Regional TV channels may withstand disruption from NTO 2.0


NEW DELHI :

Viewers of regional television channels, who have been slow in transitioning to OTT (over-the-top) streaming content compared to Hindi-speaking audiences, could help broadcasters withstand the disruption caused by the new tariff order (NTO 2.0).

Given that NTO 2.0 places caps on channels within bouquets, broadcasters have moved key Hindi as well as regional channels out of bouquets and priced them a-la-carte at a 15-30% premium. While the price hike could accelerate viewers’ transition to streaming, media experts point out that the process is likely to take a few years for regional programming that has traditionally had higher recall and affinity.

“Broadcasters have adopted upward pricing for key channels, including in regional languages given that they already enjoy higher viewership. However, regional is a slightly safer space given that content on OTT in these languages is still coming up and has not reached the same levels as linear television,” said Mansi Datta, chief client officer and head, north and east, Wavemaker India, adding that audiences watching programming in these languages have greater affinity and loyalty towards television and migration to OTT will take time, a risk that is far higher for Hindi content. 

TVR (Television Viewer Rating), an estimate of audience size watching the TV programming relative to the number of reachable households or individuals or universe, is often more than five times higher for regions in southern India compared with Hindi-speaking markets, according to media industry experts.

The larger networks have smartly moved their key national as well as regional GECs (general entertainment channels) out of bouquets and priced them a-la-carte, implying that these channels will not be a part of any bouquet and customers will have to subscribe to them individually. 

“So, the total money that the consumers will have to shell out might go up. In metros and the larger cities, audiences might shift to connected TV as most of the key channels are available through streaming platforms and if not, they will decide between the must-haves and the good to have channels. So, we may see a drop in the bouquet preferences and individual number of channels selected for a household. But there is still time for the individual regional OTTs to take off in a big way for the regional audience to switch completely. Audiences who watch TV for entertainment will shell out that extra in the regional markets. The content pull of these channels is also huge, the TV stars are mini-celebrities in themselves and viewers are quite loyal to their favourite channels,” Sujata Dwibedy, group trading director, Amplifi India, dentsu International said.

Regional channels stand to gain as consumers won’t take a chance to do away with them, agreed Kailashnath Adhikari, managing director, Governance Now, a fortnightly magazine by media and entertainment conglomerate Sri Adhikari Brothers that owns channels like Mastiii, Maiboli, Dabangg and others. “They would rather cut some four to five odd channels but stick to their favourite regional channels. Markets of South, West Bengal and Maharashtra will see regional viewers stick around. It is one of the strongest mediums for people to connect with their roots and culture,” Adhikari said.

To be sure, many broadcasters are remain worried that overall migration of viewers to OTT could reduce their advertising and subscription revenues leading to lower-quality programming, in general, across languages. In a price-sensitive market like India, consumers are likely to have a set cost in mind for monthly subscriptions and in the long term, will start weighing the benefits of OTT packages versus cable bills and rationalisation of channel preference could be seen. 

Chandrashekhar Mantha, partner at Deloitte, agreed that even in the regional genre, there could be channels that are niche for a particular market that may not have substantial scale or viewership and, in time, would have to either take the free-to-air route or shut down entirely.

“The transition as far as regional content goes, may not be happening as much since 80% of the smartphone penetration is in tier-one cities. But there is no guaranteed formula to success, it all depends on content. In two to three months, if a majority of our channels don’t get picked up, advertising rates will come down and content costs will be difficult to manage,” said a senior executive at a broadcast network who declined to be named.

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