Reportage

Bad News

By KRISHN KAUSHIK | 1 December 2012
KEITH BEDFORD / BLOOMBERG / GETTY IMAGES

(ONE)

ON A FRIDAY EVENING IN JULY 2006, a six-year-old boy named Prince fell into a 60-foot-deep borewell in Haryana. By that night, almost all the national television news channels were pursuing the story. India TV was an exception; instead of the Prince story, the Hindi-language news broadcaster at prime time aired a programme about a terrorist wanted in India and arrested in Nairobi, who vanished before the Indian authorities could get to him. When India TV’s CEO, Chintamani Rao, arrived the following morning for his weekly meeting with the channel’s editor-in-chief, Rajat Sharma, and other members of the editorial team, he realised that everyone else had spent the previous night watching Prince’s ordeal on rival channels. “The whole buzz was about Prince,” Rao recalled. During the meeting, they turned a television to Zee News to see what was happening to the boy. The anchor was going hysterical, Rao said, saying things like “Jab tak Prince nahi bachega, hum yahan se nahi hatenge. (We will not move from here until Prince is saved.)” Everyone laughed—“as if he would save the child sitting there in his studio”, Rao said. But Rao realised the story was compelling. “I said, ‘Shit! Guys, maybe we are missing something.’” On Saturday, India TV dispatched its own team to cover the borewell rescue, even though Rao knew “everybody [else] was already showing it”.

Prince was saved on Monday morning. When the data arrived a few days later, Rao discovered that, during the 50 hours between the boy’s tumble into the well and his rescue, Zee News had been watched by more than 40 percent of Hindi-language news viewers; India TV’s share over the same period languished in single digits. “This is what was working,” Rao said. “We realised more and more where the viewership was.” India TV rarely passed up another chance to broadcast a dramatic rescue effort.

THE DATA RAO WAS REFERRING to constitute a weekly report card of television channel popularity, telling broadcasters what programmes audiences watched. Broadcasters, Rao later told me, are like “junkies” desperate for a fix when it comes to the data, which are collected and published by Television Audience Measurement (TAM)—a joint venture of the market research agency AC Nielsen Company and two subsidiaries of the London-headquartered media and advertising colossus WPP.

TAM’s data, expressed as television rating points (TRPs), are a major currency in the Rs 329 billion broadcast industry. The higher a programme’s TRPs are, the more money a broadcaster can demand from advertisers for airtime during that show. As a result, many broadcasters try to shape their programming to deliver the highest ratings; advertisers, in turn, wield considerable influence over the sorts of shows that broadcasters produce. “TV content is dictated by the choices that advertisers make and their assessment of what audiences want,” a member of a committee convened in 2010 by the Ministry of Information and Broadcasting to examine TAM ratings told me. Ultimately, then, the ratings system influences the television content seen by approximately 666 million people in India’s 148 million television-owning homes.

Although the ratings are essential to the television broadcast and advertising industry, there has long been skepticism about the validity of TAM’s data. Many within the industry claim that the ratings agency does not collect enough information to gauge the viewing behaviour of a country as large and heterogeneous as India. This has been compounded by accusations of widespread corruption within the ratings system. As one senior executive from the English-language news broadcaster New Delhi Television (NDTV) put it, “there are various forms of subversion and inducement that are taking place” to distort the ratings.

At the same time that they’re crying foul about TAM and its data, however, broadcasters are also spinning the ratings in their favour. Among the top three channels for English-language news—Times Now, CNN IBN and NDTV 24x7—there isn’t a clear leader, Rao told me. “It’s touch and go, week after week.” Nevertheless, Rao said, each of these channels uses TAM’s numbers to advertise that it is the most popular. “They dissect the data, and view it from every possible angle” to claim the number-one position. What gets lost in the fine print is the market or subdivision of a market—for example, male viewers, 25 to 44 years old, in the top two socio-economic segments, in four metros, between 9.30 pm and 10.30 pm, in the last 13 weeks—in  which a particular channel is number one. Several channels even advertised leading in viewership for the September 2010 “Ayodhya Verdict”.

Other large media and advertising agencies also use TAM ratings even though they claim to have their own data. “In fact, much more reliable data,” said Lynn de Souza, head of Lowe Lintas, one of the biggest agencies in the country. According to de Souza, the “parallel data” her company has are much deeper and more strategically important to decisions about the channels on which it places advertisements. But TAM’s numbers still serve a purpose. “We use the TRPs as a currency, when we’re negotiating with the broadcasters” on advertising rates, de Souza said. Arvind Sharma, chairman of Leo Burnett for South Asia, said his advertising firm uses TAM’s ratings in a similar way.

In other words, no one will advertise with a broadcaster just because its TAM ratings are high. (“There was this one particular news channel that had large numbers,” the India CEO of an international media agency told me, but they could still not get the big advertisers because of their down-market reputation; he later revealed that the channel was India TV.) If a broadcaster’s ratings are low, however, it will not be able to command decent prices from advertisers.

