Issue 10, dated February 1, 2005
 
 
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In a surprise move, the federal Indian government is considering an increase in the limit of foreign direct investment in the news-based print sector from the current 26 per cent to 49 per cent. More…
Wall Street Journal is getting set to launch in India early March. The launch may possibly happen even around the presentation of the annual federal Budget (end-February), if some key clearances come through.More…
The Directorate of Audio-visual Publicity (DAVP), through which the federal government releases its advertisements to media, is considering a hike in the rates that it offers to various print publications. More…
Fairbrother Lenz Eley, the world's leading media auditing and consultancy company, and Mumbai-based Spatial Access, India's first media auditing company, have announced an agreement to work together in India and around the world.More…
Bennett, Coleman & Co's (BCCL), the publishing house that owns India's most-read English daily The Times of India and financial daily The Economic Times, is aggressively sewing up exclusive long-term advertising deals with clients, locking the competition out of their media plans in the process. And it is taking the "equity participation" route to do so. More…
National Film Development Corporation (NFDC), which is the apex government-funded body in the country with the mandate of promoting good (Indian) cinema in the country and elsewhere in the world, has decided to stop the publishing its quarterly print magazine Cinema In India. More…
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Govt “open” to increasing FDI limit in news print media from 26 to 49 %:
In a surprise move, the federal Indian government is considering an increase in the limit of foreign direct investment in the news-based print sector from the current 26 per cent to 49 per cent.

The hotly debated issue came up for discussion at a recent Group of Ministers (GoM) meeting, at which the issue of a possible increase in FDI was raised by home minister Shivraj Patil. For non-news-based print companies, the limit has already been increased to 74 per cent.

Given the fact that the government survives on the critical support of Left parties, it was widely believed that the government would try to control FDI in print media in the country. However, in an effort to actually increase the FDI limit, the home minister has separately started talking to various other smaller political parties to seek their support for its proposal.

The proposal is likely to meet with some resistance from within the GoM, who have already voiced their opinion against an increase in FDI in print media. Spearheading this anti-increase campaign is the information and broadcasting minister S. Jaipal Reddy, who too belongs the to the Congress party – the largest in the ruling coalition.

Apart from FDI, the government also seems to be keen on increasing the limit of 7.5 per cent of foreign syndicated news content in Indian print media.

The GoM is expected to submit its proposals to the Indian Parliament for wider debate and final approval once its own deliberations are over.

The final decision of the government will be implemented through an amendment to the Press and Registration of Books (PRB) Act, 1867, and FDI Policy in Print Media.

Till date, the government has cleared FDI in two newspapers, 17 Indian editions of foreign non-news and non-current affairs magazines and 13 foreign investments by international publications in various Indian non-news and current affairs publications.
WSJ set to enter India:
Wall Street Journal is getting set to launch in India early March. The launch may possibly happen even around the presentation of the annual federal Budget (end-February), if some key clearances come through.

The 16-page edition with two or more pages being done out of India is scheduled to be edited by veteran journalist Suman Dubey.

Bennett, Coleman & Co. (publishers of The Times of India and The Economic Times) and Dow Jones had inked an agreement last year to form Times Journal India Pvt Ltd (TJIPL), which will publish WSJ.
Govt. to reconsider ad rates offered to print media for its ads:
The Directorate of Audio-visual Publicity (DAVP), through which the federal government releases its advertisements to media, is considering a hike in the rates that it offers to various print publications.

The announcement of the revision came from DAVP’s director general Swagat Ghosh at a seminar of Indian Newspaper Society (INS) on small and medium newspapers, in the wake of a debate on whether the government was being partisan towards the large newspapers.

Mr Ghosh denied that the Government body has been unfair to the small and medium newspapers in distributing social message advertisements. He said that 67 per cent of DAVP ads went to small and medium newspapers last year, the rest going to the big dailies. "It's just that the amount given to the larger publications were high as their circulation was also large," he explained.

