality and infotainment broadcaster, has filed a petition in the Delhi High Court against The Telecom Regulatory Authority of India (Trai), seeking to quash the regulator’s latest consultation paper, terming it “illegal and lacking in objectivity, transparency and fairness of approach.”

This marks the second time Discovery has taken TRAI to court over its new regulatory framework, which comprises of the Interconnect Regulations 2017, Quality of Standards Regulations, 2017 and Tariff Order, 2017.

In its 239-paged petition dated August 28, Discovery has taken on the Trai’s consultation paper dated August 16, which attempts at reviewing the New Tariff Order (NTO), only seven months into its implementation, in a bid to cut channel prices. Discovery has argued that the Trai’s consultation paper has a “pre-mediated approach” to hold broadcasters responsible for manipulating prices and kerbing consumer choice.

“The Impugned consultation paper fails to conform to the fundamental tenets of transparency and objectivity by proceeding with a pre-determined notion that channel broadcasters, including the petitioner (Discovery), have distorted the broadcasting market and consumer choice through perverse pricing and deep discounting and have therefore called for suggestions on the ways and means to remedy the situation,” reads the petition.

The petition has alleged that the regulator has already made up its mind to align individual channel prices with bouquet prices and therefore the entire consultation exercise, conducted with a “close-mind at the state of consultation itself” is merely an “idle ceremony”.

Discovery has also challenged that the consultation paper is a “flagrant attempt” by the Trai to “defeat and obfuscate” the broadcaster’s earlier petition which is at the final stage of hearing. By “proceeding on assumptions as if they were conclusive evidence of market distortion…when the sanctity of these same-self assumptions are a subject matter of challenge before the HC”, Discovery has argued that the regulator is attempting to “pre-empt the outcome of the judicial proceedings”.

In August 2017, Bharti Telemedia, the holding company of Airtel Digital TV, Sun Direct, Tata Sky and Discovery Communications had filed a petition against the Trai, on the grounds that the new regulatory framework was “arbitrary, discriminatory and failed to address subscriber interest”. The final hearing of this original petition is scheduled on September 19.

Elaborating on the three main issues that Discovery says the Trai is attempting to “obfuscate” through its consultation paper, the petition states that the regulations allow distribution platform operators (DPOs) to discontinue any channel having less than 5 percent of the average viewership of the DPO. This, the petition argues, amounts to restriction of carriage rights of niche channels having limited viewership.

Discovery Communications, which offers a variety of niche programming channels including Discovery Channel, Discovery Science, Discovery Kids, Animal Planet and TLC, has a limited viewership in India, with a television share of 0.75 percent across its genres.

Discovery has also argued that Trai’s assumption that the unreasonable amounts of discounts offered by broadcasters’ results in “illusionary perverse pricing affecting consumer choice” is “without any basis” and not based on any study.

In its consultation paper, the Trai came down heavily on broadcasters for offering bouquets at a 70 percent discount to the sum of the same channels on an a-la-carte basis, thereby “forcing” consumers to opt for bouquets instead of picking individual channels of their choice. The regulator has accused broadcasters and DPOs of “throttling the market discovery” of prices through deep discounting of channel bouquets.

Discovery has also hit out at the Trai’s conclusion that DPOs are not availing a-la carte channels due to high costs compared to bouquets, stating the conclusion does not consider any “economic or empirical data.”

Discovery argues that while the three issues are not founded on any scientific or market study and are awaiting adjudication, by introducing a consultation paper at this stage, the Trai is trying to avoid the adjudication process by rendering the original writ petition infructuous.

Discovery also points out that to demarcate channels that have low viewership as unpopular channels does not speak to the mandate of an economic regulator such as Trai, which is acting on social grounds. It has also pointed that the new regulatory framework has accorded substantial power to distribution platforms which try to maximise revenues by pushing popular channels, leaving broadcasters at their “sole mercy.”

On the issue of the capping of discounts on bouquets, the petition states that Trai is attempting to “override and disregard” the verdict of the Madras HC and the Supreme Court by reintroducing the same issue in its consultation paper. The Madras HC, in a verdict on May 23, 2018 had struck down Regulation 3(3) of the Tariff Order which provided for a 15 percent cap on the discount offered on a bouquet vis-a-vis the sum of the a-la-carte channels forming that bouquet. The verdict of the Madras HC was upheld by the SC in December 2018.

With Discovery knocking on the High Court’s doors, Trai could see more legal action from other incumbents in the broadcasting industry. The broadcasting industry has been up in arms against the latest consultation paper which they see as an attempt to control prices. The Indian Broadcasting Foundation, which released a media statement last week, said the regulator’s latest move could have “disastrous consequences” for the broadcasting sector, forcing small and niche players to fold up, eroding capital for content creation and drying up advertising revenues.