Making money in the news broadcast industry is a zero-sum game. The money that one broadcaster loses—whether due to the quality of its content or to the allegedly inadequate and corrupt ratings environment—inevitably fills the coffers of rival channels. The effect of all this is to encourage news broadcasters, for the sake of their profits, to chase, manipulate and even attempt to buy ratings that many industry insiders consider highly suspect.

But the problems with TAM ratings are only one part of a broader challenge to the viability of India’s television-news industry. “TV news is not a profitable business,” a senior television journalist told me. Through a number of morally and economically questionable mechanisms, the entire model of how a channel should earn money has been flipped on its head. “The economics,” said Rao, “are completely screwed up.” This, in turn, has consequences for what counts as news in India and how that news is made.

(TWO)

EARLIER THIS YEAR, NDTV (which owns NDTV 24X7, NDTV India, NDTV Profit, and two other channels) became so fed up with the state of the ratings system that it took the matter to court. In a 72-page lawsuit filed in New York in October, NDTV demanded over $700 million in compensation for losses to its finances and goodwill due to “breaches of contract, negligence, tortious misconduct and conspiracy to defraud NDTV in connection with [the] continued exploitation of corrupted, manipulated and fraudulent … television ratings”. The lawsuit, which is a revised version of a complaint originally filed in July, names as defendants AC Nielsen Company (and three other Nielsen companies), and WPP and its subsidiary Kantar Media. (All of these firms have offices in New York, where, according to the NDTV executive, the broadcaster hopes to receive a faster legal decision than it would in India. TAM itself, which has no presence in New York, has not been made a party to the revised lawsuit.)

According to NDTV, the way audience data are collected leaves the ratings open to corruption, in which TAM’s parent companies are allegedly complicit. TAM has a panel of 8,150 homes in urban India, each of which is equipped with a PeopleMeter. This gadget connects to a television and records which shows are watched in a household and by whom. TAM then extrapolates from the data recorded by PeopleMeters to estimate the popularity of channels and programming in locations across the country.

The lawsuit claims that some of TAM’s panel homes, which are meant to be secret, remain undisclosed only to the naïve and the upright. With the help of “consultants”, any broadcaster can identify these households and offer viewers large screen plasma television sets, monthly sums close to Rs 100,000, or other incentives to watch its programmes and rig the ratings. TAM, its employees, and its controlling companies know about and benefit from this “endemic” corruption in the rating system, NDTV said.

THIS IS NOT THE FIRST TIME that TAM’s data have been publicly impugned; it is an intensification of a scandal that first erupted more than a decade ago.

In 2001, Sandeep Goyal was group broadcasting CEO of Zee Telefilms. Ratings data had, at the time, just begun to matter to TV channels and advertisers. The latter had started to insist that the cost of advertising reflect a channel’s ratings, and cost-per-rating-point (CPRP) became the basis on which deals were made.

To his shock, Goyal found that ratings could be bought. When he took over at Zee, there were already a lot of “brokers” in the market offering to fix ratings points. Initially, he thought it was just a joke—“How could somebody fix the TRPs?”—so he called one of the brokers and said, “I don’t believe you.” The broker promised to triple the ratings of one show in the space of a month. For Goyal, it was a trial run. “At the end of four weeks, [the broker] actually took the programme from one to three TRPs. I was completely taken aback.” Goyal asked the broker, “Boss, what is the funda?” There was no special trick, the broker said. “Basically, everything is available for a price.” Once you knew which houses had PeopleMeters, there were various ways to boost ratings, he told Goyal.

Soon, Goyal was approached by a man who offered him a complete list of panel homes. To corroborate the list, Goyal said he sent teams to five houses in Mumbai and five in Delhi. PeopleMeters were installed in each one. Every household his teams visited wanted to know how much money Zee was willing to pay, he said. “Which means we were not the first visitors.”

One of the ways to boost ratings was to put extra televisions in panel homes. “The modus operandi as I understood it was that they have a TV with a meter connected to it,” said Goyal. On this television, the family would switch between programmes, “as paid and as instructed” by a consultant. “And whoever was kind enough to affix that deal had given the family a separate large TV to watch what it wants.” Goyal found such arrangements in at least 30 households across the country. “I was left with no doubt that it was all fixed.”

CNBC and Outlook broke the story of the ratings scandal in 2001; but it didn’t matter, said Goyal. “Nobody wanted an established system to change.”

IN ITS LAWSUIT, NDTV said that it first complained to TAM about its data in 2004. On 9 November of that year, NDTV wrote to the ratings agency regarding “discrepancies in the Sunday Viewership of English news channels”. During a two-hour period one Sunday, when there was no special programming or events, the reported audience size for English-language news went up from 50,000 to 200,000. Some panel homes were watching English news for 105 minutes—more than 100 minutes more than the average. The audience share of English-language news viewers for an NDTV rival went up from 20 percent to 70 percent for those two hours. In the years that followed, the NDTV executive told me, the broadcaster wrote more than 240 emails to executives at TAM and its controlling companies, and met with them several times each year—all to no avail.

