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IBN and CNN end their 10-year association; Turner starts talks with Zee

MUMBAI: Mukesh Ambani-controlled TV18 Broadcast and Turner International’s CNN have decided not to renew their brand licensing agreement, ending their 10-year association that established CNN-IBN as a popular English news channel brand.

Also ending will be the news service arrangement for use of CNN news content. TV18 Broadcast’s deal with CNN concludes in January 2016, both companies said on Monday.

English news channel CNN-IBN will, thus, have the brand name CNN dropped. It is not clear yet whether TV18 Broadcast will continue with the IBN brand or replace it with another name running common across its clutch of news channels.

CNN, it is learnt, has initiated talks with Subhash Chandra-controlled Zee Media Corporation Ltd (ZMCL), which runs Hindi and regional news channels. Chandra has been toying with the idea of launching English-language news channels, both in the general and in the business news space.

CNN logoAn international partnership will help Zee to foray into English-language news television, several media analysts said. CNN is a credible international news brand.

“If there is a tie-up, it will be beneficial for both. It is not clear whether they would be exploring an equity option. ZMCL owns and operates all the news channels of Zee. So an equity arrangement would mean the setting up of a separate JV where ZMCL will hold at least 74 per cent stake due to government regulation,” a media analyst at a broking firm said.

CNN has not said what its growth chart in India would be. In a joint statement, both the companies said: “The conclusion of the arrangement will enable each company thereafter to chart its own growth trajectory independently in one of the most dynamic, complex and fast growing markets in the world.”

CNN’s international channel has a niche audience base in India. The local news channels have an overwhelming share of the market.

CNN has not said whether it wants to pursue alliances in the Indian market. “As the number one international news brand in Asia Pacific and the rest of the world, and the winner of multiple prestigious awards, CNN International, continues to lead and serve consumers in India with the best of global news content across multi-platforms,” said CNN International chief commercial officer Rani Raad.

How TV18 looks at the separation

Mukesh_AmbaniTV18 has grown from a two-channel news network in 2005 to a wide spectrum of 17 news channels.

The brand association with CNN helped in those early years when TV18 founder-promoter Raghav Bahl was in charge and was in the process of building an expansive media empire.  But now the company is in the hands of India’s richest man, Mukesh Ambani, and the local brand has grown over the years.

Network 18 Group CEO A.P. Parigi echoes this sentiment. “At the launch of the channel, TV18 was a relatively small organisation; that has changed now.  Network18 has grown from two news channels in 2005 to 17 news channels in 2015. Today, we have the largest footprint in the current affairs, regional and business news space in India.  The TV18 line-up of channels today are well established and highly regarded in this dynamic, complex and challenging environment.”

CNN-IBN lAmba Preetham Parigiaunched on 16 December 2005. TV18 entered into a brand license agreement with CNN, under which it got the limited, exclusive non-transferable right to use the name and logo of CNN in India. Under this agreement, CNN could add or remove elements from its licensed material as it deemed necessary.

The company also executed a news service agreement with Turner under which it got a limited, exclusive license to receive and re-broadcast CNN programming content in India.

  • In April 2005, Raghav Bhal got former NDTV CFO Sameer Manchanda and the then NDTV managing editor and renowned TV anchor Rajdeep Sardesai to start Global Broadcast News (GBN). Sardesai, Manchanda and Haresh Chawla collectively held 26 per cent stake in GBN.
  • In October 2005, GBN announced partnership with Turner International to launch cobranded 24-hour English general news channel CNN-IBN.
  • GBN launched CNN-IBN in December 2005, which Raghav-Bahlquickly became the No. 1 English news channel.
  • The company paid content franchise fee (subscription and purchase charges for licensing or purchase of news content and footage) and royalty to CNN for use of their brand name and news content. As per available data, for financial year ended 31 March 2014, TV18 paid Rs 20.31 crore (Rs 203.1 million) in royalty for using brands like CNN and CNBC.
  • The only available data for the CNN brand is for a six-month period ended 30 September 2006 and for a 10-month period ended 31 March 2006, when it spent Rs 3.49 crore (Rs 34.9 million) and Rs 2.33 crore (Rs 23.3 million), respectively, for use of CNN brand and footage.
  • In 2006, GBN picked up a minority stake in Jagran TV, which had launched Hindi news channel, Channel 7. In different tranches over the next two years, Raghav Bahl-promoted GBN took full control of Channel 7 and renamed it IBN7.
  • In 2010, Raghav Bahl announced restructuring the business, in which the broadcast business of TV18, including the business news channels, was transferred to IBN18 (now TV18). It included CNBC-TV18, CNBC Awaaz, CNN-IBN, IBN7, and 50 per cent interest in Viacom18 channels (Colors, MTV, Vh1 and Nick) and IBN Lokmat. Prior to that, the Network18 group had five listed entities—Network18, Television 18, IBN18, Infomedia18 and The Indian Film Company. TV18, Infomedia and TIFC got delisted as part of the restructuring plan and IBN18 was renamed TV18 Broadcast.
  • In 2012, Mukesh Ambani’s RIL bought debentures in Network18’s promoter group companies, convertible into shares at any time within 10 years, infusing much-needed cash into Network18.
  • In May 2014, Mukesh Ambani-controlled Reliance Industries Ltd board approved the funding of up to Rs 4,000 crore (Rs 40 billion) to Independent Media Trust (IMT), of which RIL is the sole beneficiary, for acquisition of control in Raghav Bahl’s Network18 Media & Investment Ltd, including subsidiary TV18 Broadcast.
  • Post Ambani’s acquisition, TV18 group saw senior-level exits. First to quit was CEO B Sai Kumar, followed by COO Ajay Chacko, CFO RDS Bawa, editor-in-chief Rajdeep Sardesai, wife Sagarika Ghosh, and finally Raghav Bahl and wife Ritu Kapur.

Network 18’s general news channel business was earlier headed by leading television journalist Rajdeep Sardesai, who left NDTV to join Bahl’s venture.

Rajdeep-Sardesai-400“The last decade has seen a lot of momentum in the Indian media industry and has been particularly exciting for us. During this time, we witnessed two media houses coming together to redefine the way news is presented to a demanding audience; we at TV18 have benefited from this relationship with CNN,” said Parigi.

Agreed Raad. “We are very proud to have created CNN IBN in our decade long partnership with TV18. The channel was a pioneering initiative that combined the best of CNN’s global expertise with TV18’s journalistic and newsgathering capabilities.”

Sardesai quit the company following TV18’s acquisition by Ambani-led Reliance Industries. Global Broadcast News (GBN), which had the original agreement with CNN Turner International, later became IBN18 Broadcast and then TV18 Broadcast Ltd.

CNN IBN was at number three spot with a weekly rating of 148 in thousands, as per BARC ratings for all India: NCCS AB: Males 22+: Week 24: Individuals: C&STV18 1Lac+.

TV18 also has a brand licensing agreement with CNBC to run business news channels. On 13 August 2003, TV18 entered into a program and trademark license agreement with CNBC-Asia Pacific.  As per this deal, TV18 can use CNBC’s name and logo for the production and broadcast of CNBC-TV18 until 31 March 2018.

TV18 operates a clutch of general, business and regional news channels like CNBC-TV18, CNBC Awaaz, CNBC Bajar, CNBC-TV18 Prime HD, CNN-IBN, IBN7, ETV channels and IBN-Lokmat, a Marathi regional news channel in partnership with the Lokmat Group.