Posts Tagged ‘Sucheta Dalal’

Will Indian readers pay to keep their money safe?

19 April 2013

For all the talk about the future being digital, the truth is no Indian newspaper or magazine (or website) is making money at the speed and in the quantum that publishers and promoters feel they are entitled to.

Worse, no Indian newspaper or magazine (or website) has been able to generate the kind of content that readers won’t find elsewhere and will therefore pay to read.

Publishers are still groping around for a revenue model for charging online content. The Times of India is apparently inclined to but will only do so with Hindustan Times also on board.

Notwithstanding all this, Money Life, the personal finance magazine launched by the journalists Sucheta Dalal and Debashis Basu has gone full steam ahead.

A Rs 780 annual subscription gives copies of the print magazine, access to the website and web content, including the archives from 2006,  daily and weekly newsletters of news and views, and membership of the magazines initiatives. There is also a monthly pass for Rs 99.

External reading: Why Money Life went behind a paywall

Will RIL-TV18-ETV deal win SEBI, CCI approval?

9 January 2012

PRITAM SENGUPTA in New Delhi and KEERTHI PRATIPATI in Hyderabad write: Media criticism in India, especially in the so-called mainstream media, has never been much to write home about.

Operating on the principle that writing on another media house or media professional means exposing yourself to the same danger in the future, proprietors, promoters and editors—most of whom have plenty to hide—are wary of taking on their colleagues, competitors and compatriots.

That risk-averse attitude amounting to a mutually agreed ceasefire pretty much explains why the biggest media deal of the decade—Reliance Industries Limited (RIL) funding Network 18/ TV 18 group to pick up ETV—has been reported with about as much excitement as a weather report.

That the newspaper which issues P. Sainath‘s monthly cheque, The Hindu, declined to publish media critic Sevanti Ninan‘s fortnightly column on market rumours about the impending deal (without telling readers why) provides a chilling preview of what lies in store as the shadow of corporates lengthens over the media.

In 2008, New York Times‘ columnist Anand Giridharadas wrote of why the Indian media does not take on the Ambanis of Reliance Industries in an article titled “Indian to the core, and an oligarch“.

“A prominent Indian editor, formerly of The Times of India, who requested anonymity because of concerns about upsetting Mr Ambani, says Reliance maintains good relationships with newspaper owners; editors, in turn, fear investigating it too closely.

“I don’t think anyone else comes close to it,” the editor said of Reliance’s sway. “I don’t think anyone is able to work the system as they can.”

***

First things first, the RIL-Network18/TV18-ETV wedding is an unlikely menage-a-trois.

Reliance Industries Limited is a behemoth built by Dhirubhai Ambani and his sons Mukesh Ambani and Anil Ambani using a maze of companies and subsidiaries built on a heady cocktail of mergers and demergers, using shares, debentures, bonuses and other tricks in the accounting book—and many beyond it.

The only known interest of the Ambanis in the media before this deal was when they bought a Bombay business weekly called Commerce and turned into the daily Business & Political Observer (BPO) to match the weekly offering, The Sunday Observer, which they had acquired from Jaico Publishing.

(Top business commentators like John Elliott and Sucheta Dalal have alluded to a blog item to convey that Mukesh Ambani’s media interest goes beyond the recent announcement.)

Anyway, BPO, launched under the editorship of Prem Shankar Jha, was long in coming unlike typical Reliance projects. Suffice it to say that in 1991, when India was at the cusp of pathbreaking reforms, some of India’s biggest names in business journalism were producing dummy editions of BPO.

The Ambani publications were under the gaze of the more media-savvy younger brother, Anil Ambani, who operated with R.K. Mishra, the late editor of The Patriot, as chairman of the editorial board. The Observer group shuttered before the beginning of the new millennium.

As Mani Ratnam‘s film Guru based on Sydney Morning Herald foreign editor Hamish McDonald‘s book The Polyester Prince makes clear, the Ambanis have always cultivated friends across the political divide, but they have been identified with the Congress more than the BJP.

Raghav Bahl‘s Network18/TV18 is in some senses an ideal fit for RIL.

Till its latest cleanup came about a year and a half ago, it was difficult to understand which of its myriad companies and subsidiaries came under which arm. It too has friends on either side, but suffice it to say, CNN-IBN‘s decision not to run the cash-for-votes sting operation in July 2008 revealed where its political predilections lay.