Eventually, in January 2012, NDTV complained directly to David Calhoun, CEO and chairman of Nielsen, about “serious defects in the Nielsen Process, as applied to the Indian market”. By then, NDTV had convinced a consultant from Karnataka with a “pretty good track record” to become “a whistleblower, to break the system”, the NDTV executive told me. “We even offered to pay.”

In January, February and April, NDTV met at least four times with Calhoun; heads of Kantar, TAM, and market-research firm IMRB International, another WPP-owned TAM shareholder; and Robert Messemer, Nielsen’s chief security officer. The whistleblower, who was present at some of these meetings, disclosed the various methods he and his contemporaries used to influence TAM’s data. According to the lawsuit, the whistleblower informed one meeting that “in the past he used to bribe TAM personnel as well as PeopleMeter homes in order to manipulate ratings for TV channels and he was successful at doing so”. Moreover, the “consultant further disclosed that his own home was empaneled as a panel home by another consultant in connivance with TAM.” He also showed the meeting a copy of a cheque for Rs 85,000—the monthly sum paid to him by another consultant to allow manipulation of ratings for a rival channel.

“Absolutely shocking and un-fucking-believable,” Messemer exclaimed, according to the lawsuit, during an April meeting with NDTV after he was shown the reports from the whistleblower and a short video of a sting operation conducted by NDTV on another consultant. At the same meeting, Messemer, according to the lawsuit, told a colleague that investigations he had conducted after NDTV’s first presentation in January revealed that many TAM personnel refused promotions because they were earning huge amounts in bribes and they would lose this income if promoted.

Nielsen—who declined to comment for this piece—promised to take corrective measures; Messemer promised follow up meetings in May and June, NDTV said. In an email quoted in the lawsuit, the head of IMRB International wrote to the executive vice-chairperson of NDTV to acknowledge that there had been “attempts to influence TAM panel integrity” and to inform him that Nielsen was “putting into place many security measures to prevent the data from being vitiated”.

By the end of May, said NDTV, none of the promised steps had been taken by TAM or its controlling companies. Its patience finally exhausted, the broadcaster decided to pursue the matter in court.

DESPITE ITS ALLEGED INADEQUACIES, broadcasters are in thrall to TAM. “There was a time when a broadcaster could go to a client and say that TAM sucks, TAM is shit,” and advertisers would agree, Mahesh Murthy, the former country head of Channel V and current CEO of internet marketing firm Pinstorm, told me. Now, he said, TAM maintains a hold over the industry largely because it is backed by WPP. The gargantuan conglomerate owns large media and advertising agencies such as MindShare, MediCom, Ogilvy & Mather, JWT, Grey India, Contract Advertising and Madhouse India, which buy airtime and place advertisements on channels. It is therefore an important source of broadcasters’ revenues. “There is an agglomeration of buying power at WPP agencies,” said Murthy, and “it’s in WPP’s interest to keep quoting TAM”. PN Vasanthi, director of the Centre for Media Studies, gave a similar account of WPP’s influence over broadcasters.

This dynamic may have particularly profound effects on the relatively small television news industry. “All of us are just tiny in comparison to something this big,” said the NDTV executive about the companies that control TAM. “There’s a conflict of interest—they decide what the research is and they also decide what the media buying should be.”

“The reason why it hurts you is that people who choose not to be honest, it’s a choice they make,” the NDTV executive said of corruption in the ratings system. NDTV had been “approached and offered to be made number one for a price,” he lamented. “That should be done because of the viewer, through good programming.” He said he wants “the fight” for success in his industry to be based “on content and not on corruption”. But the battle for good television news content may be a losing one.

(THREE)

WHEN NDTV became an independent broadcasting company in April 2003, the industry’s revenue models were relatively straightforward. Broadcasters offered their channels to distributors called multi-system operators (MSOs), which, in turn, distributed those channels to local cable operators in their respective networks. Local operators piped the programming to, and collected subscription money from, the homes that they served. A share of the subscription fee, negotiated with each channel, would flow back to the system operators and broadcasters. In a typical share, the local operator kept 25 percent; the system operator kept 30 percent; and the broadcaster received 45 percent of the fees, with which it could invest in talent and the production of content.

This balance quickly began to tilt in favour of operators. More than 180 domestic and international channels were available; but due to technical limitations, analog cable networks—the only networks at the time—could not carry more than 80 channels. Of these, older television sets could receive only a fraction. This created two bottlenecks for broadcasters: what the cable operator could offer, and what the viewer could watch. In addition, cable operators had mutually exclusive territories—each territory, as a result, functioned like a monopoly. Without the threat of competition, operators could set the terms for broadcasters, which they often held to ransom by shifting channels from prime to fringe frequencies, thereby affecting the channels’ transmission quality or reach. They could even refuse to carry a broadcaster’s channels.

