Business Standard

Vanita Kohli-Khandekar: When politicians own the media

A cursory analysis of news channels shows that roughly one-third are just political vehicles or peddle influence for builders

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Last month the ministry of information and broadcasting decided to extend the June 30 deadline to digitise TV homes in the four metros. The new deadline is October 31. There are various reasons for the delay (“is not a good sign”, June 22). The biggest, however, is cable TV ownership. In many states, who own cable networks do not like the idea of subjecting their fiefdoms to the scrutiny that digitisation would eventually force. Most had been pushing for an extension.

This, however, is not about digitisation. It is about the politicisation of media ownership and how it is changing the fabric of the Rs 80,000-crore Indian media and entertainment business.

More than a third of news channels are owned by politicians or politico-affiliated builders. An estimated 60 per cent of cable distribution systems are owned by local politicians. These have influenced and funded several local elections. There are dozens of small and big newspapers owned by politicians or their family members that influence the course of several local elections. Many newspaper chains with political affiliations also own broadcast networks. Most now have Internet portals.

Much of this, then, begs the question: shouldn’t we be discussing the political ownership of the media and its impact on the nature, quality and course of debate in the country? What harm does this ownership do to the long-term fabric of this business? Will it make it unviable in the long run? Will it put off legitimate Indian and foreign investors because policy could be changed to accommodate this class of owners?

The television news business is a good case in point. Going by figures, there are 133 news channels in India, the highest in the world. They are fighting over a stagnant Rs 1,800-crore to Rs 2,000-crore ad pie. Of the four listed TV news companies, only one – TV Today – made post-tax profits in March 2012. Most of the unlisted ones are barely recovering their operating costs. Yet many more news channels await permission to launch.

A cursory analysis of news channels shows that roughly one-third are owned by companies or individuals not interested in building a news brand. Many are just political vehicles; others peddle influence for builders. As a result, the companies that want to make money by running a good old-fashioned news outfit end up competing with ones that have no shareholders or investors to answer to. So they can burn as much cash as they want. One consultant recounts that a news channel in Andhra Pradesh was advised that the optimum number of OB (outside broadcasting) vans for a channel in that genre was four; it insisted on having 30 OB vans simply because it had no need to control costs or make a profit. The result is: declining standards and unhealthy competition as channels vie with each other for every scrap of news.

Take a look at cable TV. Digitisation will force transparency, plug revenue leakages to the tune of Rs 10,000-odd crore and bring in more taxes. Little wonder, then, that no cable operator wants it. In the normal course of things, any government would have pushed it through simply because it makes so much sense. But given the ownership pattern of cable TV, this has proved difficult for most governments. No one wants to risk a blackout and a consumer backlash.

There are several such examples of media ownership by politicians proving to be harmful — not just because of the influence factor, but also because of their dodgy business logic.

How can this be tackled? Largely, governments are too afraid to touch the media (the paid news scandal in newspapers) or love to meddle with it (content). Either way, its intervention does not come from a neutral, big-picture perspective. The exceptions to this are the radio policy and digitisation law — both are forward-looking and robust. But usually a ministry will always be subject to the pulls and pressures of coalition partners, party members and other individuals.

The answer, then, seems to be an independent-of-the-government media regulator a la the UK’s Ofcom or America’s Federal Communications Commission. If a regulator is truly independent – like the Securities and Exchange Board of India or the Insurance Regulatory and Development Authority – it is stronger. It is backed by an act of Parliament and its decisions are usually harder to challenge, which creates more stability. For instance, the Telecom Regulatory Authority of India’s coming in as broadcast regulator actually helped clean up a lot of the on-ground mess in cable TV.

This media regulator could then decide on a policy vis-a-vis ownership and the dozens of other issues that the industry faces. The question is: which government will show the “political” will to outsource media regulation?


 

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