Competitive Strategy of
English News channels in India


By
ADITYA KR. BAJAJ
AJAY A.V.
AMIT SINGH
ANGANA JACOB
KHOLI KAYIDENI
SWASTIK NIGAM




1Table of Contents

Abstract ……………………………………………………………………………… 2

Industry Analysis…………………………………………………………………… 3

NDTV……………………………………………………………………………….. 8

Strategic analysis of competitors
CNN-IBN………………………………………………………………………… 12
Headlines Today………………………………………………………………… 14
Times Now………………………………………………………………………. 16

Conclusion………………………………………………………………………… 18































2Abstract

The News Channel industry in India is on a fast growth track. This can be observed
through the proliferation in this industry over the last few years. The number of news
channels as well as the turnover of the industry has grown tremendously. This report
consists of an industry-level analysis where the components of the various forces of the
English news channels are identified, analyzed and their impact studied. We have focused
on the leader, NDTV 24x7 and studied its competitors, CNN-IBN, Times Now and
Headlines Today from its perspective.
3Industry Analysis
The Television News industry in India has seen incredible growth in the last few years -
from a one hour slot on Doordarshan to around 40 dedicated news channels today.
Viewer interest in news as a genre has increased over the last few years in India. India's
mounting obsession with news is fueled by a new climate of change and by the economic
transformation of the past decade. In many ways, the increasing interest in news channels
is a product of increasing globalization as well as an indicator of an increasingly sensitive
citizen. Through expert discussion (Roushan, 2006), we were told that the Indian viewer
is more news sensitive than in many other nations. This maybe attributed in part to the
complex social structure in India, leading to sensitivity to a larger number of issues.
Television channels are fuelled by the revenue from advertisements. The ad spends in the
industry grew from Rs. 40 crore (2000) to Rs. 700 crore (2005) (Times, TV 18 to
launch.., 2005). Today the number of news channels stands at around 36 with at least 16
national news channels (Roushan and Bhohi, 2006)
Below we analyze the various forces affecting the industry its various players.
Structural Determinants of the industry
The various factors outlined below are the result of the personal communication that we
had with industry experts (Sardesai and Roushan, March 2007). The analysis focuses
only on the English News channels in India.
Bargaining Power of Buyer
A. Buyer power (the viewer)
It is interesting to observe that the Buyer - Supplier relationship in the News industry
(more generically the TV industry) is two-pronged. The buyer is not only the consumer,
the citizen of the nation, but also the advertiser.
Demographic Trends
1. If we consider the Indian demographics, we observe that with increase in literacy
levels (News: a growing genre, 2007), the viewership of the news genre is also
increasing. India has a large population of over a billion people whose mean age
is only 34 years. The younger generation has higher literacy levels and hence
news channels are likely to get a greater share of this viewership.
2. There is rapid urbanization, in the metros and Tier 1 and 2 cities alike. This will
lead to greater purchasing power in these pockets. With a wider distribution of
population across these cities, the localization of news content will have a strong
market.
43. The literacy levels of the population is growing not only in terms of education but
also in terms of being technologically-savvy. There has been rapid penetration of
the internet, even into rural areas. This gives a potential for another form of news
delivery i.e. via the internet.
4. The large no. of Indian languages provides an opportunity for regional players to
come up. Approximately 60% of the Indian population has language barriers.
Thus the need for regional content development is high.
As the above are emerging and unaddressed needs, we stress that this translates into a
higher bargaining power for the consumer, as there is a possibility of them defecting to
substitutes.
Economic Trends:
India's high growth shall lead to increased economic prosperity and decreased price
sensitivity. This will translate into a market for customized news channels delivering high
premium content based on lifestyle, fashion and career opportunities. Also, the demand
for emerging economic opportunities in different economic sectors and geographical
areas shall increase.
Development trends
1. There is an increased health consciousness and emphasis on spirituality. These
create opportunities to deliver content on health and food habits, exercises, on
different forms of spirituality and the like.
2. With an increasing western influence, there is an information need regarding
fashion changes, a need to address the need of the youth, who are the main targets
by providing them localized information of hangout places etc.
3. There has been greater focus on sensationalism while reporting current events,
crime, politics and entertainment news.
The above factors all indicate that the consumers of content have a significantly high
bargaining power with respect to the news channels.
B. Buyer Power (the advertiser)
The advertiser's objective is to use the news channel as a medium to convey his message
to the people. Hence it is essential that the channel audience should match with the target
audience of the advertiser. Regional channels show regional brands while on national
channels, the largest advertisement expenditure is by business-related advertisers.
If the news programs remain relatively undifferentiated, the bargaining power will be
high for the buyer. However, with differentiated content, the firm will gain power. The
reach of the news channel maybe of two types - geographic and segment-based. A large
geographic reach may not translate to higher revenue if the programs are undifferentiated.
5Similarly, even segmented news market providers may not have high bargaining power
due to limited geographic reach.
Suppliers
There are two sources of information - content providers and self-developed content. The
content providers have little influence on the strategy of a player. This is due to the large
investments that firms have been making in increasing the infrastructure required in
content-development. Thus the bargaining power of external suppliers has been
decreasing.
Threat of Entry
Considering barriers to entry, we have the following:
Economies of Scale: Economies of scale maybe realized by increasing the network of
journalists to expand to all parts of the country. This translates into an entry barrier. Due
to limited talent and scarce distribution bandwidth, it is not easy to expand the network at