Eenadu and ETV, on the other hand, is a long, different story.

***

The ETV network of channels was launched by Ramoji Rao, the founder of the Telugu daily Eenadu. Rao has many claims to fame (including launching Priya pickles), but he is chiefly known as the media baron behind the transformation of the Telugu film star N.T. Rama Rao into a weighty non-Congress politician.

Rao and his men are known to have crafted speeches that tapped into dormant Telugu pride for the politically naive NTR. The massive media buildup in Eenadu—Ramoji Rao pioneered multi-edition newspapers with localised supplements—saw NTR become the chief minister of Andhra Pradesh just nine months after launching the Telugu Desam Party (TDP) in 1982.

Two years later, when NTR was removed from office by a pliant governor (Ram Lal) working at the behest of Indira Gandhi‘s rampaging government, Ramoji Rao played a key role in protecting the numbers of TDP MLAs by having them packed off to Bangalore and Mysore, and building public opinion through his newspapers.

When NTR’s son-in-law N. Chandrababu Naidu walked out of TDP to “save” TDP, Ramoji Rao backed Naidu and played a hand in his ascension as CM. Thus, Ramoji Rao galvanised non-Congress forces in the South leading to the creation of the National Front, which installed V.P. Singh as PM in 1989 after the Bofors scandal claimed Rajiv Gandhi.

In 2006, Ramoji Rao placed his political leaning on record:

“I submit that until 1983 the Congress was running the State in an unchallenged and unilateral manner for the past 30 years. The Congress party became a threat to democracy and in view of the single party and individual rule by Indira Congress, the opposition in the state was in emaciated condition. It has been reduced to the status of a nominal entity. The dictatorial rule of the Congress proceeding without any hindrance. I submit that as the opposition parties were weak and were in helpless situation where they were unable to do any thing in spite of the misrule by the ruling party, Eenadu played the role of opposition. I submit that in the elections of the State Assembly held in 1983, the Congress for the first time did not secure a majority in the elections and lost the power to the newly formed Telugu Desam Party. I submit that on the day of poling i.e. January 5, 1983, I issued a signed editorial on the front page of Eenadu supporting the manifesto of Telugu Desam Party and calling on the electorate to vote for Telugu Desam Party giving cogent reasons for the stance taken by me.”

In short, the marriage between RIL-Network18/TV18 and Ramoji Rao is one between a largely pro-Congress duo and a distinctly non-Congress one.

***

Indeed, Ramoji Rao’s troubles that has resulted in substantial sections of his ETV network getting out of his grasp and into RIL’s, are largely because of his consistently anti-Congress stance, which gained an added edge in 2005 when the Congress under Y.S. Rajasekhar Reddy (YSR) trumped the TDP under Chandrababu Naidu in the assembly elections.

Reported The Telegraph:

A slew of news reports in Eenadu and programmes on ETV since 2005 have accused Congress ministers, politicians and senior government officials of corruption and hanky panky. One report, for instance, debunked the official claim that the number of suicides by farmers had dropped. Another attacked construction by Y.S. Vivekananda Reddy, the chief minister’s brother, on disputed land. A third said that Eenadu had discovered, based on a survey, that voter lists for elections for local bodies had omitted the names of opposition party sympathisers.

It didn’t take long for YSR to hit back.

It was a two-pronged attack: his son Y.S. Jagan Mohan Reddy launched a project to own launch his own newspaper and newschannel house to take on the might of Eenadu and ETV. Simultaneously, a Congress MP from Rajahmundry attacked Ramoji Rao where it hurt most: his finances.

Arun Kumar Vundavalli, the MP, revealed that Rao’s Margadarsi Financiers had started dilly-dallying about repaying depositors, even after their deposit period had expired. Kumar showed that Margadarsi Financiers—a Hindu Undivided Family (HUF) company, of which the karta was Ramoji Rao—had collected deposits from the public, although a 1997 RBI law forbade HUFs from doing so.

Margadarsi Financiers owned a 95% stake in Ushodaya Enterprises, Ramoji Rao’s company which owned Eenadu and ETV.

A one-man committee of enquiry constituted by the Y.S. Rajasekhara Reddy government revealed that Rs 2,600 crore of money was collected from the public in violation of RBI norms. Although his companies were not in great shape, Ramoji Rao assured the Andhra Pradesh high court that he would repay the full amount of Rs 2,600 crore due to the depositors.

