Micro Economics Presentation

Electronic Media Industry

Saira Ansari (03) Suyash Gupta (09) Dhruvin Shah (20) Rajiv Siddhartha (21) Vinit Shah (29)

What exactly is media??? •

Channels of communication that serve many diverse functions, such as offering a variety of entertainment with either mass or specialized appeal, communicating news and information.

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Available types of media include print, electronic, out-of-home, and direct mail.

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As technology advances, new forms of media are being discovered every day, such as movie-house advertising and special automatic telephone devices with prerecorded advertising messages .

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We in our presentation are concerned with electronic media - Electronic media are usually referred to as broadcast media, or radio and television, including cable .

What exactly is media (contd.) • Any single form of communication is known as a medium.

What exactly is Electronic Media??? • Electronic media are media that utilize electronics or electromechanical energy for the end user to access the content. • The primary electronic media sources familiar to the general public are better known as video recordings and audio recordings . • Although the term is usually associated with content recorded on a storage medium, recordings are not required for things like live broadcasting.

Industry Outlook • Media Industry is one of the fastest growing sectors – not only in India but the rest of the world. • Universe of 219 million households in India • Colour TV homes have increased to 64 million from 58 million last year. • Television has been identified as the strongest medium to reach the early 20s target group , which is the most active media consumer and has the highest purchasing power. • Efforts are been made to redefine distributive strategies

Industry Outlook (contd.) • Economic growth, consumerism, rising income levels coupled with technological advancements and other key initiatives are the key factors. • The Electronic Media Industry is poised to grow at 19% compound annual growth rate to reach Rs 83,740 crore by 2,010 from its present size of Rs 35,300 crore. • The Electronic Media industry is forecasted to outperform the economic growth till the year 2010.

Industry Outlook (contd) • The stupendous growth which is occurring in the electronic media industry is without much government support • An interesting fact is that an urban cable home in the 4 metros currently receives approximately 100 TV channels • Global Media Majors like Disney and Bertelsmann have announce their entry into Indian screens , but the ground scenario is different. • The competition prevailing in the industry is mainly Oligopoly.

Projected Growth

Industry Leader- Star TV Network • Launched in India in 1991 with just 5 channels STAR pioneered satellite television in India as well as in Asia . • Pioneered explosive growth in the media industry across the region. • Today STAR provides sixty services in nine languages • Sports, documentaries , movies and daily soaps are few types of entertainment offered by STAR TV network. • Reaching over 300 million viewers in 53 countries across Asia , it is watched by 100 million people everyday.

Channel Bouquet

Channel Share

• Even though the share of STAR Network has fallen in 2006 , it still has over half the market share, hence it is clearly the leader. • The next competitor, namely ZEE TV , has less than half the share that Star holds.

Gross Rating Points

• GRP (short for Gross Rating Point) is the sum of ratings achieved by a specific media vehicle or schedule.

Challenges • Currently the media penetration is poor in lower socio-economic classes, but efforts to increase it even slightly are likely to deliver much higher results, simply due to the absolute numbers being large. The sector needs a consistent and uniform media policy for increase in investments. • Also, the ongoing threat of piracy, which continues to hinder investments in all sectors, needs efforts not just by the industry bodies, but by government, with empowered officers enforcing anti-piracy laws. • The steady eating up of market share by ZEE.

Challenges (contd.) • The broadcast media pricing has been frozen for over a year now, as per the notification issued by the TRAI. • Since the market has been so efficiently regulated through competition, price regulation would limit the STAR TV networks ability to shape their business models based on the market demand and the competitive environment . • The major issue faced by the industry is the lack of infrastructure. India has the challenge of building a broadband digital network to reach every city, every village, every home and every office.

Opportunities • The channel bouquet of Star has expanded to include regional channels that can be a source of growth since a vast majority of the untapped market is in the rural areas. • The size of the industry is just going up and hence any presence in any of the sectors of the Electronic media is likely to yield dividends.

Opportunities (contd.) •

The future of the STAR TV network will be driven by technology giving a bunch of value-added features to the consumers and new revenue streams for the players in each segment.

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The STAR TV network along with Television industry as a whole will continue enjoying a lions share in the E&M industry and is expected to continue growing rapidly and reach INR 371 billion by 2010 .

Demand Forecasting • Multiple Regression • Y= a +b1X1+ b2x2 • The dependent variable is the income of Star TV network. • The first independent variable is the advertising revenue of the company. • The second independent variable is the number of channels.

Thank You !!!!