low costs. Networks may hence share resources through tie-ups in the industry, for e.g.
North and South Indian channels may share content.
Product Differentiation: Almost all news channels develop content in all sub-genres.
There is however a difference in the presentation, little differentiation in the analysis of
news. A new entrant has to develop content and style well-differentiated from existing
players to avoid being dismissed as a clone.
Capital Requirements: The main startup costs include those of infrastructure and
licensing. These are relatively low (Rs. 50 crore), but the working capital requirement is
high (approx. Rs. 100 crore/annum) to run the channel. However, this is not a high entry
barrier.
Switching costs: A determinant of the switching costs is the consumer behavior. With
rapid channel surfing, switching costs for consumers is low. However switching costs are
likely to increase with the higher level of involvement of the consumer and the more
interactive news portals coming up.
Government policy: Government policy restricts Foreign Direct Investment to 26% in
the media industry. This has prevented many international media houses from entering
India restricting the adoption of new technology and methods to increase operational
efficiency. However, this trend is likely to change.
Threat of Substitutes:
The major substitutes are the alternate media for news delivery. These include the
internet, the print, radio and now, even the mobile phone.
6Internet: With increasing computer-literacy levels, the internet penetration is likely to
increase. Furthermore, the massive growth rate in the usage of the internet and its vast
repository of information, coupled with the ability to provide more interactive and
customized news makes it a strong substitute. However, until traditional news delivery on
the internet includes real-time multimedia it is unlikely to compete directly.
Print media: This has the largest penetration and is a mature market. It caters to all
segments and is relatively stagnated. To complement the competencies in the print media,
some media houses (like Living Media) have diversified into the news channel genre
through acquisitions (of Aaj Tak and Headlines Today).
Radio: Currently regulations do not allow private radio channels to air news content.
Intensity of Rivalry among Existing Competitors
News-reporting faces extreme competition. If a channel delivers news even a few
minutes later than a competitor it will be viewed as inefficient.
The industry is expected to grow at approximately 50% per year. This has attracted a
number of participants, both at the national level as well as at a regional level, along with
channels catering to sub-genres. Crowding is likely to occur, which shall result in
consolidation within the industry, with integration of media houses providing a bouquet
of channels catering to various segments. Networks are also introducing targeted segment
channels just as NDTV has expanded by creating NDTV Profit.
The industry doesn't have high fixed or storage costs, unlike manufacturing industries.
Capacity augmentation can be done through increasing the network of journalists, as
these are the most important resource. There is fierce competition for talent due to
scarcity of quality journalists. Hence there is rampant poaching, which increases the
intensity of competition within the field.
Diverse Competition: Diversity is present in terms of different geographic reaches -
with both national and regional channels. There is also diversity in the types of genres -
varying from general news to business. Diversity thus increases the opportunity for
creating of niches and hence the competition is likely to get tougher.
Positioning of channels: Consumer perception varies from channel to channel. This is
probably due to the format that the news channels adopt in the presentation of the news.
For e.g. NDTV is viewed as being a very serious news channel. Similarly, CNN-IBN was
earlier viewed as being an NDTV clone, but has been able to progressively carve a
unique identity, by taking journalism to the grassroots and having its correspondents
actively participate with the common people while reporting. Similarly Times Now
focuses on breaking news, whereas Star and Aaj Tak on sensational news. Headlines
Today, is positioned to cater to the urban, affluent income group society.
7Governmental regulation: There is currently no cap on advertisement time. However,
with the introduction of CAS and DTH, and generation of revenues from subscription, it
is possible that the government imposes a cap on the advertising space. This will increase
the level of competition in the industry.
Market Trends
Potential growth in ad revenues: The primary source of revenue for news channels in
India is advertisements. Since 1990, the share of advertisement revenues in television as a
percentage of total advertisement expenditure in India has been on the rise by capturing
of the print media share. In 1990, the ad share of print media as a percentage of total
advertisement spend in India was 70%, which declined to 51% in 2002, while during the
same period, the share of television in total ad spend in India increased from 16% to 41%.
India's advertisement expenditure as a percentage of GDP was a mere 0.4% in 2002
which is very low and can be expected to rise. (Equitymaster.com, 2004)
Present and potential competition: Competitors have the potential of eating into the
market share, especially in the English news space. This has already been witnessed by
Aaj Tak which was the leader in the Hindi news segment. Though the broadcasting
industry was growing, TV Today's market share in the Hindi news genre in terms of
viewership declined from 54% in 2002 to 32% in 2004, due to increased competition
from new Hindi news channels like NDTV India, Star news and Sahara Samay. Loss of
market share to competitors will have a negative impact on the profitability. Competition
is likely to grow with the entry of new players into the news broadcasting industry and
existing players consolidating their positions.
Threat of lack of differentiation: News being non-proprietary and largely non-
exclusive results in the content being similar across news channels with key
differentiating factors being speed, editorial quality and presentation style. As the
competition increases, it could be increasingly tough for a news broadcasting company to
adequately differentiate its news channels on a continuous basis. Thus, any change in
preferences of viewers or other related factors such as increased competition, may have
an adverse effect on the viewership of the company's channels thereby affecting the
growth prospects of the company.