Enter Blackstone.

In January 2007, the world’s largest private equity player indicated that it wanted to pick up 26% in Ushodaya Enterprises group for Rs 1,217 crore. At the time, it was reported to be India’s single largest foreign direct investment (FDI) in the print media.

The Blackstone offer placed the value of Ramoji Rao’s company at Rs 4,470 crore.

But the FDI proposal got stuck in the I&B ministry for months, allegedly at the behest of Vundavalli, who raised a variety of concerns over the Blackstone-Eenadu deal. In January 2008, when the clearance for the Blackstone investment was still not coming, Mint asked:

“Does the promoter of an Indian company, who is selling a stake in his family’s media firm to a foreign investor, have the right to do what he wants with that money, in this particular case, pay off liabilities of another company that his family separately also owns?….”

“FIPB records then show that the finance ministry, specifically citing Vundavalli’s claims, ‘has observed that prima facie, it appears that the purpose of securing funds from M/s Blackstone is not for advancing the business of Ushodaya Enterprises Ltd, but for repaying the deposits taken by M/s Margadarsi Financiers.”

When the Blackstone deal did not materialise, Nimesh Kampani of JM Financial stepped in as Ramoji Rao’s white knight although, as Sucheta Dalal writes, Kampani was never known to have any interest in the media except in deal-making.

According to VC Circle, Kampani picked up 21% of Ushodaya Enterprises for Rs 1,424 crore, which valued the company at Rs 6,780 crore, or over 50 per cent more than what Blackstone was willing to accept.

“The first public report of Kampani’s investment came in early February 2008, or around 10 days after stock markets crashed globally.”

Now, YSR got after Kampani.

Andhra Pradesh police issued a “look-out” notice for Kampani. Nagarjuna Finance, of which Kampani had been director, had allegedly defrauded depositors. Although Kampani had resigned from the independent directorship of the company nine years earlier, it was a sufficient handle to beat him with.

For months, Kampani had to stay out of India, fearing arrest. It was only after his bete noire YSR met with a bloody death in a helicopter crash in September 2009 that Kampani could return home.(YSR’s death in the aircrash was itself not without controversy involving the Ambanis.)

In May 2010, rumours surfaced of Mukesh Ambani buying up JM Financial but they soon fizzled out.

Shortly before buying into ETV, Kampani had recently sold his stake in a joint venture with Morgan Stanley to his foreign partner for $440 million and had the cash. The Margadarsi bailout, it was assumed, was in his personal capacity. It took a petition in 2011 filed by YSR’s widow seeking an inquiry into Chandrababu Naidu’s assets assets for the penny to drop.

Enter RIL.

YSR’s widow, Y.S. Vijayalakshmi, an MLA, alleged that when gas reserves were found in the Krishna Godavari basin in Andhra Pradesh in 2002, the Chandrababu Naidu government wilfully surrendered its right over the discovery in favour of Reliance, “while allowing Naidu’s close associate Ramoji Rao to be the vehicle of the quid pro quo.” (page 32)

“In consideration for the favour done by the Respondent No. 8 (Chandrababu Naidu) in allowing the State’s KG basin claim to be brushed under the carpet, the Reliance group facilitated the payout of Ramoji Rao’s debts to his depositors. This was carried out through known associates and friends of Mukesh Ambani.

“Two of these known associates of Ambani and the Reliance Group are Nimesh Kampani (of JM Financial) and Vinay Chajlani (of Nai Duniya).

“Kampani extended himself in ensuring that Ramoji Rao would be bailed out. Within a short span of 37 days between December 2007 and January 2008, six “shell companies” were floated on three addresses, which are shown as Sriram Mills Compound, Worli, which is the official address of Reliance Industries Limited. Reliance diverted Rs 2,604 crores of its shareholders money through the shell companies to M/s Kampani’s Equator Trading India Limited and Chajlani’s Anu Trading.”

In other words, RIL’s involvement in Eenadu through Kampani became known only recently in response to Vijayalakshmi’s petition, but it was market gossip for quite a while.

T.N. Ninan, the chairman of Business Standard and the president of the editors’ guild of India, wrote in a column in January 2011:

“If reports in Jagan Reddy’s Saakshi newspaper are to be believed, Mukesh Ambani is a behind-the-scenes investor in Eenadu, the leading Telugu daily.”

