0ff3c media ownership1.pptx

Name of Institution

Media Ownership

Who owns the media?

Name of InstitutionOwnership patterns

• Individual• Partnership• Corporation• Employee ownership• Trust/society owned• Government owned

Name of InstitutionOwnership patterns

• Vertical • Group or chain ownership• Joint Ownership

Name of InstitutionKey Trends

• Dominance over specific markets by a few players …markets are often oligopolistic in character.

•  The absence of restrictions on cross-media ownership implies that particular companies dominate markets

Vertically horizontally diagonally• Political parties and persons with political affiliation

own/control increasing sections of the media in India.

Name of InstitutionThe mediascape in India

• Indian media market differs from those of developed countries…highly fragmented, due to the large number of languages and the sheer size of the country

• Proliferation of publications, radio stations, television channels, and internet websites

Name of InstitutionDelhi Market

• Print publications - 82,000 publications registered with the Registrar of Newspapers as on 31 March 2011

• But in a market like Delhi…16 English NPs…top 3 publications – TOI, HT, ET account for 3/4th of total market for all English dailies.

Name of InstitutionIndia vs. Others

• Countries like US, UK, France, Canada have a free press but there are restrictions on ownership…in India, no restrictions

• Most conglomerates have subsidiary companies….need to place restrictions not on “companies” but on “entities” such as BCCL

Name of InstitutionOwnership Restrictions

• Indian media cos. Have protested attempts to restrict ownership…Govt has played along

• Report by ASCI: Ample evidence of market dominance in specific media markets. In favour of “appropriate” regulatory framework to enforce cross-media ownership restrictions, especially in regional media markets where there is “significant concentration” and market dominance in comparison to national markets (Hindi and English media).

Name of InstitutionKey trends

•  The promoters of media groups have traditionally held interests in many other business interests and continue to do so, often using their media outlets to further these.

•  Growing corporatization: Large industrial conglomerates are acquiring direct and indirect interest in media groups.

• Growing convergence between creators/producers of media content and those who distribute/disseminate the content

Name of InstitutionOther business interests

• Promoters of media companies have subsidiary business interests in varied sectors.

• For eg,Dainik Bhaskar group, which, in 1958, ran a single edition Hindi newspaper from Bhopal, has a market capitalization of Rs 4,454 crore (as on July 30. 2010), owns seven newspapers, two magazines, 17 radio stations, and has a significant presence in the printing, textiles, oils, solvent extraction, hotels, real estate, and power-generation industries.

Name of InstitutionSo what?

• Boards of directors of a number of media companies now include/included representatives of big corporate entities that are advertisers.

• Emphasis on botttom-line rather than byline

• Paid news and private treaties

Name of InstitutionJagran Publications

• MD of Pantaloon Retail, Kishore Biyani• McDonald India’s MD Vikram Bakshi• Leather-maker Mirza International’s MD

Rashid Mirza• CEO of media consulting firm Lodestar

Universal India, Shashidhar Sinha,• Chairman of the real estate firm JLL

Meghraj, Anuj Puri

Name of InstitutionHT Media

• Former chairman of Ernst & Young K. N. Memani

• Chairman of ITC Ltd Y C Deveshwar

Name of InstitutionDB Corp (Dainik Bhaskar)

• Head of Piramal Enterprises Group, Ajay Piramal

• MD of Warburg Pincus, Nitin Malhan• Executive chairman of advertising firm

Ogilvy & Mather, Piyush Pandey.

Name of InstitutionWhy media consolidation?

• Economies of scale by spreading costs of production and distribution and “rationalizing” the utilisation of resources.

• Convergence of media, telecommunications, and computing technologies has also blurred the distinctions between different media.

Name of InstitutionImpact on democracy

• Growing concentration of ownership in an oligopolistic market that could lead to loss of heterogeneity and plurality

• Growth of internet vs. shrinking in the number of traditional media operations in TV and print

Name of InstitutionThe rationale

• Vertical integration can result in anti-competitive behaviour, whereby a distributor can favour his/her own broadcasters’ contents over the content of a competitive broadcaster. In this scenario, large conglomerates would be able to impose their preferred content, a clearly dangerous situation.

• Already disputes between broadcasters and cable operators alleging denial of content by other service providers: TRAI

Name of InstitutionMedia consolidation

• January 2012, the Mukesh Ambani-led Reliance Industries Limited (RIL) – India’s biggest privately-owned corporate entity with a turnover of Rs. 2,58,651 crore – announced that it was entering into a complex, multi-layered financial arrangement…involved selling of its interests in AP- based Eenadu group founded by Ramoji Rao to the Network 18 group headed by Raghav Bahl and also funding the latter through a rights issue of shares.

• The deal will make the combined conglomerate India’s biggest media group, according to Bahl -- bigger than media groups such as STAR controlled by Rupert Murdoch, and BCCL controlled by the Jain family.

Name of InstitutionRecent Examples

• Horizontal: Co. which publishes Dainik Jagran took over co. which publishes Nai Duniya

• Vertical: Rupert Murdoch-led STAR group controlling cable distributor Hathway, the Zee group controlling DTH satellite channels provider Dish TV, and the Sun group controlling cable distributor Sumangali.

Name of InstitutionRecent Examples

• Diagonal – Eg: strategic association between a telecommunications company and a media company to use common infrastructure

• Two recent examples are: (a) the strategic association of Reliance Industries Limited (RIL), India’s largest corporate entity in the private sector, with the Network 18 and the Eenadu groups and (b) the Aditya Birla group acquiring a substantial holding in the Living Media group.

Name of Institution

• May 2012, the Aditya Birla group announced that it had acquired a 27.5 per cent stake in Living Media India Limited, a company headed by Aroon Purie. Living Media acts as a holding company and also owns 57.46 per cent in TV Today Network, the listed company that controls the group’s television channels (Aaj Tak and Headlines Today) and a host of publications (including India Today).

• December 2011, Oswal Green Tech, formerly Oswal Chemicals & Fertilizers, acquired a 14.17 per cent shareholding in NDTV in two separate block deals from the investment arms of Merill Lynch and Nomura Capital.

Name of InstitutionConcerns

• With larger television broadcast networks, including Zee, Turner/CNN, Viacom/MTV and Sony, expected to acquire/partner regional networks, the commoditization of news seems inevitable

Name of Institution

Ends!

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