What is it about TV ratings? On December 3 this year, India’s broadcast regulator, the Telecom Regulatory Authority of India (Trai) released yet another consultation paper on ratings. The ‘Review of Television Audience Measurement and Ratings in India,’ is the fourth report/paper on ratings. The last resulted in the formation of Broadcast Audience Research Council or Barc just three years back. What is the provocation this time?
“Several concerns relating to neutrality, reliability of the existing rating system have been raised by stakeholders…. issues relating to panel expansion and panel tampering,” says the paper. And since broadcasters
make a bulk of their money from advertising, improving the metric is important, says the paper.
Going by numbers from EY, of the Rs 660 billion that television made as an industry, Rs 267 billion came from advertising. This money went to broadcasters
fair and square. Of the remaining Rs 393 billion collected by cable and direct-to-home or DTH operators, Rs 99 million or about 25 per cent went to broadcasters.
It had been stuck at 5-15 per cent for many years before rising in the aftermath of the transparency that DTH (2003) and cable digitisation (2011) brought. In most markets around the world, broadcaster share of pay varies between 50-60 per cent. In India, between the 25 per cent coming in and the 60 per cent that should, is a huge stash of cash that goes unexplained.
This lack of transparency and therefore abysmal pay revenues is one of the big reasons the world’s second-largest TV market (by volumes), remains a joke on monetisation. The average revenues per user and margins of broadcasters in similar markets are many times those of India. It also explains why no major global cable firm has invested in India, though 100 per cent foreign investment was allowed three years back. An even spread of pay revenues will mean more jobs on the ground, better service, investments, higher tax collection and definitely better programming. If the broadcast regulator is worried about the industry’s monetisation problem could it work on getting the missing Rs 250-Rs 300 billion?
That is the first question that arises after reading the consultation paper. The second is why ratings?
Ratings are an industry currency used to buy and sell advertising seconds. Barc is a joint venture between the Indian Broadcasting Foundation, the Indian Society of Advertisers and the Advertising Agencies Association of India. If any broadcaster, agency or marketer has a complaint he can haul Barc over the coals — because it is a shareholder. Across the world media measurement is done either by a joint industry body (like Barc), a not-for-profit firm (Numeris) or a private firm (Nielsen). Governments and regulators rarely play a role in it.
Did the Ministry of Information and Broadcasting get into why there was no readership data for almost three years between 2014-2017 or why box-office data is of such poor quality? These affect the businesses they are part of too. But the industry has to demand, organise and pay for a decent metric. And if it does not, well it deserves the metric it gets. Globally, research shows strong correlation between robust metrics and industry growth. Yet most broadcasters, publishers, radio operators and studios in India have been stingy about spending on data. Getting into micro-managing the metrics doesn’t behove the broadcast regulator. Especially one that has done commendable in bringing order and method to the mess TV distribution was about 15 years back.
Barc however, welcomes the move for its own reasons. “A lot of points in the Trai
paper are ones that we have raised earlier. We look forward to their support in controlling panel tampering through provisions in the Indian Penal Code and expanding the sample via RPD (return path data),” says Partho Dasgupta, ceo, Barc. This means making it compulsory for cable and DTH operators to share data from set-top-boxes and servers. This would mean a larger sample weighed according to the size of the operators. It also raises hope for a hybrid metric for linear (TV) and on-demand (online) video. The Canadian regulator mandated RPD recently.
You could argue that much of this could be worked out by Barc and its shareholders, that is what self-regulation is all about. Why invite the regulator into micro-issues? But that is the Indian market for you.