Vijayalakshmi’s 2011 petition makes several serious allegations.

That Ramoji Rao entered into the deal with Kampani’s Equator just 23 days after it was registered although it had no known expertise or business; that Ushodaya sold Rs 100 shares to Equator at a premium of Rs 5,28,630 per share; and that Ushodaya’s valuation had been pumped up by Rs 1,200 crore by its claims over a movie library.

Vijayalakshmi’s petition concluded:

“The interest shown by Reliance group in coming to the rescue of Ushodaya Enterprises headed by Ramoji Rao is clearly in defiance of any prudent profit-based corporate entity (since) Reliance does not gain any returns by virtue of that investment.”

***

It is this RIL baby that is now in Network18/TV18′s lap.

The timing of the RIL-Network18/TV18-ETV deal also hides a small story.

It comes when the probe into the assets of Naidu and his associates (including Ramoji Rao) has moved from the High Court to the Supreme Court. It comes when a parallel probe into Vijayalakshmi’s son Jagan Mohan Reddy’s assets has entered a new and critical phase. It comes when the KG basin gas controversy is heating up. And, above all, it comes when 2014 is looming into the calendar.

Several questions emerge from this deal which has politics, business and media in varying measures:

1) What does it mean for Indian democracy when India’s richest businessman becomes India’s biggest media baron with control over at least two dozen English and regional news and business channels?

2) What kind of control will Mukesh Ambani have over Raghav Bahl’s Network18/TV18 when and if RIL’s optionally convertible debentures (OCDs) are turned into equity?

3) What kind of due diligence did the financially troubled Network18/TV18 do on the Kampani-Ambani investment in ETV before agreeing to pick up RIL’s stake for Rs 2,100 crore?

4) How will CNBC-TV18, which incidentally broke the news of the split among the Ambani brothers in 2005, report news of India’s biggest company (or its political and other benefactors) now that it is indirectly going to be owned by it?

5) Is there a case for alarm when one man has a direct and indirect stamp over three of the five major English news channels (CNN-IBN, NewsX and NDTV 24×7), three business channels (CNBC-TV18, IBN Awaaz, NDTV Profit), and at least five Hindi news channels?

6) Do Raghav Bahl and team who ran a handful of channels heavily into debt, have the expertise to run two dozen or more channels, especially in the language space where there are bigger players like Star and Zee?

7) Is the ETV network really worth so much, especially when Ushodaya’s most profitable parts, Eenadu and Priya Foods, are out of it? Or is RIL using Network18/TV18′s plight to turn a bad asset into a good one?

8) Is RIL really tying with Network18/TV18 with 4G in mind, or is this just spin to push an audacious deal past market regulators such as SEBI and the Competition Commission of India (CCI)?

9) How immune are Mukesh Ambani and Raghav Bahl from political forces hoping to use the combined clout of RIL-Network18/TV18 to blunt negative coverage ahead of the 2014 general elections?

10) And have Network18/TV18 investors got a fair deal?

***

Infographic: courtesy Outlook

Also read: The sudden rise of Mukesh Ambani, media mogul

The Indian Express, Reliance & Shekhar Gupta

Niira Radia, Mukesh Ambani, Prannoy Roy & NDTV

Niira Radia, Mukesh Ambani, NDTV & Prannoy Roy

19 May 2011

In conversation number #132 in the infamous Niira Radia tapes, the lobbyist whose name has become synonymous with the 2G scam, talks to M.K. Venu, then of The Economic Times, in July 2009:

Venu: Is Manoj (Modi) is here (in Delhi) today also, no?

Radia: Yeah, he is here, he is leaving in the afternoon, later part of the afternoon. We are meeting Prannoy (Roy of NDTV) today. We need to support Prannoy, you know… We feel it needs to be supported.

Now, the penny drops.

Money Life, the personal finance magazine run by the investigative journalist Sucheta Dalal, reports that the American investment firm D.E. Shaw has picked up a 14.2% stake in NDTV, providing an exit to another blue chip investor, Goldman Sachs, which held an equivalent stake.

Reports Money Life:

“Interestingly, the D.E. Shaw investment in NDTV has happened in less than two weeks since it joined hands with Reliance Industries Ltd (RIL) to enter the Indian financial services sector. Now we know that Mukesh Ambani has a soft spot for NDTV’s promoters and anchors and that they had previously approached him for an investment.”