8NDTV

Brief Background
NDTV is one of India's leading broadcasters and producers of news and current affairs
programmes. The company was started in 1988 by Prannoy Roy as a television
production house and debuted with The World This Week, an international news program.
(See Exhibit 1). The timing was extremely conducive. NDTV's coverage of Tiananmen
Square and the fall of the Berlin Wall was path breaking in Indian television reporting
and gave it instant brand recognition. It was given a slot for a daily news bulletin and big-
name sponsors, such as the Tata Group came forward for financing. Additionally, BBC
and Star TV who wanted to expand their India offerings also turned to NDTV for content.
Exhibit 1:NDTV's Corporate History


Source: Ndtv.com, (2007)
NDTV's big moment came in 2003, when they withdrew from a five-year contract with
Star News to launch their own channel. The infrastructure and people were in place, and
with the Roys' well-known name, there was no shortage of financial backers.
Still NDTV had to struggle to get its channels seen. As a newcomer, NDTV had no
option but to pay up fees to the cable operators so its channels could get desirable spots
9on the dial. Finally, in April 2003, NDTV 24x7 (English) and NDTV India (Hindi) were
on the air. Within a year of its launch, NDTV managed to become the leading broadcaster
amongst all the news channels in the country on the basis of Cable and Satellite
viewership.
Current Performance