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Broadcasters up in arms over Trai’s review process, regulator attempts damage control

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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“Trai is going to write the obituary of the broadcasting industry,” said an exasperated senior executive from a leading broadcaster on condition of anonymity, hours after the telecom regulator initiated a review of the new regulatory framework for TV and cable services on August 16 by floating an exhaustive public consultation paper.

Even as Trai attempts to quell the furore over its consultation paper, broadcasters CNBC-TV18 spoke to express anger, dismay and even bewilderment at what they see as an attempt to control prices in the broadcasting industry, a move they say can have “disastrous consequences”.

The timing of the review process, coming only seven months after the implementation of the New Tariff Order (NTO), has irked broadcasters who say the industry was only just beginning to settle after a monumental shift to an MRP-based pricing regime. In a media release earlier this week, the Indian Broadcasting Foundation (IBF) termed the consultation paper “premature” and warned that “regulatory intervention at this early stage in the implementation of the NTO will have disastrous consequences for the broadcasting industry.”

Mirco-managing broadcasting sector

“As a regulator, Trai cannot micro-manage the broadcasting sector. Trai should be the last body to unsettle the apple cart. Post the implementation of the NTO, the TV industry has lost 10 million subscribers. If further amendments are suggested, after we have spent significant sums to align with the NTO, it can significantly damage the sector. Where will get the money to produce content?” argued the executive quoted earlier.

The Trai, on its part, has sought to allay broadcasters concerns by stating it has no intention to revise the NTO. In an interview to the Economic Times, Trai Chairman RS Sharma said the regulator is not looking to fundamentally change the NTO, but only “fine-tune” the policy. Sharma has said that through the consultation paper TRAI was attempting to “bring perfection in the phenomenon observed in the last few months” as they are bound by “duty to protect the interest of consumers”.

Broadcasters dismissed Sharma’s “carefully worded” arguments claiming that Trai is merely attempting to calm flying tempers and prevent legal action by aggrieved stakeholders and that the “tweaks” that would ensue would be tantamount to altering the NTO. Many in the broadcasting industry have questioned the integrity of Trai, squarely suggesting that it was favouring distribution platforms under the garb of protecting consumer interest.

The public consultation paper, which is open for comments until September 16, has invited comments from stakeholders on nearly 30 questions pertaining to whether channels should be permitted to form bouquets, whether the 15 percent discount cap between the sum of a-la-carte channels and those when part of a bouquet should be reintroduced, whether broadcasters and DPOs were offering far too many bouquets and whether the ceiling price of channels in bouquets (Rs 19), needs to be re-examined.

The Trai, in its paper, states that the decision to review these aspects of the NTO follows numerous complaints received from consumers on not being able to exercise choice of channels and rising cable bills.

When asked why Trai isn’t justified to act on consumer complaints, broadcasters demanded to know how many complaints were received so far, a figure not disclosed by the regulator. A leading broadcaster argued that every attempt was made to smoothly transition 130 million households to the new framework and to initiate a review early into the system basis complaints from a small percentage of TV consumers was arbitrary and unfair.

Attempt to throttle discovery of market prices

Broadcasters have lashed out at Trai for accusing them of misusing the flexibility provided by NTO to “throttle the discovery of market prices” of channels by offering bouquets at steep discounts to the sum of their al-a-carte prices of pay channels, thereby forcing consumers to opt for bouquets as opposed to picking individual channels.

Broadcasters argue that channels bouquets are a common practice worldwide and are designed to offer maximum choice of content to consumers at reasonable prices. Broadcasters package less popular channels by bundling them with popular channels to get maximum reach and amortise the cost of content creation. A ban on forming bouquets and offering them at discounted prices, broadcasters warn, would mark the “beginning of the end of the industry.”

“Discounting is critical to keeping reach alive. The consequence of reach dropping is that it will lead to significant consolidation with small and niche channels folding up,” explains Jehil Thakkar, Partner and Head, Media & Entertainment, Deloitte India. ”While Trai’s desire to keep ARPUs affordable is laudable, prices should be decided by market forces,” he adds.

The decision to offer a large number of bouquets is designed to offer maximum choice of content to consumers while serving their pocket, say broadcasters. Broadcasters say they are surprised that Trai should come down heavily on the number of bouquets being offered as the regulator had “expressed happiness” during numerous consultation rounds on the large number of choices being made available to consumers

On the issue of lowering ARPUs, Sharma has stated that Trai is not attempting to regulate ARPUs, but broadcasters are not convinced. They argue that on one hand, cable TV ARPUs in India are lowest in the world, on the other, while consumer inflation rages at 7 percent, cable TV ARPUs have risen at a CAGR of only 4 percent. To control channel prices, despite cable/DTH services not being defined an essential commodity is discriminatory, say broadcasters.

Analysts say a balanced approach and sufficient time is the only way to keep the TV industry on an even keel.

