2005 comes to an end, professionals in the media sector
must be rubbing their eyes in disbelief looking at the numbers
springing up from their financial spreadsheets. 2005 has
been a windfall for ad, marketing, and television mavens
- in fact the best in five years.
buzz in the business at the beginning of 2005 was that the
double digit advertising growth of 2004 would not be replicated;
2005 would be relatively staid. TV and Print, which together
attract more than 85 per cent of the ad industry spends,
would have to strain to keep up the momentum.
can't forget that 2004 had serious dollars coming into the
ad sector via cricket especially with the Samsung Indo-Pak
series in Pakistan and the general elections. As compared
to those ad agglomerating properties, the event lineup for
2005 looked rather unimpressive.
with such a bleak scenario, the big question at the beginning
of 2005 was how would 2005 finally turn out? Where would
the growth come from?
creased brows and worrying were misplaced. For growth has
come and how! Lets
look at the key developments that occurred in the year and
drove the business in revenue terms
General Entertainment Channels:
A tale of two Ones and also of the Big
B and an Idol
Channels: They continued to sprout and rise
Regional channels and Hindi
film shows and channels: Rate corrections
Press: It raced
ahead in growth impressively as compared to TV
share grew for newspapers as subscription share reduced.
The Mumbai Print War:
The Media War of the Decade which continues to date
with the Old Guard battling new and hungry players such
as the Hindustan Times and DNA.
May their tribe increase as they did during the year
to corner a larger share of newspaper ad revenues
and Radio: Record
impressive gains. Radio
ad revenue breached Rs 3 billion, Internet breached Rs 1
in all this meant a RECORD BREAKING YEAR FOR THE INDUSTRY!
Let's say Amen to that!
look at some the 2005 events and developments closely:-
A TALE OF TWO 'ONES', A BIG B & AN IDOL
general entertainment channels (GEC) scenario saw two relatively
new tyros sauntering in Star One and Sahara One.
Both tried hard to do new things and also new ways to lure
eyeballs. Woh Rehne Wali Mehlon Ki, The Great Indian
Laughter Challenge and Nach Baliye were deviations
from earlier programming formats. And they succeeded in
generating stickiness, roping in TRPs, which brought in
the big bucks, thereby helping the GEC category. Also for
the GEC, Amitabh Bachhan and Abhijit Sawant with KBC2
and Indian Idol attracted viewers and moolah as newer
and newer formats were tried by all three Daddies of this
game Star Plus, Sony Entertainment Television (SET)
and Zee TV, across the year.
NEWS STATIONS CONTINUE THEIR RISE...
channels have been the darlings of the television industry
for the last three years. Their growth both in viewership
and in revenue terms - has been a topic of many a debate.
This year as well we saw an improvement on that critical
industry component. News channel viewership share (Terrestrial
+ Satellite Audiences, 4 years-plus) went up from 5.4 per
cent last year to 6.5 per cent in 2005, whereas revenue
shares climbed to a new high of 11.9 per cent up from 10.3
per cent. Cheers to that!
CORRECTIONS IN HINDI FILMS & REGIONAL STATIONS
too long, Hindi film channels have been used by media planners
to bring down campaign CPRPs (Cost Per Rating Points). Historically,
film channels would be paid far less for their viewership
as compared to GECs. This is despite the fact that their
viewership at times comes close to or is even more than
the entertainment channels. Ditto for regional language
players, they were given short shrift in terms of rates.
saw a correction and rationalisation as both these genres
increased rates as well as inventory in select cases resulting
in improvements in their revenue shares. While the regional
channels share climbed from 20.4 per cent to 24.8 per cent,
Hindi film channels improved their revenue share by a healthy
40 per cent plus from a mere 3.7 per cent to 5.6 per cent.
GROWS FASTER THAN TV... AGAIN!
year press grew faster than television, a rare feat in the
15 years of private satellite television. No one believed
print could pull it off yet again. Some skeptics on the
TV side dismissed last year as a freak year.