But broadcasters found ways of ensuring this did not happen. “I spent around 15,000 rupees to show these cable operators around, drinking and partying with them, just to get them to carry my channel,” said Pankaj Krishna, who worked for National Geographic in 2001. The parties evolved into Bangkok trips, then into free air conditioners and computers, and finally into cash payments. Such payments eventually became known as carriage fees. “For every news broadcaster,” said Chintamani Rao, who moved from India TV to Times Broadcasting before his retirement, “carriage fee is the single largest expenditure.”

Other fees soon developed. Consumer demand for general entertainment channels such as Star Plus, Zee TV and, later, Colors was great enough that cable operators reliably carried them on the best frequencies. Niche channels, such as those featuring news, music or cartoons, could easily be relegated to poorer-quality cable bands, which viewers often decided not to watch. In order to outpace competitors, niche channels started paying operators to be placed on preferred bands. These payments became known as placement fees.

Krishna, who now owns Chrome Analytics, a firm that audits multi-system operator and cable-operator reports, told me that a new channel today would have to shell out nearly Rs 800 million annually to reach prime bands in all Indian households.

NEWS BROADCASTERS ARE BLEEDING MONEY. The broadcast industry earned Rs 214 billion in subscriptions last year, according to a report by the consulting firm KPMG and the FICCI. But, because local operators disclosed only 15 to 20 percent of consumer homes, little of that revenue reached broadcasters. Local operators kept about 65 to 70 percent of it; multi-system operators took another 15 to 20 percent; and the broadcasters were left with a mere 10 to 15 percent, the report said.

Deprived of a share of total subscriptions, and faced with high carriage and placement fees, news channels have become what the KPMG-FICCI report called “net payers” for distribution: the costs of delivering their programmes to audiences are “not adequately compensated for by advertising revenue”. Many channels are running in the red. In the last financial year, NDTV’s after-tax losses were Rs 191 million (although even this was an improvement on the nearly billion-rupee shortfall they posted the year before).

Every one of the editors and CEOs I met agreed that broadcasters’ significant financial losses due to distribution fees and limited subscription revenues dent their ability to produce quality content. The senior television journalist told me that sports, politics, and entertainment hog airtime on news channels partly because this content is easy to produce. For sports and politics, “all you have to do is send a reporter and cameraman to cover the event or a rally and talk to experts”. For entertainment, broadcasters have to do nothing—they are approached. Investigative reporting is more expensive. “It costs me two to three lakh rupees to produce a two-minute story,” he said. Most broadcasters do not have the resources and patience to send teams on assignment to remote parts of the country; they prefer, instead, to bring in expert panelists to debate the most popular topics of the day. That “costs almost nothing”, the journalist said.

In the end, many broadcasters are left without the financial resources or talent needed to produce original journalism. As Rao put it to Rajat Sharma years ago, “We have to choose. If we don’t have the money to sustain ourselves, we’re a closed shop.”

Skewed distribution fees and subscription revenues make the economics of India’s television industry highly unusual. For broadcasters, said the NDTV executive, “the world norm for revenue generation is that 70 percent comes from subscription and 30 percent from advertising.” In India, however, because of under-declaration, “it’s 90 percent advertising and 10 percent subscription.” Advertising, in other words, is absolutely critical to broadcasters’ viability.

This, too, has peculiar effects on television news in India. In particular, it has made TAM’s PeopleMeters, and the ratings they produce, increasingly important. Every viewing recorded on these meters bumps up the ratings of the viewed channel and show; every increase in ratings allows the broadcaster to charge more for advertising during that show or on that channel. The goal, therefore, is to be watched by viewers in the panel homes. And this, together with the structure of TAM’s operations, has apparently encouraged the sorts of corruption that NDTV alleges in its lawsuit, as well as other distortions in television news.

(FOUR)

TAM WAS FIRST GRANTED A CONTRACT to produce television ratings by a joint body of broadcasters, advertisers and advertising agencies in 1998. At the industries’ behest, the ratings agency started with 1,800 meters.

Despite this industry mandate, however, TAM has long faced criticisms that its data do not adequately represent the size and diversity of India’s television audience. A former CEO of a news broadcast network compared India to “25 mini European countries” with differences in tastes, languages and consumption habits. TAM’s 8,150 meters, he said, are too few to measure this broad audience, which, according to TAM, contains approximately 148 million households. By contrast, the UK has 5,100 sample homes to represent a comparatively very homogeneous 27 million television-owning households.

LV Krishnan, CEO of TAM, disagrees with such critiques. In number of meters, he said, “We are among the five largest markets in the world,” and this number is set to increase to 10,000 by January 2013. The homes equipped with these meters are the research sample from which TAM projects viewership trends—but it only claims to represent 50 million television-owning households in urban areas with populations greater than 100,000. “There are about 380 odd towns that are urban and with more than 100,000 population,” Krishnan said. “Out of that, our sample spread is around 162 [towns] and that is what the panel represents.” According to TAM estimates, the 50 million urban households represented by their 8,150 panel homes contain approximately 225 million people. The company, Krishnan complained, never said it represented all 1.2 billion people in India—or even all households with a television.