“It is critical that Trai balances consumer needs with the economics of the sector. It is highly recommended that the NTO be allowed to play out for a year before any regulatory changes are implemented. This would allow all stakeholders, most importantly consumers, to fully comprehend the system and understand the choices they are making,” said Girish Menon, Partner and Head, Media and Entertainment, KPMG India.

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Slowdown impact: Festive season to see muted growth in ad spend

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Amidst a slowdown in the economy, India Inc. is likely to spend between Rs. 25,000-28,000 crore on advertising and marketing during the festive period, accounting for low to modest growth over last year, top media planners said.

“While we certainly don’t expect significant growth in festive ad spending like in earlier years, advertisers will spend nearly Rs. 28,000 crore between Ganesh Chaturthi and Christmas this year. As such, we expect an 8-12 percent growth in festive adex over last year,” said Ashish Bhasin, Chairman, CEO – South Asia, Dentsu Aegis Network.

Others, on the other hand, expect no growth in festive ad spending this year.

“We don’t think the slowdown in auto and consumer categories is going to impact the total festive ad spends. The reason for this is because consumers are still going to spend on e-commerce and lifestyle categories. This year, however, we see that the festive adex category will remain constant at
Rs 25,000 crore or will have very marginal increase. Print will be the lead medium with more than 70 percent SOE (Share of Experience), followed by TV and radio,” said Saurabh Varma, CEO, Publicis Communications, South Asia.

“In the first half of the year, the general elections, the IPL and the World Cup gave advertisers plenty of opportunities to generate significant advertising revenues. During the festive period, we will see spends in line with last year .i.e, Rs 25,000 crore,” said Partha Ghosh, COO, West and South, Percept Media.  “While the slowdown in the consumption and automobile sectors has impacted ad spending, natural disasters such as floods have further catalysed the curb on ad spends. If nature’s fury continues into the festive period, it will further impact overall spends especially by the FMCG sector,” he added.

“This year the industry had projected a 14-15 percent growth for 2019 led by the 3 marque events – IPL, World Cup and Elections. While those events went off well, the current season has not witnessed a lot of ad spends by brands on the back of economic slowdown. The festival season is a very critical period for most advertisers for all categories in the country. Brands will not take the risk of cutting their media budgets during the festival quarter. They are expected to spend heavy media money to woo consumers. However, because of the current slowdown, the annual growth rate in media might go down to 10-12 percent,” said Navin Khemka, CEO, Mediacom South Asia.

Earlier this year, Madison World revised its advertising expenditure growth forecast, lowering it from 16.4 percent to 13.4 percent. The revised Pitch Madison Advertising Outlook Report 2019 states it expects Q3 to be “reasonably strong” on the back of the festive season. “It appears that the consumer is looking for reasons to not spend or delay his spending. At a time like this, advertisers should not lose faith in advertising, and use it aggressively but effectively to protect their share,” said Sam Balsara, chairman of Madison World in the report.

The festive period, which begins with Janmashtami, Ganesh Chaturthi and Onam and ends with Christmas, is an important time for advertisers, accounting for nearly 40 percent of the advertising expenditure for the year.

This year’s festive period comes at a time when the Indian economy stares at a weaker-than-expected demand outlook, with both the IMF and the Asian Development Bank lowering their growth forecast for 2019, citing domestic and global headwinds. The slowdown has been extremely pronounced in the automobile sector, with inventory piling up and thousands of lay-offs across the sector as consumers hold off big-ticket discretionary purchases.

The FMCG sector has witnessed a significant slump over the past four quarters, both by volume and value. The slowdown is particularly pronounced in the hinterland, with market researcher Neilsen stating that rural consumption is slowing down at double the rate of urban, in its latest quarterly report ‘India FMCG growth snapshot’.

The e-commerce sector is, however, bucking the trend with online spending on consumer durables and white goods sustained by heavy promotions and deep discounts through shopping festivals. This will continue in the festive period too.

While the FMCG, automobile, e-commerce and jewellery sectors will continue to be staple contributors to this year’s festive ad spends, media planners say they expect heightened activity by OTT platforms and entertainment channels, telecom, travel and tourism and real estate players. The automobile industry, which is reeling under the worst slowdown it has seen in nearly two decades, will use the festive period to aggressively push idle inventory, they added.

“One change we will see is in Chinese consumer goods, who will reduce their Above –The-Line (ATL) ad spends this year significantly, but will increase their spends on digital. This is because these products have created awareness through ATL campaigns. Now, they’ll take the tactical route, through spends in sponsorship and digital as their main medium,” said Varma of Publicis Communications.

Expenditure on digital advertising continues to grow at the fastest rate amongst all mediums. KPMG India’s latest report on the M&E sector, “India’s digital future: Masses of niche, states that the digital advertising segment grew 38 percent in FY19, even as TV advertising spends were impacted by consumption slowdown and the impact of the New Tariff Order. While advertising revenues continued to drive the print medium in FY19, the sector continued to witness a subdued growth of 4.5 percent.

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