Manoj Modi is Mukesh Ambani’s Man Friday. Niira Radia represented Mukesh Ambani and counted NDTV Imagine among her many clients before the 2G scam broke.

M.J. Akbar‘s Sunday Guardian reported in March that Radia was behind the January 2010 launch of a book by bureaucrat-turned-politician N.K. Singh in London, for which Ambani, Venu and NDTV’s Barkha Dutt travelled together on the same plane.

Read the full article: NDTV continues to find buyers

Listen to the conversation: #132 M.K. Venu: July 09, 2009

‘Why Barkha Dutt needn’t return her Padma Sri’

5 February 2011

Anurag Batra, editor-in-chief of the exchange4media group, in the industry journal, Impact:

Prabhu Chawla was awarded the Padma Bhushan in 2003. What’s fascinating is that between 2006 and 2009, six journalists were awarded the Padma Sri: Sucheta Dalal, Mrinal Pande, Vinod Dua, Rajdeep Sardesai, Barkha Dutt and Abhay Chhajlani, and one Padma Bhushan, Shekhar Gupta in 2009.

“Three out of the six Padma Sris were awarded in 2008 itself, the penultimate year of the UPA government before the elections in 2009. I remember laughing out loud when the awards were announced, as these leading journalists held debates on their respective channels about the authenticity of these awards. Not to mention that when they got it, nobody denied them or denounced them, instead the channels hailed their achievements.

“The latest on the grapevine is that the AIADMK and a few other parties are running a campaign to get Barkha Dutt to give back her Padma Sri award because of the Niira Radia controversy. I personally don’t see the point in that as in my view, Barkha has done good work in the past and continues to do so and should be judged on that. I also feel that journalists have always been influencers so there is nothing new in that.”

Also read: Padma Shri VD, Padma Shri RDS and Padma Shri BD

2008: Why Rajdeep and Barkha must decline the Padma Sri

2009: Third highest civilian honour for Shekhar Gupta

2010: Newsweek’s Fareed Zakaria gets Padma Bhushan

2011: Padma Awards for Homai Vyarawala, T.J.S. George

 

The decentralisation of paid-for news begins

24 March 2010

The election commission of India likes to pretend that it came to know of the phenomenon of “paid news”—advertisements being slipped in under the garb of news to circumvent expenditure norms— only after recent reports of its widespread use during the 2009 recent general elections.

Well, here’s more news for the EC.

A journalist with Citizen Matters, a civic awareness magazine published from Bangalore, writes that she was offered money to write about candidates from three mainstream political parties contesting elections to the civic body in India’s IT capital.

Vaishnavi Vittal writes that an aide of a first-time candidate in ward no. 177 (J.P. Nagar)  tried to slip her a bunch of 100-rupee notes neatly folded in his palm. “Nimma expenditurege (for your expenditure), madam”, he said sheepishly. Less than an hour later, in the same ward, another candidate pulled out wads of 500-rupee notes from his pocket and asked me, “Hana yenadaru kodabeka? (Should we pay you any money?)”

“A similar incident occurred with a party candidate contesting from Sarakki (Ward 178). After the interview, the candidate’s spouse and campaign coordinator repeatedly asked me if they need to pay me for the interview. They went on to add, laughing all the while, that they are ready to pay money even if we don’t ask for it.

“The two of them gave me a copy of a local Kannada publication in which there were several reports, profiling some of the candidates. They told me that they had paid for a report on their party candidate on the front page.”

Read the full article: Cash for coverage comes to BBMP elections too

Link via Kanchar Kaur-Hariharan

Complete coverage: Editors’ Guild on paid news, private treaties

Pyramid Saimira, Tatva & Times Private Treaties

Times Private Treaties gets a very public airing

SUCHETA DALAL: Forget the news, you can’t believe the ads either

Does he who pays the piper call the tune?

SALIL TRIPATHI: The first casualty of a cosy deal is credibility

Selling the soul? Or sustaining the business?

PAUL BECKETT: Indian media holding Indian democracy ransom

Does he who pays the piper call the tune?

PRATAP BHANU MEHTA: ‘Indian media in deeply murky ethical territory’

The scoreline: Different strokes for different folks

A package deal that’s well worth a second look

ADITYA NIGAM: ‘Editors, senior journalists must declare assets’

The brave last words of Prabhash Joshi

‘Only the weather section isn’t sold these days’

It takes 3 Idiots to call the bluff of Pauper Tigers

If you trust polls, trust in Indian media dips

It takes 3 Idiots to call the bluff of Pauper Tigers

16 March 2010

The prostitution of Indian journalism by pimps, promoters and proprietors selling editorial space without letting the reader know what is independently verified news and what is a paid-for advertisement in the garb of news, has attained pandemic proportions.

