The most important is that these are moves aimed at micro-managing a thriving Rs 1,473 billion industry. Where is the big picture policy that can catapult India’s iconic but undermonetised media and entertainment industry into a world-class force that brings in more than the current half per cent of gross domestic product?
Take television. India is the world’s second largest television market in volumes but one of the most under-monetised one. In any other market – the US, the UK or Europe the sheer volumes would mean that governments would be hyper-focused on the employment and tax generating capabilities of the business. They would have commissioned studies on how the ministry can facilitate better monetisation. India has 297 million homes of which only 183 million have a TV. According to a recent study by Deloitte the Indian television industry employs 0.5 million people directly and 1.65 million in all (direct and indirect). Its gross output or the combined revenue of all industry participants is more than double the TV industry’s actual size of Rs 660 billion.
Now imagine the multiplier effect of a policy that facilitates growth in such an industry.
And for effect also imagine what not having such a policy has meant. In the last decade or so only two big decisions have been made by the ministry – cable digitisation and auctioning of radio spectrum. The first was meant to release a couple of billion dollars into the TV ecosystem and free broadcasters from the tyranny of ad revenue-driven programming. But digitisation is not yet complete and the promise of pay hasn’t quite worked out.
Does it then behove the government of such a large TV market to be fretting about how Barc measures viewership or chips on DTH boxes. Last year advertisers spent Rs 267 billion on India’s 800-odd television channels. Both advertisers and broadcasters are users and subscribers of the data and also the co-owners of Barc. They sit on its board and technical committee, they can sort it out.
One simple move — greenlighting the 100-odd channels awaiting licences to start operations (from over 4 months) will have a more positive impact on the TV ecosystem than all this focus on ratings.
Here is another example.
India makes the largest number of films, is a huge film-loving democracy but its market lags behind smaller markets on revenues. More than three-fourths of the Rs 156 billion the film industry earned in 2017 came from the box office. Yet there are only 9,000 screens left in India. While multiplexes have been adding 150-200 screens every year, single screens have been shutting at twice that rate. The result is a stagnant box office over three years now.
What holds back screen expansion is not capital but bureaucracy. Getting the permission to open a theatre takes anything from six months to two years. There are dozens of them ready in various parts of the country, awaiting a licence. A rise in screen count is a critical growth lever. In 2011 at 9,000 screens China pushed investment to reach the current 50,000. This has catapulted it to the second largest market with $7.9 billion at the box-office in 2017.
Maybe the ministry’s time would be more productive if it facilitated a policy that helps speed up the process for opening theatres. To quote the Deloitte report films employed 0.25 million people directly and just under 0.7 million totally. More theatres will mean more jobs, more taxes and possibly more votes.