Though NDTV has high recognition and great potential considering the current market
trends, its performance in monetary terms is still small - $43 million in revenue for the
year 2006 ending Mar. 31 and a $7 million operating profit. (Forbes.com, 2006)
Data from January 2007 shows that NDTV 24x7 holds a commanding 30% share of the
English news market. (Exhibit 2) However NDTV was higher at 38% in 2004 and the
entry of new players has caused this decline. In 2005 NDTV launched NDTV Profit, a
business-news channel that has gained enough mileage to compete with CNBC-TV18,
the category's long-entrenched leader. Together, NDTV's three channels reach 56 million
viewers.
Exhibit 2: Market Share 2006-2007

15 15 AUG
15 SEP - 15OCT- 15NOV- 15DEC-
GENRE / CHANNEL JULY - - 15 01JAN - 13JAN 07
15 OCT 15NOV 15DEC 30DEC
15 AUG SEP
ENG NEWS - TG: CS AB 15 Years +
Market: HSM
BBC World 0 0 0 0 0 9 5
CNN 8 0 0 0 0 0 5
CNN IBN 23 30 30 27 33 18 20
Headlines Today 15 10 10 9 11 9 15
NDTV 24x7 38 40 40 36 33 36 30
Times Now 15 20 20 27 22 27 25

Indiantelevision.com, (2007)
Strategies followed by NDTV
When NDTV split from Star TV in 2003, Aaj Tak was the undisputed leader in the
television news industry with a huge 60 per cent share of the market. In the one year after
its launch, NDTV's 24x7 had emerged as the leading English news channel, though Aaj
Tak was still ahead of NDTV in the Hindi news space. (See Exhibit 3) About 60 per cent
of NDTV's revenues come from the English channel. At TV Today (Owner of Aaj Tak),
however, 95 per cent of its revenues still come from Aaj Tak and the English service,
Headlines Today is a small player. (How NDTV turned…, 2004) The entry of new
players has increased the market but at the existing news broadcasters have seen their
market share decline.


10Exhibit 3: Market Share in 2004


Source:Equitymaster.com, 2007

NDTV's 24x7 Phenomenal growth to position of Market Leader
Reputation & Understanding of the market
The promoters of NDTV, Prannoy Roy and Radhika Roy, had significant experience in
the field of content production, news delivery and journalism. Thus they had a strong
understanding of the television industry business with all its finer aspects. NDTV had an
excellent reputation for providing quality content even when they produced "The World
this Week" for Star TV.
Successfully associated itself with the biggest news events
Another reason why NDTV was so successful in the year of its launch can be attributed
to the elections and the budget of 2004. For the media, the 2004 General Elections was a
watershed election. This election was the most widely televised election in Indian history.
However NDTV was the first to realize the opportunity and through its extensive
coverage became synonymous with election and budget news.
Elections by then also provided a great source of commercial revenue for news channels
- one of the reasons why NDTV showed good results right in its first year. Advertising
and sponsorships during the election campaign period touched Rs.170 crores with NDTV
India charging up to 400 times its usual rates (The Hoot…, 2004)
Differentiated Content
NDTV's main competitor at the time of its entry was Headlines Today (Aaj Tak family).
HT stayed sharply focused on 'as it happens' news and specifically targeted the upper
income segment through "softer" journalism featuring sports, fashion, lifestyle and
bollywood. NDTV's differentiation content was its hard-hitting journalism and focus on
11innovative content such as current events and socially relevant programmes like The Big
Fight, Walk the Talk and We the People. NDTV also had a judicious mix of analytical
and speed news. They kept their in-depth, analytical features for the evening slots and
weekends and concentrated more on speed news in the day, to update viewers quickly on
the latest happenings.
Effective distribution
During the initial few months of its launch in April 2003, the NDTV channels were not
available on the prime band in most parts of the country. NDTV sorted out the
distribution issues by paying carriage fees to cable operators and this has now become an
industry standard.