Krishnan is a terribly polite man, but he speaks with conviction. “Rating is nothing but number of people who watch a programme and amount of time they spend watching that particular programme,” he told me. Unlike credit-rating agencies such as Standard & Poor’s, he said, TAM ratings are not TAM’s opinions. “This is purely driven by behavioural patterns actually done by automated machines.” To make these patterns representative of urban areas across India, TAM tries to include households from the smaller, homogeneous communities that make up the larger heterogeneous society. Homes are selected based on a mix of parameters, including socio-economic classification, household size, mother tongue, and possession of a colour or black-and-white television.

Nevertheless, many people have raised the question of why India, with its significantly larger and more diverse population, has fewer PeopleMeters than the US, where Nielsen claims to have over 20,000 panel homes. Krishnan rejects any such comparison. “As an industry, we need broad trends of how television behaviour is happening,” he agreed; but the US has a “70 billion dollar broadcast industry”. India’s is much smaller. Everybody wants a larger sample size, Krishnan said, but nobody is willing to pay for it.

PeopleMeters are engineered by Nielsen, and assembled and brought in from Europe. Each costs Rs 170,000. TAM pays for this, and operating costs, with subscriber fees. According to its lawsuit, NDTV has paid TAM $5.3 million since 1998 (approximately Rs 19 million annually). But Krishnan said that TAM has yet to break even. With revenues of around Rs 600 million, Krishnan said, TAM will start to cover its costs over the next five to six years, “if we remain constant at 8,000 meters”. To expand the number of meters, assuming all else remains equal, would require an increase in subscriber fees.

NDTV wants TAM to suspend its data reports unless it covers 30,000 houses in the sample, but it does not buy the argument about the need to increase subscriber fees, the broadcaster’s executive said. In any event, he added, NDTV would not want to pay more to increase sample sizes. “If you can’t run a business honestly, why run it?”

IF THE SIZE OF TAM’S SAMPLE IS A PROBLEM for television programming generally, the apparent problem is even more acute for English-language news. According to TAM, the healthiest segments of Indian television are Hindi and regional general entertainment, which each capture at least 35 percent of overall television viewership. In effect, this means that a relatively large number of panel homes are contributing data to make up these segments’ ratings. This leaves less scope for errors and gross fluctuations.

With news channels, however, the situation is very different. If you take out the mass viewing channels and look only at news networks, the NDTV executive said, the number of homes contributing data to the ratings comes down to about 300 to 400 across the country. English-language news is only a subsection of this market, which also includes English-language business and Hindi-language news. “If you further subdivide it to English news channels,” the executive said, the number of panel homes contributing data “would be only a hundred”. The television-viewing habits of these 100 households profoundly influence how English-language news is made and watched in India.

In other words, contrary to popular perception, English-language news is a fringe genre of Indian broadcasting. TAM’s data indicate that, for the first six months of this year, English-language news was watched by only 0.21 percent of the television audience in TAM markets. That amounts to one viewer for every 500 television-watching people, watching English-language news for less than five minutes per day.

Krishnan argued that a genre’s limited popularity cannot be blamed on TAM. “Who is defining the size of the genre? It is not me. It is audience who is deciding it based on the content of the genre. It can be a 10 percent [total television viewership] genre if they create a content that is watched by more people. As simple as that.”

But small sample sizes have consequences beyond the statistical. “The most fundamental thing to do is to find the homes” with meters, the NDTV executive said. “That is the easiest thing to find. If I say my most important markets for English news are the six biggest cities, I can, for a price, get a list. Now with that list I can find the locality in which those people stay.” Then one can go to their house, “either alone or in connivance with the TAM people, and offer incentives” to rig the ratings. “It’s like knowing the question paper before the exam.”

The editor-in-chief of an English-language news channel told me that the location of these meters across India also distorts news coverage of certain regions. Until recently, he said, there were no PeopleMeters in Kerala, and there are still none in the northeast. As a result, news broadcasters have little interest in covering news that isn’t of national importance from these regions. The NDTV executive agreed: sometimes, national news networks simply ignore certain states.

Instead, broadcasters focus on Delhi and Mumbai. From 7 to 11 in the morning and 8 to 12 at night, the prime times of television viewing, these two cities account for over 50 percent of the national viewership of English- and Hindi-language news, Rao said.

“If there are five ways to influence the system everybody is using at least three,” the other former news network CEO told me. “Nobody is completely clean,” including his erstwhile employer, he said. One senior executive in a large broadcast group went further, telling The Hindu on 1 August that, in his company, “about Rs 300 crore is budgeted annually to take care of the expenses needed to fix ratings” in his channels’ favour.

I asked Krishnan how to access the list of panel homes. According to him, the list is segregated so that TAM employees are only exposed to those households for which they are responsible. “Nobody will have the [full] list,” he said. “If you ask me, even I don’t have it.”

