‘The endgame is near for both TV 18 and NDTV’

SHARANYA KANVILKAR writes from Bombay: Indian media houses, generally speaking, have been cagey in reporting the economic downturn and what it is doing to the man (and woman) on the street. They haven’t ignored it, of course, but they have been, let’s say, less boisterous than they were when reporting the boom.

At one level, this is because of the widely held belief that gloom doesn’t sell. “Let us report what is happening, but let us not amplify it too much,” one top Hindi publisher wrote in an email to several co-publishers a few months ago. At another level, this is because of the belief that the blip was temporary and the good times would soon be back.

The good times may soon be here, so help me god, but will they be for India’s most glamourous television houses?

Moneylife, the personal financial magazine run by India’s pioneering business investigative journalist Sucheta Dalal and her husband Debashis Basu, has a special report on the state of of TV18, the BSE-listed company of Raghav Bahl (in picture), which runs CNBC-TV18 and the Hindi business channel CNBC Awaaz, among other businesses.

It is nothing short of eye-popping.

“Bleeding to Death?” reads the headline.

The story, authored by Debashis Basu, talks of the “horrifying story of cyclical revenues and non-cyclical costs,” and it warns that “things may only get worse”.

It compares TV 18′s current plight with NDTV’s.

“Both are losing profusely. Losses were a little lower when the [Indian] economy grew by 9% and the market euphoria fetched the two groups newer dumb investors and more money to keep going. But now, both are nearing this endgame.”

In broadcasting (CNBC TV18 and CNBC Awaaz), Basu writes that revenues are down and profits have collapsed due to higher costs. In web (moneycontrol.com, in.com, etc) revnues of Rs 65 crore have been overtaken by losses of Rs 66 crore. The newswire and printing businesses are not doing too well either.

Basu writes that TV18′s financial situation today is the result of accumulated sins of the past couple of years: the expansion of web-based businesses with no profitability in sight, huge expenses on staff and stock options, to finance which the company stares at a mountain of debt close to Rs 850 crore.

Even with the stock markets clawing back, Basu concludes that “the problems of TV18 have just started” because the economics of the business has changed with the entry of new players like ET Now, and with rumours of heightened competition in the form of Bloomberg.

“The big issue for TV18 is exactly what hit NDTV a few quarters earlier: how to keep funding the losses? One way out is taking on more debt hoping that the businesses would reviee…. Or get foreign media companies to buy your story….

“Even if there is value in some parts of the group, Raghav Bahl has locked up that value in a complicated group structure that got created when he funded these businesses as a network of entities, not independent businesses. So squeezed between competition on one side and cash crunch on the other, the endgame for TV18 begins.”

IBN18, which runs CNN-IBN, IBN Lokmat, IBN7, have always been losing money.

Read the full TV18 article: Bleeding to death?

Read the full NDTV article: Reality show

Also read: How the Indian media dream went sour

Is this man the new media mogul of India?

26% of India’s most powerful are media barons

The 11 habits of India’s most powerful media pros

One rule for Modi, another rule for Chidu?

PRITAM SENGUPTA writes from New Delhi: Saturday afternoons don’t figure highly on the radar screens of TV channels. Because they are all in the “hills” smoking cigars, eating caviar, and calculating how much richer the soaring valuations have made them in the week gone by, channel heads all believe this is the time when the aam janata, after biryani and a glass of beer, are too groggy to pay attention and keep the “People Meters” ticking.

So this is when they sneak in soft not-so-newsy stuff—travel, food, books, letters, automotive, spirituality, gadgets—and other “events” and other stuff designed to keep in the media plans of advertisers.

But the afternoon of Saturday, 1 March 2008, was different. It was the day after the 2008-09 budget had been presented by P. Chidambaram. And it was the afternoon the Union finance minister had decided to give his traditional post-budget interviews to the media after (presumably) a nice Chettinad lunch.

Network 18 with two business channels in its bow—CNBC-TV18 and CNBC-Awaaz—was given first shot.

Its managing director Raghav Bahl was to conduct the pow-wow and all morning, the network’s channels, including CNN-IBN, promoted the “First Post-Budget Interview”. It was to begin at 2.50 pm. But, as an eager nation waited for PC to explain what he had done, the clock stretched to 3 pm. Finally, it began at 3.15 pm.

Most of Bahl’s initial questions were on the waiver of loans for small and marginal farmers that is said to cost the nation Rs 60,000 crore. Where is he going to find the funds for it, Bahl asked—and asked—and asked. Chidambaram guffawed and gave that trademark “Look-I-went-to-Harvard-how-many-of-you-did” smirk which reporters from North Block to Sivaganga dread.

When Bahl continued to insist on an answer, PC said helpfully: “Look, whatever way you try to get it out of me, I am not going to reveal it on a TV show when Parliament is in session.”

But Bahl wouldn’t give up. And when he asked once more, PC said: “Look you are wasting your time. You might as well squeeze in your other questions.”

When an unrelenting Bahl pushed again, Chidambaram said “That’s it,” got up and walked out of the interview, while Bahl, who uses a walking stick, sat in his chair.

End of interview within three minutes.

Live.

You didn’t see the walkout “live” in your hypogogic haze, did you?

I did.

And the moment I saw it, my mind immediately raced back to Narendra Modi‘s famous walkout from an interview with Karan Thapar last October. That walkout was sparked when Thapar insisted on a “regret” from the Gujarat chief minister for what was allowed to happen in the aftermath of the Godhra train blaze.

First a Modi walkout, then a Chidambaram walkout, that’s yet another CNN-IBN “exclusive”, I thought.

But while the Modi walkout was the meat and drink for the channel and other media for days on end, news of the Chidambaram walkout has been very nearly blacked out. The walkout wasn’t replayed endlessly on CNN-IBN or CNBC in the evening bulletins on Saturday. The walkout didn’t become the “Image of the Day”. And the walkout finds no mention whatsoever in Raghav Bahl’s report of his interview on IBN Live.

So, what gives?

As the home of two business channels, with a Hindi business newspaper coming up, Network 18 cannot obviously afford to rub the finance minister on the wrong side. With a partnership with Forbes coming up, and countless FDI/FII/FCCB deals coming up, Network 18 cannot obviously make an issue of this minor conflagration.

Still, can there be one rule for Modi, and another rule for Chidambaram?

One rule for a chief minister with a past; another rule for a market-friendly finance minister?

One rule for a BJP man, another for a Congress man?

To his credit, Bahl eventually managed to convince Chidambaram to address the nation in his smug, supercilious best once again. So some lost ground was recovered. But as Chidambaram’s “first” interview on Network 18 and his second interview with NDTV aired at more or less the same time, the irony was stark and striking.

Cross-posted on churumuri