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Zee Media plans English general news and business news channel

MUMBAI: After launching a slew of state-specific regional news channels, Zee Media Corporation is planning to enter the English-language news space. On the agenda is the launch of an English business news channel and an English general news channel.

Alok“Both (English general news and English business news channels) are on the anvil. We are looking at launching the channels by this fiscal or by next fiscal. We might launch one towards the end of this fiscal. I can’t give a definitive launch period at this point,” Zee Media Corporation CEO Alok Agrawal told TelevisionPost.com.

It must be noted that the news broadcaster has been planning to launch an English news channel and an English business news channel for quite some time now. The market dynamics, however, did not support the launch of these channels.

The English news channel has four major players including Times Now, NDTV, CNN-IBN and Headlines Today while the English business news space has CNBC TV18, ET Now, NDTV Profit and Bloomberg TV India. Zee Media already runs a Hindi news channel Zee Business that competes with CNBC Awaaz.

“We were waiting for the regulatory environment to settle. Now at least we have some clarity as far as regulations are concerned,” said Agrawal.

On the regulatory front, Agarwal said that the Telecom Regulatory Authority of India’s (TRAI) 12-minute ad cap was a big drag down for the news television industry.

“News channels are dependent on ad revenue for our sustenance. The TRAI’s ad cap will put a financial burden on us. In any case, news broadcasting is not a profitable business,” stated Agrawal.

The regulator, he said, was not willing to look at the dynamics of the TV news industry. “We had made representations to the TRAI explaining how the ad cap implementation would prove to be a death knell for us. The regulator, however, is in no mood to look at the dynamics of the industry,” Agrawal bemoaned.

While the ad cap came into force on 1 October 2013, the news channels are not following the regulation due to relief from the Delhi High Court that has prevented the sector regulator from taking any coercive action against them.

According to a research done by TelevisionPost.com, Hindi news channels are consuming ads in upwards of 20 minutes per hour during prime time (7–11 pm). In case the Delhi HC rules in favour of the TRAI in the ad cap case, the Hindi news channels will have to cut commercial airtime by 40–50 per cent.

Agrawal dreads that scenario as increasing ad rates in the current environment will be a tough task by any yardstick. “The placement fees for news channels have not come down drastically and the subscription money has not started flowing in adequately. Despite that, the regulator has implemented ad cap. Our content cost will go up while our ad inventory will fall.”

Agrawal also agreed that it is impossible for Hindi news channels to offset the ad inventory loss by hiking ad rates. “At best, we can get a 20 per cent rate hike but that will not be able to compensate for our inventory loss. We can expect 10-15 per cent growth from non-FCT revenue. So we will decide on the way forward once the court takes a call,” he averred.