“Paid News”, as the trend has been sadly named, happens not just during election time, but in between elections too. It afflicts not just the language media, but mainstream English media too. It is not just political news that is coloured, but business, sport, cinema and everything else, including the TV listings.

Above all, it is not something that small papers and extortionists are indulging in to keep their business going; it has become a revenue stream for profitable media organisations to keep the ink black on the bottomline, as trust and credibility are thrown to the wolves by suited-booted “managers”.

The Rajya Sabha, the election commission and the press council are all seized of the issue.

The country’s #1 business investigative journalist Sucheta Dalal who has written fearlessly on the subject—a trend that has deep implications for Indian democracy and reader trust in the media in the long run—throws light on a scandal in which India’s top filmmaker was held to ransom by “a leading media house”.

***

By SUCHETA DALAL

Moneylife has often commented on the brazen sale of news by a leading media house. However, we also acknowledged that the group usually made a win-win offer which was tough for companies to refuse. After all, which company would want to say no to something as lucrative as assured positive coverage, plus a steep discount in advertising tariffs, in return for a small equity stake?

However, in recent times, companies complain about the strong-arm tactics used by the group’s media arm.

Several companies have reported that they are told to appear first on the group’s media channel, during the quarterly results announcements. A print interview is thrown in as a carrot. Or they can face the stick: the prospect of being black-listed by its large circulation dailies.

As for the group’s city supplement, it is not only common knowledge that all its pages are for sale, but it has even dropped the pretence that its news and photographs are anything but paid publicity material.

Yet, the group still managed to shock us, with its recent strong-arm tactics against a top-grossing Hindi movie.

Its director told us how the media-selling arm of the publishing house approached him with a ‘publicity package’ which offered a number of articles and photographs for a price.

The director said a polite ‘No’. He would buy advertisements to publicise the movie, but the editorial would be up to the publication. But he was in for a shock. He was told that if he did not accept the package, there would be no editorial coverage of the movie in any of the group’s publications.

Given the stakes involved in the movie business, the director consulted his partners and friends in Bollywood. Many supported his stand, while there were others who were quite happy to accept the offer. However, our director-friend put his foot down and invited several like-minded producers to discuss the implications of what he calls the ‘dadagiri of this brand’.

The publishing house representative apparently said the director was making a needless fuss. After all, “film journalism is not serious journalism” (suggesting there are no ethical issues in buying editorial coverage).

What is most heartening is that, unlike wimpy corporate India, a dozen top producers and directors got together, discussed the issue and had the courage to say no, even though their stakes are significantly higher. The media house, realising that the issue could get out of hand, then backtracked and actually wrote a letter of apology for trying to pressure the industry.

The story had a happy ending, because the movie went on to set success records.

Why has this not made news? Because Bollywood also realises that it needs big media and is not idiot enough to shoot itself in the foot. Moneylife doffs its cap to the producers who had the guts to say ‘No’.

Also read: Editors’ Guild on paid news, private treaties

Also read: Pyramid Saimira, Tatva & Times Private Treaties

Times Private Treaties gets a very public airing

SUCHETA DALAL: Forget the news, you can’t believe the ads either

Does he who pays the piper call the tune?

SALIL TRIPATHI: The first casualty of a cosy deal is credibility

Selling the soul? Or sustaining the business?

PAUL BECKETT: Indian media holding Indian democracy ransom

Does he who pays the piper call the tune?

PRATAP BHANU MEHTA: ‘Indian media in deeply murky ethical territory’

The scoreline: Different strokes for different folks

A package deal that’s well worth a second look

ADITYA NIGAM: ‘Editors, senior journalists must declare assets’

How much do readers distrust us? Not enough

The brave last words of Prabhash Joshi

‘Only the weather section isn’t sold these days’

Does he who pays the piper call the tune?

30 September 2009

NDMA-Letter

The media is pilloried, and rightly so, for erasing the line between editorial and advertising. Space sellers are slammed, and rightly so, for allowing advertisers and agencies to run riot. And publishers and editors are pilloried, and rightly so, for not standing up and telling advertisers, agencies and space sellers where to get off.