Projected anchors as celebrities
Another strategy which worked for NDTV was that of pushing its anchors as stars.
Television news industry is a people-centered profession and good journalists, can strike
a rapport with the viewers. Most of the anchors on NDTV have grown with the channel.
Benefits of entering the industry early

One factor that has conferred certain competitive advantages to NDTV is its market entry
timing. Though technically not the first 24 hour English news channel devoted to Indian
news, it was the pioneer before the wave of channel expansion broke out. Some of these
advantages include building of reputation and key relationships with distributors,
switching costs for consumers, technological leadership and strong journalistic talent.
One of the most significant behavioral factors that confer an advantage on the first mover
in the news industry is the ability to preempt the perceptual space. Since television-news
viewers in India were only exposed to Headlines Today, NDTV 24x7 has to a certain
extent influenced their perception regarding what a "journalism-driven" English news
channel featuring Indian news should be like.

However being the first mover has not ensured a long term competitive edge for NDTV
as can be seen from the success of CNN-IBN and Times Now. Since the experience of
watching television is characterized by continual channel surfing, it is to be expected that
people would surf through other channels for further content on news that interests them.
In such an environment quality, in-depth content and talented anchors can help maintain
viewer retention.
Strengths
Experienced promoters and renowned team: Apart from the reputed promoters, the
company has a renowned team of quality journalists with some of the most recognized
faces in the Indian television news industry, which is an important asset for the company.
12Extensive reach and market share: As cable penetration in the country is expected to
increase and NDTV has the widest reach (both the channels combined) amongst news
channels in the country, it provides a good platform for advertisers to showcase their
products to a wider audience, consequently leading to better ad revenues.
Opportunities
Alternative revenue models: The NDTV channels are currently free-to-air (FTA) with
almost 90% of the company's revenues contributed by advertisement revenues. However,
with the implementation of new delivery modes like head-end in the sky (HITS), direct-
to-home (DTH) and conditional access system (CAS), the company is likely to explore
subscription business as an alternative source of revenue. Currently the two NDTV
channels form a part of the 'One Alliance', a distribution bouquet of channels that also
includes Sony, SET Max, AXN, discovery, HBO and Animal Planet channels. According
to FICCI-KPMG Report, the Indian subscription revenue market is expected to grow to
approximately Rs 72 bn by 2007 from the current Rs 12 bn and this offers NDTV an
attractive alternative stream of revenue. This indicates the potential for subscription
revenue business in the country.
Going Global
Taking NDTV global seems to be on the agenda for this network. The network's
channels have a growing overseas audience among the NRIs in the U.S., Canada, the
U.K., the Middle East and South Africa, through deals with satellite operators, such as
BskyB and DirecTV. To accelerate the global push, NDTV formed a joint venture with a
subsidiary of Kuala Lumpur's Astro All Asia Network, with 20% stake. It will offer 24-
hour infotainment channels on satellite in different Southeast Asian countries. In June
2006 it debuted with Astro Awami, a Bahasa-language channel in Indonesia.
Challenges
Differentiating itself from competition
To avoid being merely another broadcaster, NDTV has to continually evolve its
programming content and format. NDTV was the first broadcaster to explore non-news
programmes, interactive shows ad opinion polls such as "You Decide". However with 40
odd channels competing for eyeball space, NDTV has to look at more interactive
programs and content different from that present with competitors.
Distribution
In its quest for expansion, NDTV has to compete with other broadcasters for the
extremely limited bandwidth left. The biggest challenge for any news channel is to have
its distribution in place to reach maximum households.
Retaining talent
13NDTV in order to maintain its reputation of quality journalism has to ensure that it
retains its talent. A collegial culture and generous employee benefits have attracted some
of the best in India's television industry. But competition is intense with new players
raiding its 1,200-member staff and poaching key people. Former NDTV managing editor,
Rajdeep Sardesai co-founded CNN-IBN and appears as an anchor. Times Now, a joint
venture between Reuters and the Times of India Group, also has Arnab Goswami, an ex-
NDTV staffer as editor-in-chief (Times NOW CNN-IBN ready.., 2005)

