Industry Perspective: Govind Shahi on 2020 – The year of disruption
2020 has been a year like no other, with the coronavirus pandemic taking the world by force and causing national lockdowns in countries across the globe. Since the first national lockdown in England in March, with schools and offices shut for the better part of the year, it came as no surprise that TV viewership increased exponentially as individuals were forced to stay indoors and isolate themselves from reality. The sudden surge in viewing meant that Ofcom was able to report that people were spending a whopping 40% of their day watching TV and online streaming services.
Ofcom reported, “As people across the UK followed official health advice to stay at home during April, they kept themselves informed and entertained by spending an average of 6 Hours and 25 Minutes each day watching TV and online video content – a total of almost 45 Hours a week, and a rise of almost a third on last year.”
The biggest factor behind this increase was people spending twice as much time watching subscription streaming services (Non-Asian) and not surprisingly this trend was even higher among 16-34-year-olds.
Channels like Colors and Star Plus experimented with re-runs of much older shows like ‘Mahabharat’ and managed some success…
For the Asian channels however, who rely on homegrown formats and soaps it was quite a challenge as a few days post the lockdown here, Mumbai – the heart of soaps production city went into lockdown too. Channels had to resort to repeat programming and Asian viewers who are high consumers of TV in any case had already seen some of this. Channels like Colors and Star Plus experimented with re-runs of much older shows like ‘Mahabharat’ and managed some success from that but largely impacts – a measure on how channels are paid from mainstream advertisers went down. From an ethnic advertising point of view, closed shops, closed cinemas, closed airports, and shuttered restaurants meant that much of the ethnic advertising had disappeared. Concerts /events that got cancelled only added to these woes.
Let us have a look at how this impacted the three main genres of South Asian TV channels:
GECs – The Cash Cow
The year so far has been quite challenging as while overall viewership across television has grown on the top GEC channels, January – November impacts (the way TV channels make money or rather monetise the eyeballs) have fallen. When one looks at impacts for the 16+ Adults on channels like ZEE TV, Sony TV, Colors, Star Plus, Hum Europe and Geo TV, there is a drop of 16% which by simply analogy would suggest that there is a drop of 16% in revenues across TV channels. This is however compounded by the fact that mainstream sell on CPT’s which have also dropped creating a much bigger hole in revenues %. This figure really boils down to individual channel agreements with sales houses and would therefore vary by network.
The trend looks even more disappointing when one looks at data across the same channels for the time period which most channels have as their fiscal year i.e. financial year. So, when looking at April – November 2020 data, the drop in impacts increases to 20% overall. Align this with the CPT factor and one will realise how difficult is it becoming for networks to make money.
The Second GEC – Cherry on top
When one extends this to the Second GEC where one can compare Colors Rishtey, Sony SAB TV and Star Bharat, the story continues. The drop is smaller at 10% for January – November 2020 and 9% for the fiscal period April – November 2020.
The Third Genre – Movies
On the third genre, the trend is much better where the January – November 2020 drop is a mere 5%. The channels compared in this are Colors Cineplex, Star Gold, ZEE Cinema, Sony Max, Sony Max 2 and B4U Movies however, when we move the data set to the financial year, this increases to 8%.
The health of the networks so far seems to be challenging leading to rumours that certain networks may shut shop in the next few months. That will be quite a loss for the viewers unless one additionally subscribes to another medium of non linear distribution (networks considered are Star, ZEE, Sony and Colors).
New trends are emerging with a new way of living and doing business in these changing times.
The situation however, changed as soon as the lockdown in India eased and new programming started making a comeback. Impacts started inching forward and networks started garnering revenue. Big ticket formats across 2 networks ignited large volumes of sponsorship led sales and set the wheels in motion again for Asian broadcasting. And then, the government announced a second lockdown right during the peak of the Indian festival of Diwali where people/advertisers tend to spend a lot of their budgets.
The story continues through the course of 2020 as such an unpredictable crisis has hit the world and every possible industry globally we are facing an extremely challenging and evolving scenario thanks to the invisible enemy however new trends are emerging with a new way of living and doing business in these changing times.
The first lockdown disturbed the entire ecosystem. It forced us to get creative and how! Our audiences connected with the networks in different ways, communication and messaging changed and technology enabled us to keep the connect with audience growing. The social media engagement numbers have been encouraging and show that audiences continue to enjoy this content. The industry just needs to innovate with evolving times. With over 800k individuals already getting the vaccine and with the government approving the Astra Zeneca Vaccine this week, the future looks promising.
The Asian TV industry has displayed resilience and agility in 2020 and will emerge stronger by continuing to find its own solutions in the coming year and combat this evolving challenge.
Govind Shahi is the Executive Vice Presidentm Head International business at IndiaCast Media. IndiaCast operates Colors, Colors Rishtey and Colors Cineplex in the UK.