Others felt that print had been lucky as it could net all
the election money in 2004; TV was left out in the cold
as political parties could not put out their commercials
on the electronic media.
print has done it yet again! And not only that, it has actually
managed to increase its distance from the TV growth rate.
This time there was no luck involved. A good strong economy
supported by the launch of micro editions, falling entry
cost outlays on print, movement of Small and Medium Enterprises
(SMEs) from classifieds into display advertising, edition
cost bundling, etc are just some of the reasons that propelled
the print growth rates
of the most significant stories in the media sector for
2005 was perhaps the Mumbai launch of Daily News and
Analysis (DNA) and Hindustan Times as the two
challenger dailies to The Times of India. In 2004,
the total worth (ad + subscription) of the Mumbai Newspaper
market was pegged at a whopping Rs 10.5 billion (as per
AdEx NRT-1)! Thats 12 per cent of the total Rs 88.6
billion industry. No wonder then that the fight for a share
in the Newspaper space of Amchi Mumbai is so
two new launches spurred the outdoor business in Mumbai
as all the players splurged heavily on hoardings, billboards
and ground events. They also brought in innovations in terms
of cover prices and subscription fees. One can see from
the NRT subscription estimates, the effect that the Mumbai
launches have had on a marginal rise in subscription revenues
for newspapers as a whole.
ADS GROW VIS-À-VIS CLASSIFIEDS & APPOINTMENTS
by sectors such as retail, property/ real estate and education,
newspaper display advertising revenues grew faster than
both appointments and classifieds. As a result, displays
share within newspaper ad revenues went up from 78 per cent
to 80 per cent.
SHARE GROWS FOR NEWSPAPERS AS SUBSCRIPTION SHARE REDUCES
2005 AdEx NRT Report finds that for newspapers, while advertising
revenues have been growing in double digits, the subscription
(or circulation) values are stagnating. As a result, the
ad share in 2005 improved from 58 per cent from last years
share of 54 per cent.
RECORD BREAKING GROWTH FOR AD INDUSTRY
industry's upping the growth rate to 14.1 per cent is clearly
a spectacular achievement! And the fact is that this is
genuine growth, and not something sparked off by a couple
of events - thus reflecting the mood in the economy.
14.1 per cent growth makes the advertising industry at a
healthy looking Rs 132 billion (Rs 13,200 crores). Thats
up from Rs 116 billion last year.
the radio, press and internet share of spends have increased
compared to last year, TV and out-of-home (OOH) have marginally
dropped. The drop in TV is primarily due to a slower growth
OUT OF THE OTHER MEDIA, INTERNET &
RADIO RECORD IMPRESSIVE GAINS
two minnows, Internet and radio grew the fastest in 2005,
albeit on a smaller base, outpacing everyone else. While
radio with a share of 2.4 per cent has grown by 44.5 per
cent; Internet with a 0.8 per cent share has grown by a
whopping 78.3 per cent. It should be mentioned here that
radio today earns more ad revenues than all the television
music channels put together!
AD REVENUE BREACHES Rs 3 billion, INTERNET BREACHES Rs 1
in India makes more money than all music TV channels put
together! And this equation does not change even if you
take All India Radio (AIR) revenues out
breaching the Rs 3 billion (Rs 300 crore) revenue mark,
the new launches expected with the new licence regime in
2006 assumes importance. At the same time this year, Internet
crossed the magical Rs 1 billion (or Rs 100 crore) mark.
you can see, the ad industry at Rs 132 billion, looks healthier
and plumper with an additional Rs 16 billion under its belt.
Largely driven by new advertisers and first-time advertisers,
it offers a lot of hope as well as food-for-thought to its
professionals as they step into 2006.
report has been compiled by AdEx India, a division of Tam
Media Research. The rates used are realistic market rates
obtained from the industry. AdEx India would like to Thank
a host of contributors who helped us put this report together.
They include our friends from TV channel companies, radio,
publication groups, media specialist organisations, Media
e2e, a Mumbai based Strategic Media Studies group and the
Internet And Mobile Association of India or IAMAI.)
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