.
14Strategic Analysis of Competitor CNN-IBN

Introduction

CNN-IBN was launched in 2005 by Rajdeep Sardesai after he quit from NDTV. The
network is a partnership between TV18, Global Broadcast News (GBN) and Turner
International in India.
In a little over a year since its launch, it has managed to make a strong mark for itself. Its
brand licensing and news services agreement with CNN and Turner appears to have
helped it capture viewer attention.
The channel scores high in terms of news coverage, presentation style and quality of
news and offers some serious competition to NDTV 24x7. Being led by Rajdeep Sardesai
who has a huge following in India with years of expertise is one of the primary drivers of
its growth. From TAM Viewership data, the channel appears to be neck-to-neck with the
latter in terms of market share (TAM viewership, 2007). The channel has decided to turn
pay from free-to-air which offers an additional stream of revenue by way of subscription.
But the contribution from subscription will be significant only if the conditional access
system (CAS) takes off and investors consciously opt for new digital platforms.
CNN-IBN has styled much of its content on NDTV but does have a few innovative
programs. It is the first news channel in India to have developed the concept of "Citizen
Journalist" where any person can send in his report to the channel which is aired in a
separate section.


Current strategy

Based on the telephonic interview with Rajdeep Sardesai, the following insights about
their current strategy of CNN-IBN are apparent. Their current strategy is three pronged.
They are now focusing on
1) Hard news journalism: This is the most important element of their strategy.
They plan to differentiate themselves from the other news channels through the
quality of journalism. They invest time and resources in following up a story to
investigate the truth. This could mean months of investigation. It also involves
citizen journalism where the common public can report a story which can
subsequently be followed up by CNN-IBN. The Air-Deccan report is an example
of this.
2) To report all relevant news: They want to ensure that the news they report is not
limited to just breaking news and is not politics or Delhi centric. They focus on
having programs in tune with people's concerns.
3) More interaction with audiences: They encourage correspondents write blogs
which receive feedback. Web casting allows the audience to choose the content
they want to watch. They also use mobiles to allow audiences to indicate their
views through opinion polls etc.
15Future strategy

Based on the interview with Rajdeep Sardesai, the following facts about the future goals
of the channel were unearthed.

Regional Languages

The future goals of the channel include entering regional languages. Not only does this
bring in new revenue, it is also likely to help ease the talent shortage they are currently
facing and increase the reach of the network as well. They plan to synchronize operations
with the mother ship feeding the other language channels.

Move to Subscription

They plan to increase the percentage of revenue from subscription to a large extent. They
are looking to increase the percentage of revenue earned from subscription from the
present value of around 2% to nearly half of the revenues. Regarding the web site the
planned model is 60% subscription and 40% advertisements. To achieve this strategy
they are actively promoting CAS and DTH technologies

Assumptions

CNN-IBN claims to provide better quality journalism than the others. They also believe
that DTH and CAS will play a very critical role for future growth and that these
technologies are crucial to increase revenue growth from subscription. Formal tie ups
with print media are not on the agenda. They also believe that the growth of the Indian
economy will sustain robust growth in advertising revenue over the long run. Integration
of Web and TV is expected by them in the future and they are gearing to take advantage
of such improvement in technology.

Possible Offensive moves by CNN-IBN

1) Introduction of news channels in regional languages
2) Acquisition/Tie ups with regional news channels
3) Focus on investigative journalism and possibly sting journalism. This is in line
with their main goal of hard journalism.

Defensive capabilities

1) Since they believe that formal tie-ups between print and TV media are unlikely,
they are unlikely to be on the lookout for such opportunities. If competitors are
able to form formal alliances with print media this would give them a first
mover's advantage. They might be able to improve quality of content and reduce
costs by co-operating on content generation.
16Strategic Analysis of Competitor - Headlines Today

Introduction

Aaj Tak, TV Today's half-hour daily news and current affairs programme on
Doordarshan was started in 1995 and grew to become the most watched news and
current-affairs programme in the country. Aaj Tak was launched as a 24-hour Hindi news
st
channel on 31 December 2000 in line with the group's mission of providing a complete
media platform. Aaj Tak established itself as India's number one news channel within
months of its launch, dethroning established players.

