It is no secret that the Indian news media in print has been challenged by lower circulation and advertising revenues since 2017. Moreover, it was in trouble even before the pandemic years, particularly due to the onslaught of digital advertising and social media, which diverted ad revenues to the global big tech companies.
IppStar’s (www.ippstar.org) analysis of nine years of financial data Copyright IppStar 2024Then came the Covid-19 pandemic and the countrywide shutdown in March 2020 disrupting the logistics, subscriptions, and advertising of the Indian dailies. As shown by IppStar’s research (www.ippstar.org), in the three-year recovery from April 2021 to March 2024, our combined sample of the 35 newspaper groups has not reached its highest revenue figures for FY 2018-19. Nor did the same newspaper groups achieve their highest combined profitability in FY 2016-17.
Nevertheless, there has been a topline improvement in the past two financial years. Revenues and profits, however, may take another four or five years to recover to their earlier levels despite the overall buoyancy of advertising growth in the country.
The consensus within the industry is that circulation will never recover to earlier levels since large parts of the youth demographic are lost to digital news and social media. Although the latest data show that print has gained while television has also lost eyeballs to digital – the fastest growing digital revenues are from alternative media and small video makers described as ‘the content creation economy.’
Software lifted Indian language newspapers
Indian language newspapers are the most important beneficiaries of software and technology innovations in the last 50 years, which made the production of their dailies possible and profitable in their local scripts. With the advent of Adobe PostScript, and computer to full page on film, and subsequently computer output of full pages, including color images directly onto offset plates, the Indian language dailies grew and grew.
They launched multiple editions in their hubs and new editions at 150 to 250 kilometers in all directions in their language region. The advent of PDF and the Internet backbone across the country made it possible to transmit multiple pages or the entire newspaper to localized editions. Advertising booking software allowed national advertising to be shared to editions for incorporation in pages combined with regional ads for their localized print runs.
The biggest language dailies in the country that grew in the three decades from the 1980s to 2010, built anywhere from a dozen to 40 printing plants for producing local editions. They made good profits and ventured into television, radio, and Internet editions. A few raised money for their influential and fast-growing businesses with initial public offerings on the stock market and ventured into dailies in other regional language markets.
Stagnation in the digital era
This brings us to the era before and after the COVID-19 pandemic when the Indian news media was losing ad revenues to big tech and unable to sufficiently monetize its diversification into radio, television, and the Internet. Thus far, it has failed to get big tech to hand over a ‘fair share’ of ad revenues, unlike the news media industries in Australia, Canada, Europe, and Latin America. In those news markets, the governments and competition commissions compelled big tech to agree to revenue-sharing agreements. In several cases, hefty fines have been imposed on the most egregious defaulters for their monopolistic and unfair trade practices.
Nevertheless, the news media business in India is too influential and profitable to give up without a fight. Publishers see it as a vital contributor to development and democracy and are not going to give up easily to simply diversify to real estate development and other industries. For this purpose, they are searching for ways to improve their digital media monetization and rationalize their print operations. A leading news publisher has said that the survival of both large and small dailies is crucial for the survival and growth of democracy in the country. This survival hinges not only on credible content but also on efficiencies in newspaper operations including production.
Rationalization print operations
Rationalizing print operations can be done by decreasing circulation while maintaining or increasing circulation and advertising revenues – but this gets you only so far. One has to resist the temptation to add pages despite lower-priced advertising but while this will embellish the topline revenue, it will erode bottom lines as it already has in some cases. With depreciating infrastructure and machinery, other cost areas need to be looked at, including human resources and software. The human resource costs of Indian dailies have already been rationalized with contract jobs, work from home, and outsourcing, and our research of 35 major newspaper groups shows that these costs have been stable over the past five years. These costs may even rise in the coming years of fierce competition for the quality and authenticity of content.
This brings the focus on efficiencies in software – since other innovations seemingly require too much imagination and disruption. Open source, free-of-charge software has always tempted newspapers, and leading dailies from the South presented and discussed these at IFRA conferences as long as 20 years ago.
However, the license structure of the global off-the-shelf software suppliers moving to the subscription or SaaS model has made the case for abandoning many of the multiple licenses more cogent. It has brought immediacy and value to newspapers in shifting their assets to open-source software such as Open Office for text and spreadsheets, GiMP for image retouching, and Scribus for layout and page making.