Sandeep Goyal told me that, in 2001, a representative of the ratings company InTAM, which was merged the same year with TAM, made similar claims about the adequate security of panel homes. Goyal, the representative contended, had got the list once by fluke, but wouldn’t be able to do it again. “All right then, let’s have a wager,” Goyal retorted. “Any city in Punjab that you cover, let’s take that.” Goyal declared that he would get the list of all the panel houses in 10 days. He found the InTAM employees in that city and put some people on their trail. Within a week, he had the addresses of all the panel homes. “By that time I had understood the funda,” said Goyal. “It is that easy.”

Krishnan agreed that people do try to influence the data, but suggested that such tampering was not successful. “Let me put it this way,” he said. “There are enough validation checks to protect integrity of data.” If panel homes have been compromised, he added, “as long as we come to know about it, homes are changed and life keeps moving on”.

(FIVE)

MANY BROADCASTERS DREAD THE PROSPECT of TAM’s expanding reach. For one, an increase in the number of PeopleMeters over the past decade catalysed the growth of carriage fees. Shrewd operators with panel homes in their networks charged exorbitant rates to carry broadcasters’ channels. Even though putting meters in new towns would allow broadcasters to gauge new audiences, some broadcasters would prefer to eschew those markets and avoid increased rates, Chintamani Rao said. A few years ago, the News Broadcasters Association approached TAM and asked it not to take the meters to new markets, because it would drive up distribution costs in those towns.

Some changes in the ratings are underway. Following recommendations from a 2010 report commissioned by the Ministry of Information and Broadcasting, the moribund Broadcast Audience Research Council, a joint-industry body intended to act as a ratings regulator, is soon to be revived. But not everyone believes regulating TAM will solve the problem. “Unless you punish the broadcasters who influence the ratings,” said Praveen Tripathi of Magic9 Media consultancy, the ratings will get tampered with. Without creating incentives for rogue broadcasters to mend their ways, “you haven’t found a solution”. The member of the Ministry of Information and Broadcasting’s 2010 TRP committee agreed. “In the context of India, where there is so much corruptibility, so many things can happen at so many levels,” he said. “Just to blame one agency is a mistake.”

Even more than the allegedly corrupt TRPs, the prevailing distribution arrangements continue to threaten the television-news industry. Broadcasters have not been able to tackle either the menace of carriage fees or what Jehangir Pocha of English-language channel NewsX called the “mafia operation” of cable operators. Rao gave two reasons for this failure. First, he said, broadcasters are not united. “The broadcasters who also own distribution networks [such as Zee and Sun] gain more from the distribution of other channels than they lose in paying for their own.”

Second, and more importantly, the cable operators—who, according to almost everybody in the industry, are mostly local “thugs” and regional politicians—have a very strong political lobby. In 2010, Nripendra Misra, then chairman of the Telecom Regulatory Authority of India (TRAI), told Rao that cable operators visited him in large numbers, shouting over each other to get their point across. “That is what you are up against,” Misra said to Rao. “The cable operators’ lobby makes itself heard. You don’t.”

In April, as part of an impending national shift to digital cable networks, TRAI announced its decision to ban placement fees. But, much to the chagrin of broadcasters, it explicitly allowed carriage fees to continue. In an interview after the announcement, JS Sarma, the former chairman of TRAI, told Vikram Chandra, CEO of NDTV, that carriage fees would be brought “to the surface” and “regulated”. Sarma said that 50 paise to Rs 1 per subscriber per year should be the accepted norm for carriage fees. But, the senior television journalist told me, the cable operators want two rupees per subscriber every month, or Rs 24 per subscriber per year, a 24-fold jump over Sarma’s upper limit.

Hopefully, the four-phased television digitisation process will provide other forms of succour to broadcasters in this losing game. On 31 October, in the first phase, the government blacked out all cable and satellite subscribers in Delhi and Mumbai without a digital set-top box or a Direct-to-Home service. This will open the bottlenecks created by analog cable technology, give viewers greater choice over the channels to which they subscribe, and give the broadcasters accurate figures on the sizes of their subscriber bases. The industry also believes this “game-changer”, as the NDTV executive called it, will return to broadcasters much of the money lost through the previous distribution arrangements.

The KPMG-FICCI report is less sanguine; it predicts that, even after complete digitisation, the share of subscription revenue for a broadcaster will only rise to 40 percent. Still, “that is double what I earn right now,” the NDTV executive said.

ALTHOUGH TAM’S DATA HAVE PLACED NDTV 24X7’s market share at around 20 percent for the last few years, NDTV advertises itself as the market leader. The channel bases this claim on surveys conducted by Nielsen and consumer research firm GfK. According to one survey, NDTV 24x7 had a 61 percent market share in “11 to 14 major metros” in March 2012, towering over its competition at CNN IBN and Times Now, which garnered 21 percent and 19 percent of the market, respectively. NDTV promotes this supposed dominance in an advertisement titled, “You Can’t Fiddle The Truth”. It’s a leftover from their 2010 campaign, a jab at TAM that ran, “You Can Fiddle The Data, You Can’t Fiddle The Truth”.