Mr Ghosh said a rate structure committee was set up to look into the concerns of small and medium newspapers. When asked why the DAVP card rate was so low, he responded, "The rate is certainly low but the volume is large and so perhaps it compensates. Also, primarily the advertisements that we give out are social service messages and hence we cannot give market rates for them."

The small and medium newspapers have already made a representation to the government that their share of total DAVP advertisements should increase to 80 per cent. Taking a cue from the rate revision announcement, even the Association of Indian Magazines (AIM) has written to DAVP saying that magazines be treated differently from newspapers, because their production cost was high on account of better production and paper quality.
Global media audit major FLE announces tie-up with Indian co.:
Fairbrother Lenz Eley, the world's leading media auditing and consultancy company, and Mumbai-based Spatial Access, India's first media auditing company, have announced an agreement to work together in India and around the world.

Phil Welch, Director and Partner of FLE, and Meenakshi Madhvani, Founder of Spatial Access, made this announcement in India recently.

"The global interest in media auditing and consultancy has seen a very rapid growth over the last few years and India features high on many client lists of markets for greater media focus," said Phil Welch, director and partner, FLE. "In response to our international clients' interest in their media investment in India, we were keen to find a partner with pedigree and standing. Spatial Access fitted the bill perfectly," Welch added.

The working agreement will enable FLE's international clients to have local Indian support, while Spatial Access will be able to utilise FLE's growing global network for Indian clients looking for international auditing and consultancy.

“India is a massive market with a sophisticated media scene; it was a natural step for us to seek a suitable partner here," Welch said.

FLE currently provide media auditing and consultancy services to some of the world's largest advertisers, working in 56 markets. Established in 1990, FLE monitors and advises clients on around $5 billion of media investment.
Times of India enters into equity-for-ad deals:
Bennett, Coleman & Co's (BCCL), the publishing house that owns India's most-read English daily The Times of India and financial daily The Economic Times, is aggressively sewing up exclusive long-term advertising deals with clients, locking the competition out of their media plans in the process. And it is taking the "equity participation" route to do so.

BCCL struck deals to pick up equity stakes in two companies. In Chennai-based Celebrity Fashions, that owns the menswear brand Indian Terrain, BCCL is acquiring a 12 per cent stake.

In the Rs 650-crore Pantaloon Retail India, it is taking a 4.53 per cent stake. As a trade-off, BCCL is expected to push and promote the companies' brands through its media products including The Times of India, The Economic Times, Internet portal Indiatimes, lifestyle television channel Zoom and Radio Mirchi.

BCCL is said to have spent Rs 70 crore to acquire a stake in Pantaloon in return for which it is expected to earn a similar amount of advertising over five to seven years.

The Celebrity Fashions deal is a barter deal of sorts in which BCCL will acquire its stake in return for Rs 21 crore worth of advertising over three years.

By July, BCCL hopes to seal about 40 such deals, though it is difficult to say how much the new business model would contribute to the company’s Rs 2,000-crore (US $ 455 million) advertising revenue target for the year ending July 2005.

The company does not see taking equity in companies as a deviation from its core business. "It's a different design in the same business -- selling media solutions," company officials said.
Film magazine folds up:
National Film Development Corporation (NFDC), which is the apex government-funded body in the country with the mandate of promoting good (Indian) cinema in the country and elsewhere in the world, has decided to stop the publishing its quarterly print magazine Cinema In India.

With a total circulation of 2,000 copies, the magazine was largely patronised by the Ministry of External Affairs and went to Indian missions abroad.

NFDC has, however, decided to continue with the magazine’s online version, providing all the content that it was generating for the print edition.
 
 
The newsletter - Indian Media Observer - is produced by Chronosphere’s CEO Bhupesh Trivedi personally. Chronosphere is based at B205, Nirman Palace, Pump House, Andheri (East), Mumbai – 400093, INDIA.