In April 2003, TVTN launched India's first 24-hour English news channel - Headlines
Today. In a short period of time, Headlines Today emerged as one of the leading English
news channels of the country registering tremendous growth in both viewer reach and
market share. However the entire English News market was small then and the eventual
entry of competitors has caused HT's market share to decline alarmingly.

Past & Current strategy

Initially Headlines Today's key value proposition to the viewers was that it commanded
the same editorial strength but delivered it 24-hours to its viewers. In time, as competition
grew, 24-hours ceased to be a differentiator in the news genre. Aaj Tak, developed a new
positioning, centered on the concept 'Sabse Tez'. In September 2004, in another
desperate attempt Headlines Today launched a campaign 'News, crisply told' to
communicate the brand values of the channel and started the slogan 'Sharp news for
Sharp people'.

TV Today's strategy for Headlines Today has been to focus on a predominantly urban
and time-constrained audience. Headlines Today also targeted the urban households as
well as the Southern market in a big way. The channel has also traditionally kept its
advertising charges low unlike its competitors.

An analysis of HT's fall reveals that the channel focused exclusively on presentation and
format rather than content. The success of a news channels depends more on its back
office journalism quality - newsreaders at HT did not have the ability to elevate the
channel to the level of NDTV.


Future strategy

17Headlines Today's future strategy seems to continue more or less on the same lines as it
is now -to focus on the affluent urban youth. Thus we have the extra emphasis on
Bollywood, sports, fashion and page 3 celebrities. However HT needs to do some drastic
revamping of its competitive strategy in order to able to compete with the current big 3 -
NDTV 24*7, CNN IBN and Times Now. In advertising, the company's strategy is to
have one combined rate card for Aaj Tak, Headlines Today and Tez.

Possible Offensive moves by Headlines Today

HT focuses on "hot news" and presentation. Its current focus is only on the metros. As
the population in the Tier 1 and Tier 2 cities become more cosmopolitan, it is likely that
HT may focus even on these cities. This will be an offensive move against the strategy of
NDTV and CNN-IBN, to capture the same.

Vulnerability

As the target viewer is the urban, affluent Indian, it faces little unique competition.
However, if other channels increase their offerings through newer, innovative programs
targeted at this same segment, Headlines Today may turn defensive. As it caters to a very
small audience, and as the switching cost for a viewer is nearly zero, hence, HT is very
vulnerable.
18Strategic Analysis of competitor - Times Now

st
Times Now, a 24 hour news and current affairs channel was launched on January 31
2006 by Times Global Broadcasting Company. It is part of the strategy of Times group to
be present in every relevant sphere of the urban Indian's news space (Times Now.tv, n.d.)

It is a digitally encrypted pay service channel. In sync with its tagline of "feel the news"
it plans to have multiple channels including the web and mobile.

Sunil Lulla, the CEO of Times now, has been associated with TV for over 2 decades and
his strength lies in building brands from scratch.

Assumptions

They believe that there is space for many more channels. They expect that in the next 3
years there will be about 250 million homes with television, of which 71 million would
have cable and satellite TV. Further about 30 million of these would be in the urban
homes. Their view is that there is room for around 300 more channels in the future and
hence there is no question of overcrowding in the industry (Indiantelevision.com's
interview.., 2007).

Future Goals

They plan to grow organically and inorganically in the future. Hence M&As are a
possibility.

Further they believe it is more important to deliver more value than the other channels.
Hence they would rather have one good quality priced channel than a bouquet of 10
ordinary channels. Financially they expect to break-even in the next 4 to 7 years.

