Wednesday, March 24, 2010

Can we ignore the money? The future depends on it

It is a well know fact that not so long ago Mr. Dhirubhai Ambani was a good friend of a certain Mr. Ramnath Goenka who owned the then & now well known Newspaper the Indian Express

However, the relationship between them soured and as the days passed by The Indian Express, a broadsheet daily published by him carried a series of articles against Reliance Industries and Dhirubhai in which they claimed that Dhirubhai was using unfair trade practices to maximize profits. Ramnath Goenka did not use his staff at the Indian Express to investigate the case but assigned his close confidant, advisor and chartered accountant S. Gurumurthy for this task.

In this time of trouble Dhirubhai Ambani did what only he could do. He took an entirely different approach to the problem and if anything decided to increase the ad spends of the Reliance group on the Newspaper. His thinking was that the publication would eventually get bogged down by the weight of the money spent on the newspaper. As it turns out Mr. Ambani suffered a stroke forcing the newspaper to turn their attention to the fallacies of the government & that ended the quarrel.

What would be interesting is what would happen if things were like that today. What if the situation was the same, & only the protagonists different? Let me explain….

Today the biggest advertisers in the Indian Media space are the Big FMCG companies. There is Reckitt Benckiser, P&G and the big boy HUL. But does anyone know who the fastest growing advertiser is? Or who is increasing their spends the most Y-O-Y.
Let me tell you, it’s the Government of India (GOI).

Think about it, it’s only logical isn’t it! They are the one “Company” that has as many “brands” as Unilever does (ministry of telecom, Ministry of forest, ministry of external affairs, ministry of family planning, ministry of infrastructure, and so on and so on) and as these ministries start to understand the potential of media their spends on Media are only going to increase right!

Let me share some numbers with you here. There are close to 7000 (yes, 7000) major government portals & websites providing government information to all internet users in India. After all of this, India is still ranked 113th on the United Nations e-governance Index (Source; the United Nations e-governance survey 2008)

With the government more eager than ever before to showcase their initiatives & policies and with the number of people getting on to the internet in India increasing rapidly Indian Media companies are in for a windfall of advertising from them!

In such a position will Indian Media companies be in a position to speak against the government? What will Newspapers do? How will News Channels react?
If the government spends 10-20 Crore on a News channel will the news channel still be in a position to speak objectively about the government & its policies?

For the journalist it’s the real deal. Commercialism v/s journalism! Who will win?

For now, you will think, obviously journalism right!! What’s all the fuss about?

But it’s not all that simple & straight forward. News broadcasting today is more than just reporting News. It is a industry. Scores of people work with News channels, their lives and livelihood dependant on it. More so, scores of people INVEST in News channels. It is a business and like any other business they expect the money to flow back in, twofold!!!!!

In the Indian scenario where the only source of revenue is from Advertising (subscription revenue is non existent in India) the BIG advertiser becomes all important. The Money he brings to the table difficult to ignore!!

The last count says that there are close to 110 News channels in India (including National & various regional languages). Many of these News Channels are small & region centric. They will value the Government money so so much more!! What is important is that will they be able to ignore it? And give unbiased commentary

TELEVISION NEWS media is one of the most important catalysts that have an invariably important role to play in shaping up public opinions, sentiments, and dogmas. Due to its vast intrusion in public life, it has the power of creating an enduring impact on society and culture of a region & also to SHAPE SOCIETY & ITS OPINION.

It is hence immensely important that the Media remain neutral and detached as they have a colossal responsibility to shoulder. The future of a potentially prosperous country is in their hands!

The road ahead will not be easy. How successful they will be in their endeavor, only time will tell…


  1. A very interesting article, especially considering I have seen both the sides! Completely agree with you dude!

  2. Interesting viewpoint wonder why Obama is not increasing advertising budget for Federal adds. Think about this GE owns NBC Universal & GE is a big political contributor so indirectly media companies in any country are either left, right or center. Government has to have some form of control over media to get majority poll.

    It would be a good add on if someone could find how new media companies are formed when either party looses control of the one they have control over just like you noted the case of Ambani & Indian Express am sure Mid day or something of that sort with modern views must have been born around the same timeline.

  3. Very well written Mayank :) Set me thinking...

  4. Great view point. I feel the GOI, some members at least, hold the media on a tight leash which is yanked too often. Democracy takes a backseat many times. Free Press is only a buzzword which vanishes when it comes to reporting government fallacies. Perhaps the power scales might tip in the favor of the people if we gotmore pro- active and expected good corporate governance from the GOI the same way we expect from the big MNCs