Alternative Revenue Sources

for Mainstream Media

Dr. Mrinal Chatterjee

Professor
Indian Institute of Mass Communication (IIMC)
Sanchar Marg, Dhenkanal 759 001, Orissa, India
First the BIG picture
 Status of Media in India
• The Indian Media and Entertainment (M&E)
industry stood at US$ 12.9 billion in 2009
registering a 1.4% growth over last year*
• Over the next 5 years, the industry is
projected to grow at a compound annual
growth rate (CAGR) of 13% to reach the size of
US$ 24.04 billion by 2014.
• *A joint report by KPMG and an industry chamber.
 Media in India: present status
Print
• 74,000*+ publications | Daily circulation: 18 crore +
• Consider the growth:
– Number of Publications
• 1956: 4,569
• 2006: 62,483
– Number of Dailies:
• 1950- 214
• 1990- 2856
• 2006- 6800

» 74,409 as on July, 2009

Unlike in Western countries, print
media in India is growing.*
* IRS 2010 Q1: Top ten Hindi dailies see growth in readership
 Media in India: TV
• 134 million households (out of 223 mn) have
TV sets, of which over 103 mn have access to
C & S TV, including DTH subscribers.
• In Urban India, 85% of all households have a
TV and over 70% of all households have access
to Satellite, Cable or DTH services
• 23.77 mn DTH subscribers by June 2010
• TAM Annual Universe Update - 2010,
 Media in India: TV
• As of 2010, a total number of 515
channels are available in the country out
of which 150 are pay channels.
• According to the figures released by an
industry chamber in March 2010, the
Broadcast and Television (TV) sector
comprised over 43 per cent of the overall
M&E sector wherein the total size of the
television sector accounted for US$ 5.7 billion
 Media in India: Radio
• Radio: 300+ AIR stations | Coverage: 97%. 240
FM stations from 40 broadcasters across 90
cities. Reach of FM is around 24 % in urban
areas.
• Radio is expected to grow at a CAGR of 16 per
cent over 2010-14 and reach to a size of US$
361.4 million by 2014.
 Media in India: Telephone
• 671.69 Million telephone (landlines and mobile)
subscribers and 635.51 Million mobile phone
connections*.
• India has the second largest telecommunication
network in the world in terms of number of wireless
connections after China.
• The Indian Mobile subscriber base has increased in
size by a factor of more than one-hundred since
2001 when the number of subscribers in the country
was approximately 5 million to 635.51 Million in June
2010.
• *as of June 2010
 Media in India: Internet
• Internet: 8 crore+ internet connection*.
Growing broadband connection
*By 2010. http://www.internetworldstats.com/asia/in.htm
 Media in India: Social Media
• Booming social media
• Social Media reaches around 60% of the online
audience.
– Facebook: 22.1 million userbase
– Orkut 18.5 mn
– Ibibo 3.56 mn
– Twitter 3.14 mn
– Bharatstudent 2.95 mn
– linkedIn 2.95 mn
» ViziSense (till July 2010)
Media Economics
Where does media in India
get money to run?
 Print Media
• Advertisement
• Circulation
• Sale of waste material
 Television
• Advertisement
• Subscription
• Event partnership
• Sale of programme software
 Radio
• Advertisement
• Event partnership
• Govt. funding (for AIR)
 New Media
• Advertisement
• Event partnership
Commercial advertisement is the
major source of revenue for all
media now.
Dependence on Advertisement
is growing.
For 2 reasons
Why Dependence on Advertisement is growing?
Reason No. 1
• Content is largely free
Why Dependence on Advertisement is growing?
Reason No. 2
• Production cost is increasing
So what?
That makes advertisers
more powerful.
So what??
They can and increasingly
do exercise control.
So what???
 The basic structure and
prime objective of
mainstream news media is
changing.
Altruism and a moral universe have
been the ‘foundation’ of media.
That is being tampered with.
There is a paradigm shift

Watch the following cartoon

Watch this cartoon
 Media is increasingly
• catering to the want and not to the need.
• Becoming personality-centric, rather than
issue-centric
– Watch the following animation film
Media is increasingly

• losing its moral universe

So what?
 So, this..
• With business interest gaining more ground,
gradually what media needs is not readers or
viewers; but consumers for the products advertised.
This role reversal determines the content. Media no
longer needs people who would think, they require
zombies, who would only consume.
• Trivialisation of content leads to the decline of
serious content
• Skewed priority
• Disengagement with serious issues affecting the
society
 And this
• This trivialisation process is eating into the
vitals of healthy socialization process.
• It is stunting the humanizing process and
triggering a sinister dehumanising process. It
is promoting ‘I ..me’ culture. It is promoting a
shallow, ‘all body - no soul’ kind of existence.
It is a negation of what human civilization
stands for.
• There lies the big problem.
Why has media depending
on advertisement?
3 Reasons
• Survival
• Profit
• More Profit
Media business is peculiar.
 Peculiarity 1
• Unlike many other business, here the product
is usually sold far below the production cost.
 Peculiarity 2
• Usually the product has only abstract value
 Peculiarity 3
• The product has power to influence and
motivate, And it enjoys strong societal
acceptability and respectability.
Overdependence on big
advertisers will rob media off its
independence, credibility and
power.
 It does not make
good business sense either.
 It is time
to think about
alternative source of revenue
for media
That is a challenge and opportunity
New Revenue Model: A Paradigm Shift
• From limited revenue avenue to multiple
revenue streams
• From the tip of the pyramid to the bottom of
the pyramid
• From the space/time to content of media
 The goals are to ..
..form a dynamic, multi-revenue stream
business to support the editorial
department, as well as distribution
operations, and continue to provide a
tidy profit for media companies.
The New Revenue Mosaic can be made
up of a multitude of revenue makers.
The New Revenue Model Mosaic

• Subscription
• Paid Content
• Micropayments
• Production services
• Endowments
• Events and conferences
• Archives
• Grants
The New Revenue Model Mosaic
• Content networks
• Cross-media advertising
• Crowdfunding
• Reader donations
• New products
• Database mining
• Foundation
• Cooperatives
• Advergaming
• Product placement.
 The idea is to..

• Broad base the revenue earning source (some

call it ‘long-tailing’ by utilizing the USP of
media, and
• Innovative revenue collection ways
• Think about the ‘chota recharge’ of mobile phones or
pouch pack of shampoo, etc.
 Utilize the USP of media
• Content. Media content largely is free. The idea is
to sell it. This requires smart thinking.
• Media is a repository of information. The idea is to
utilize it and provide access for a fee.
• Media is a meeting point. It connects people. That
could be another revenue earning area.
 It is working elsewhere

• Some revenue models are emerging as hot

topics for media owners/managers such as
paid content and micropayments
• Consider how Facebook is making money.
 Road ahead
• Try selling what is good. There always is a
market for ‘good’.
• Try understanding the latent info-need. Cash
on that.
• Try innovative revenue matrix
• See how mobile companies are working
Finding alternative revenue streams
for media is possible.
It requires out of the box thinking and
smart implementation.
 Thank You
mrinaliimc@yahoo.in
www.mrinalchatterjee.in
91 94370 26194
Questions?