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Home / Analysis / Analysis | Should corporates take a stand on TV news?

Analysis | Should corporates take a stand on TV news?

A combination of a more robust sample by increasing the number of household meters and systemic checks need to be put in place

analysis Updated: Oct 19, 2020, 19:29 IST
Lloyd Mathias
Lloyd Mathias
Given that news viewership is a small segment of overall viewership, even a small change in TRPs will mean a big swing in ad revenues
Given that news viewership is a small segment of overall viewership, even a small change in TRPs will mean a big swing in ad revenues(Hindustan Times)

The controversy around television news channels manipulating Televison Rating Points (TRPs) has turned the spotlight on three issues plaguing television news. The first is the growing toxicity in coverage that sometimes borders on what may be termed “hate speech”. The second is the reliability of the TV rating system which decides the fate of nearly ₹30,000 crore in advertising revenues. The third — linked to the two — is the role the advertiser plays in moderating this stridency by leveraging ad spends.

The coverage of Sushant Singh Rajput’s death and its aftermath made a spectacle that would make most reality shows seem moderate in comparison. Hyper-aggressive anchors, high-voltage drama news breaks, dissing rival channels’ stories have become the norm — all for an increased share of TRPs.

TRP is an estimate of the TV viewership for a show, and is the only metric that determines the viewing patterns of 840 million Indians in 197 million TV-owning households and is the basis on which advertisers allocate their money. A TRP of 10 means 10% of Indians with a TV, in of a specified demographic or geography, are watching a channel at a point in time. That is about 84 million viewers.

TV advertising spends in 2019 around ₹28,000 crore, excluding Goods and Services Tax (GST). Of this, news occupies a relatively small share of 13% of the total audience, well behind general entertainment, movies, music and sports, and gets ₹3,640 crore of advertising, spread over nearly 400 news channels.

Given that news viewership is a small segment of overall viewership, even a small change in TRPs will mean a big swing in ad revenues. Advertising comprises nearly 45% of news channel revenues and can adversely affect channel viability. In this scenario, is there a case for brands to use ad spend as a tool to aid responsible behaviour?

Earlier this year, more than 600 companies, including some of the world’s largest advertisers, pulled advertising off Facebook in the United States (US) as part of the “Stop Hate for Profit” campaign. This was for its refusal to moderate hate speech during the height of the Black Lives Matter movement in the US. Even in India, a few advertisers have been debating the idea of boycotting certain news channels for similar reasons.

One view is that in a true democracy, corporations should not be allowed to tell news channels how and what to report. If corporates withhold spends on channels with a view to ask them to “behave”, they are fundamentally interfering in the process of news delivery, and are actively diving into areas that are beyond their commercial mandate.

Such advertiser activism is tantamount to strong-arming news channels with a view to throttle their content and breaches the line between commerce and editorial independence. While today the expectation may be to pull their advertising off news channels that may seem toxic, it won’t be long before activists expect brands to pick sides in ongoing political and social debates, and this can have no end. Also, what constitutes toxicity in a news channel may be quite subjective.

Brands also cater to diverse consumer segments and what seems like a justified stance to some customers may seem partisan and biased to another. This can impact revenue and raises questions on the personal alignments of brand owners and their accountability to investors. In today’s polarised atmosphere, any attempt to boycott a channel can backfire, especially if that channel has wide viewership — even though the brand custodians may view that segment of viewers with disdain. In a country with diverging views, choosing issues and sides will be a nightmare that most brands would like to avoid.

Businesses which sense that their customers are perturbed about the content or coverage on any particular news outlet, or find the editorial environment incongruous to their brand’s values, will subtly pull back — without overtly making a statement. Businesses also have the option of driving opinion on moderation and responsible behaviour through their own advertising messaging and by supporting causes in the space that they think some news channels are disrupting.

The alternative view fast gathering momentum is that it is incumbent for corporations to do the right thing even though it may have short-term implications on their bottomline. Purpose is now becoming central to companies and sticking to strong ethical principles even in the face of short-term threats to profitability is best. A business entity has a stake in the community they operate in and they must contribute positively to stay relevant. Moreover, a new generation of millennials expect their brands to stand up for issues that matter to them. While the government has directed all channels to strictly adhere to the programme code under the Cable Television Regulation Act and cautioned against airing content that is slanderous, defamatory, or based on innuendo and half-truths, the real challenge to address is the need to make TRPs tamper-proof.

A combination of a more robust sample by increasing the number of household meters and systemic checks need to be put in place. The government would do well to subsidise the costs that would be needed to make this happen for the greater good.

Lloyd Mathias is a business strategist and early stage investor
The views expressed are personal

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