Current Strategies

They are currently targeting the urban audience specifically. As per TAM survey Times
now has now emerged as the most watched news channel by India's affluent sections,
even though they are well behind the leader in the overall segment. They also plan to
launch entertainment based shows on weekends and a sports show "the game". Currently
they have a budget special show. These moves are in line with their strategy of being
present in every relevant sphere of the urban Indian's news space. They have focused on
distribution and the channel is available on all platforms - cable, set-top box, DTH and
mobile.





19Current capabilities

Times Now plans use of the content from The Times of India, the Economic Times and
Reuters along with its own content. It is the only Indian broadcaster to carry live financial
updates throughout the day from Reuters bureaus around the world.


Future Strategic moves possible

Offensive moves

Times now could expand through mergers and acquisitions in the future (Asiamedia:
India, (2007). They believe that they attach more importance to quality of content than
the other channels. Hence unlike CNN-IBN, they are less likely to launch more news
channels. Further this is in tune with their strategy of targeting mainly the urban
audience.



20Conclusion

From our research and interviews with key television personalities, we have developed a
strategic analysis of the industry and its competitors.

Some learnings regarding the industry

There are two phases to gaining viewership - the first phase is capturing the viewer and
the second is retaining him/her. While capturing attention and thrusting the particular
channel or show into the viewer's consideration set forcefully is important, at the end of
the day, it is all about retention. And retention is driven by the quality of journalism,
innovative content and delivery of the promised USP
TV is an extraordinary medium where a single individual can become a brand and drive a
channel's viewership. That was witnessed when Prannoy Roy left Star India to launch
NDTV. Whereas Star News had been running up losses since its launch, NDTV was out
of the red in its very first year. History seems to be repeating itself with Rajdeep Sardesai
quitting NDTV to create CNN IBN, which again is a clear winner.
New players have fired up existing ones. CNN-IBN's launch has resulted in NDTV
creating new shows and innovative specials. It has also resulted in better pay packages
for journalists so that they cannot be poached away. Surprisingly however, increased
competition has not improved quality. When a big story breaks there are too many
versions, competitive sensationalism, tabloid style reporting and insensitivity to victims
and viewers.


Key Elements of a Successful Strategy in the Television News Industry

Understanding of the business

To start a news channel it is important that the entrant has understood the television
industry business with all its nuances. News, as a genre, is very different from any other
television genre. Because news is news only when it is on time, the speed of delivery is a
critical factor. The infrastructure requirements, the production costs, the competition and
the sources of revenue - all of these are different from any other television genre. So to
start a news channel it is important that there is an accurate evaluation and analysis of the
news market and its potential. All the successful news channels have had very
experienced and dynamic leaders at the helm who had years of expertise in the industry.

Understanding Viewers Needs

A viewer demands three basic factors - accuracy and reliability of news, timeliness of the
news and news when he wants it. But over and above, it is the "zing" factor of the
channel - in terms of presentation, content and interactivity - which will keep the viewer
addicted. Viewers should perceive a consistent difference between the company's
21programmes and its competitors - either in terms of anchors, content, presentation style
or focus.

Unique Positioning

The market for the news broadcasting channels in India is fragmented and a successful
player has to be clear about its target audience and its positioning. Each news channel has
set for itself a unique style of presenting news, which has become its unique selling
proposition. For example, Aaj Tak follows a different format of programming wherein
fresh news is given as well as a variety of news on an hourly basis. Times Now
concentrates on being the "first to break" important news while NDTV focuses on in-
depth analysis and its non-current news programmes. CNN-IBN positions itself as
delivering hard news which have high "impact".

Dynamic Anchors

Anchor driven news programming was created by NDTV - Prannoy Roy, Rajdeep
Sardesai, Nidhi Razdan and Barkha Dutt carried the channel on their collective shoulders.
CNN-IBN's entire success can be attributed to Rajdeep Sardesai who created a cult
following during his time at NDTV. For a channel to retain its viewers, it has to ensure
that its anchors have the personality and dynamism to bond with the viewers. The
addictive quality of a show is what keeps viewers coming and that hinges squarely on the
quality of the anchor.























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