In the New York court, both WPP and Nielsen recently filed notices that they will move to have NDTV’s lawsuit dismissed. Nielsen argued that the lawsuit has no standing in New York; that, in any event, the company is not a party to NDTV’s contract with TAM; and that the lawsuit is illegitimate because TAM itself is not a defendant. WPP made similar arguments, but went a step further in its criticisms of NDTV. “This case is just an attempt to drum up media coverage in India to divert attention from the real reasons New Delhi TV’s programmes have had low audience ratings and its financial performance has been abysmal for five years,” charged a recent memorandum filed by lawyers for the conglomerate.

“For the industry I think the lawsuit has shaken up everybody,” reflected the NDTV senior executive. “It’s sad it’s through a suit. It’s not the first time that someone has threatened,” but in the past, he said, nothing ever changed. He believes things may be different this time. “I hope sense will prevail,” he said. “But let’s say NDTV gets destroyed because of the suit, which is a possibility. I think the company would still have done a great service to the industry because of the exposure. If it cleans up the system, great!”

I asked him why, for the time being, NDTV continues to run a business that is not profitable, playing a game in which all broadcasters are ultimately losing. “Because,” he said, “this is what we know.”

Krishn Kaushik is a Staff Writer at The Caravan.

(ONE)

ON A FRIDAY EVENING IN JULY 2006, a six-year-old boy named Prince fell into a 60-foot-deep borewell in Haryana. By that night, almost all the national television news channels were pursuing the story. India TV was an exception; instead of the Prince story, the Hindi-language news broadcaster at prime time aired a programme about a terrorist wanted in India and arrested in Nairobi, who vanished before the Indian authorities could get to him. When India TV’s CEO, Chintamani Rao, arrived the following morning for his weekly meeting with the channel’s editor-in-chief, Rajat Sharma, and other members of the editorial team, he realised that everyone else had spent the previous night watching Prince’s ordeal on rival channels. “The whole buzz was about Prince,” Rao recalled. During the meeting, they turned a television to Zee News to see what was happening to the boy. The anchor was going hysterical, Rao said, saying things like “Jab tak Prince nahi bachega, hum yahan se nahi hatenge. (We will not move from here until Prince is saved.)” Everyone laughed—“as if he would save the child sitting there in his studio”, Rao said. But Rao realised the story was compelling. “I said, ‘Shit! Guys, maybe we are missing something.’” On Saturday, India TV dispatched its own team to cover the borewell rescue, even though Rao knew “everybody [else] was already showing it”.

Prince was saved on Monday morning. When the data arrived a few days later, Rao discovered that, during the 50 hours between the boy’s tumble into the well and his rescue, Zee News had been watched by more than 40 percent of Hindi-language news viewers; India TV’s share over the same period languished in single digits. “This is what was working,” Rao said. “We realised more and more where the viewership was.” India TV rarely passed up another chance to broadcast a dramatic rescue effort.

THE DATA RAO WAS REFERRING to constitute a weekly report card of television channel popularity, telling broadcasters what programmes audiences watched. Broadcasters, Rao later told me, are like “junkies” desperate for a fix when it comes to the data, which are collected and published by Television Audience Measurement (TAM)—a joint venture of the market research agency AC Nielsen Company and two subsidiaries of the London-headquartered media and advertising colossus WPP.

TAM’s data, expressed as television rating points (TRPs), are a major currency in the Rs 329 billion broadcast industry. The higher a programme’s TRPs are, the more money a broadcaster can demand from advertisers for airtime during that show. As a result, many broadcasters try to shape their programming to deliver the highest ratings; advertisers, in turn, wield considerable influence over the sorts of shows that broadcasters produce. “TV content is dictated by the choices that advertisers make and their assessment of what audiences want,” a member of a committee convened in 2010 by the Ministry of Information and Broadcasting to examine TAM ratings told me. Ultimately, then, the ratings system influences the television content seen by approximately 666 million people in India’s 148 million television-owning homes.

Although the ratings are essential to the television broadcast and advertising industry, there has long been skepticism about the validity of TAM’s data. Many within the industry claim that the ratings agency does not collect enough information to gauge the viewing behaviour of a country as large and heterogeneous as India. This has been compounded by accusations of widespread corruption within the ratings system. As one senior executive from the English-language news broadcaster New Delhi Television (NDTV) put it, “there are various forms of subversion and inducement that are taking place” to distort the ratings.

At the same time that they’re crying foul about TAM and its data, however, broadcasters are also spinning the ratings in their favour. Among the top three channels for English-language news—Times Now, CNN IBN and NDTV 24x7—there isn’t a clear leader, Rao told me. “It’s touch and go, week after week.” Nevertheless, Rao said, each of these channels uses TAM’s numbers to advertise that it is the most popular. “They dissect the data, and view it from every possible angle” to claim the number-one position. What gets lost in the fine print is the market or subdivision of a market—for example, male viewers, 25 to 44 years old, in the top two socio-economic segments, in four metros, between 9.30 pm and 10.30 pm, in the last 13 weeks—in  which a particular channel is number one. Several channels even advertised leading in viewership for the September 2010 “Ayodhya Verdict”.