But what when the advertiser is the government, as the National Disaster Management Agency (NDMA) is?

And what when the government as advertiser tries to set the editorial rules and guidelines in a tight advertising market, when it tells you how to write the article, how to do the layout, and what kind of newsprint to choose, all in the name of public awareness?

Also read: Pyramid Saimira, Tatva & Times Private Treaties

Times Private Treaties gets a very public airing

SUCHETA DALAL: Forget the news, you can’t believe the ads either

SALIL TRIPATHI: The first casualty of a cosy deal is credibility

PAUL BECKETT: Indian media holding Indian democracy ransom

PRATAP BHANU MEHTA: ‘Indian media in deeply murky ethical territory’

The scoreline: Different strokes for different folks

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

31 July 2009

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

Times Private Treaties: the full list of ‘partners’

17 May 2009

The following is the full and unexpurgated portfolio of Times Private Treaties, the equity-for-ads investment arm of The Times of India group as on 11 May 2009.

The list of clients as per industry has had disappeared from the Times Private Treaties website following the recent media scrutiny, and the Google cache has had also been cleared [before it was recently restored].

tpt

Also read: Times Private Treaties gets a very public airing

SUCHETA DALAL: Forget the news, you can’t believe the ads either

SALIL TRIPATHI: The first casualty of a cosy deal is credibility

PAUL BECKETT: Indian media holding Indian democracy ransom

PRATAP BHANU MEHTA: ‘Indian media in deeply murky ethical territory’

The scoreline: Different strokes for different folks

Sucheta Dalal in public row on private treaties

Times Private Treaties gets a very public airing

11 May 2009

Miracles never cease, and Times Private Treaties (TPT), the investment arm of Bennett, Coleman & Co Ltd (BCCL), publishers of The Times of India group of publications, is suddenly the object of attention with two competing newspapers having chosen Monday, 11 May 2009,to turn their attention on it.

The first story by Shuchi Bansal and B.G. Shirsat in Business Standard, a competitor of The Economic Times, says the total value of Times‘ portfolio of the 240 companies in which it had invested cash in return for advertising has halved from Rs 2,700 crore to Rs 1,350 crore due to the stock market slump.

S. Sivakumar, the CEO and acting CFO of Times Private Treaties, contests the figure and denies the TPT model has collapsed. The total value of the business is closer to Rs 2,000 crore, he says, of which listed companies comprise only a small percentage; the unlisted companies have lost 40 per cent of their value.

Of the Rs 2,000 crore spent by BCCL in picking up stakes in companies in return for advertising, the group had served ads worth Rs 600 crore.

In other words, an inventory of ads worth Rs 1,400 crore is still to be exhausted.

***

The second story datelined 11 May 2009 on Times Private Treaties is served up by the Times‘ main competitor in Bombay, Daily News & Analysis (DNA).

Special correspondent N. Sundaresh Subramanian takes up the ethics issues raised by TPT’s investment in Pyramid Saimira, the company which was barred by India’s stock market regular recently following an alleged forgery involving Rajesh Unnikrishnan, an assistant editor at The Economic Times.

UTI chairman U.K. Sinha is quoted as saying this:

We are not very happy about these [ads-for-equity] deals. This is not a healthy development. This should not happen. The Securities and Exchanges Board of India has all the powers. It should act.

An unnamed “senior marketman” is quoted as saying: “If this is not brazen insider trading, what is?”

DNA, which puts the value of TPT’s portfolio at Rs 4,000 crore, says the story is not about a company’s bad portfolio of shares. “It’s about a toxic business model, whose noxious elements are contaminating the whole stock-market ecosystem.”

(DNA reports that the list of companies in which Bennet, Coleman & Co has a stake has been removed from TPT’s website following the controversy. The Google cache version can be found here.)

Logo: courtesy Times Private Treaties

SUCHETA DALAL: Forget the news, you can’t believe the ads either

SALIL TRIPATHI: The first casualty of a cosy deal is credibility

PAUL BECKETT: Indian media holding Indian democracy ransom

PRATAP BHANU MEHTA: ‘Indian media in deeply murky ethical territory’

The scoreline: Different strokes for different folks

Sucheta Dalal in public row on private treaties

PRADYUMAN MAHESHWARI: April 1 and the joke is on us (and them)

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