Other large media and advertising agencies also use TAM ratings even though they claim to have their own data. “In fact, much more reliable data,” said Lynn de Souza, head of Lowe Lintas, one of the biggest agencies in the country. According to de Souza, the “parallel data” her company has are much deeper and more strategically important to decisions about the channels on which it places advertisements. But TAM’s numbers still serve a purpose. “We use the TRPs as a currency, when we’re negotiating with the broadcasters” on advertising rates, de Souza said. Arvind Sharma, chairman of Leo Burnett for South Asia, said his advertising firm uses TAM’s ratings in a similar way.

In other words, no one will advertise with a broadcaster just because its TAM ratings are high. (“There was this one particular news channel that had large numbers,” the India CEO of an international media agency told me, but they could still not get the big advertisers because of their down-market reputation; he later revealed that the channel was India TV.) If a broadcaster’s ratings are low, however, it will not be able to command decent prices from advertisers.

Making money in the news broadcast industry is a zero-sum game. The money that one broadcaster loses—whether due to the quality of its content or to the allegedly inadequate and corrupt ratings environment—inevitably fills the coffers of rival channels. The effect of all this is to encourage news broadcasters, for the sake of their profits, to chase, manipulate and even attempt to buy ratings that many industry insiders consider highly suspect.

But the problems with TAM ratings are only one part of a broader challenge to the viability of India’s television-news industry. “TV news is not a profitable business,” a senior television journalist told me. Through a number of morally and economically questionable mechanisms, the entire model of how a channel should earn money has been flipped on its head. “The economics,” said Rao, “are completely screwed up.” This, in turn, has consequences for what counts as news in India and how that news is made.

(TWO)

EARLIER THIS YEAR, NDTV (which owns NDTV 24X7, NDTV India, NDTV Profit, and two other channels) became so fed up with the state of the ratings system that it took the matter to court. In a 72-page lawsuit filed in New York in October, NDTV demanded over $700 million in compensation for losses to its finances and goodwill due to “breaches of contract, negligence, tortious misconduct and conspiracy to defraud NDTV in connection with [the] continued exploitation of corrupted, manipulated and fraudulent … television ratings”. The lawsuit, which is a revised version of a complaint originally filed in July, names as defendants AC Nielsen Company (and three other Nielsen companies), and WPP and its subsidiary Kantar Media. (All of these firms have offices in New York, where, according to the NDTV executive, the broadcaster hopes to receive a faster legal decision than it would in India. TAM itself, which has no presence in New York, has not been made a party to the revised lawsuit.)

According to NDTV, the way audience data are collected leaves the ratings open to corruption, in which TAM’s parent companies are allegedly complicit. TAM has a panel of 8,150 homes in urban India, each of which is equipped with a PeopleMeter. This gadget connects to a television and records which shows are watched in a household and by whom. TAM then extrapolates from the data recorded by PeopleMeters to estimate the popularity of channels and programming in locations across the country.

READER'S COMMENTS [7]

So long one can hold on to Cable, its been replaced everyday by DTH. Look at numbers of DTH users today compared to 5yrs back. I think all DTH providers should have their own Rating system. TAM system is hugely flawed. With so many DTH providers they now have the power to change and give us accurate data.

brilliant article!!!

Wonderful Insight. Most are Facts but what is the way ahead. Who will bell the CAT!!!!!!!!!!. We do not want NDTV to Wind -up after so much of effort been put. Lets all clean the mess. Who ever whats to hier me. Please contact

Yes.. true to what I know about this.. I had interviewed a senior exec of WWIL 7 years ago.. When they go to collect the subscriber fees they take what they can get from the MSO.. The MSO's who dont have the political clout (like sun) apprently dont get much either.. They take what's given by the operators (It's like, take it or leave it..) This pilferage happens at the ground level where the collection field agents of MSOs are bribed mostly and in the worst case physically threatened to accept lower subscription numbers. In the exact words of the exec as he told me .. ".. The cablewallah puts a gun and a bundle of money on the table.. Chose the money or the gun and dont come again till next year... " This industry sucks big time and the cable operators would go any length to maintain the status quo.. The cable operators have consistently blocked implementation of digitization and their lobby has been strong in preventing import of chinese set-top boxes which are way cheaper thus rendering the digitization exercise a costly affair to consumers.. The only hope is internet streaming.. !!!

Brilliant piece. Great insight into the rot at the heart of Indian TV broadcasting.

i have been reading CARVAN's article from past month. One thing i don't like is Length. magazine and internet are two different things. On internet article should be to the point. Who will read a 5 page essay? because no-one can stare at computer screen for that much time. Do include Facebook comment plugin in your website. I would love to discuss news with other bright indians!

Well sir, with all due respect, I actually like Caravan for it's long articles that go deep into the issue, instead of TOI-like articles that just superficially skim the surface. For someone on the go who does not have the time to read a whole magazine (and does not want unread issues piling up at home) but still wants to read serious issues, the website is a boon.

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