Posts Tagged ‘metros’
The Government of India (GOI) has passed a mandate that all cable services in the four metros be digitized by 30th June, 2012. From 30th June, the four metro cities will cease to receive analogue television broadcast signals. The target for complete digitization in urban areas is September 31, 2014 while the entire country is expected to achieve digitization by December 31, 2014.
Currently, the cable operators transmit the channels in analog signal mode which is very hazy. In a digital signal, the receptivity is much clearer and all the channels have the same reception quality. As both the signals are received at the same time, there are no issues with the synchronization of sound with video. There is a huge cost involved in digitization of cable signals and many cable operators are shying away from this kind of investment, barring few organized and large scale cable operators.
Meeting the deadline is very difficult
Following government directives broadcasters will relay only encrypted digital signals that will then be accessible to customers with set top boxes (STBs). However, meeting this deadline is just impossible. This deadline implies installing over 1.5 lakh STBs per day in the four metros. Currently, the number of daily installations in the four metros together is only 10,000.
Benefits to Viewers
Unlike the earlier scenario, wherein subscribers were forced to choose whole packages of channels even if they did not watch them all, in the new regime, they will be allowed to choose channels on a la carte basis. In other words subscribers will have much better choice at picking only the channels that they want. This will surely bring in price regulation for both the Direct To Home (DTH) & digital cable operators. Also, the Cable TV networks are now free to recover digitization costs from broadcasters through ‘Carriage Fees’. Earlier they were charging the consumers for it. Carriage fees borne by broadcasters are estimated to be around Rs. 4,000 Crores (US$ 752 Million) annually.
Impact on Viewership Ratings
One of the expected benefits of digitization is much better transparency on viewership. This is one of the reasons why the legislation involved has been so contentious. Many channels are highly creative with their viewership numbers. Most like to retain that freedom to stay fuzzy. With digitization, data on media content consumption is much more concrete.
Globally, in most countries, TV channels earn 70% of its revenue from its subscription and only 30% from advertising. In India, the revenue split is exactly the reverse, with 70% of the channel revenues coming from advertising. Digitization is expected to bring down carriage fees and reduce dependence on television rating points. TV Channels fighting for high TRPs to woo the advertisers will see a decline, with reduced dependence of revenues from advertisers. With HDTV providing more control to viewers to filter the content (esp. advertisements), there is a fear that viewers may chose to cut advertisements for an additional subscription fees.
This is a double edged sword. On the one hand, digital broadcasting can help launch high-quality niche channels that cater to a specific, paying customer base. The lack of Indian equivalents of the UK’s BBC and America’s Public Service Broadcasting Service, with their formidable non-fiction programming is frequently lamented.
Friction-free access to new channels can remedy this and chances are that as the medium evolves in the years ahead, the paucity of quality programming may turn out to be a matter of the past. But,on the other hand, this can end up as a new war for eyeballs. And that will lead to the same approach to content that plagues our print media: where readers often pay little to nothing to be fed dubious content. This move is supposed to democratically benefit all stakeholders in the value chain. Only time will tell: Will it benefit all equally or Will it lead to new power-players?
The heterogeneity that characterizes the modern Indian consumer has created a maze that marketeers would like to unravel inorder to target their products and services precisely. In this blog, we see the analytics presented by Indicus Analytics on the various facets of urban consumers, across geographies and socio-economic groups.
Despite visible growth in rural markets, it is in the teeming urban centres that most of the action takes place. Indian cities vary not only in size but also in terms of its economic activity. There are the bustling metropolises, towns dominated by manufacturing(Coimbatore – Tiruppur), towns that are basically transport hubs(Itarsi) and mining towns(Dhanbad). And then there are numerous small towns, most of which have no special characteristics and are overgrown villages whose markets attract people from the countryside now.
Urban centres can be classified into seven distinct sets:
- Metros with large populations – Mumbai, Delhi, Bangalore, Chennai and Kolkata – are, of course, a marketeer’s delight. They all have a good mix of people, the affluent, the middle class and the poor. Moreover, it is not that Mumbai and Bangalore have that cosmopolitan mix of people; even Chennai is shaking off its staid conservative image.
- Mini-metros are again five in number. These cities are growing so fast that they are straining at their edges to make it to the big league soon – Hyderabad, Ahmedabad, Pune, Coimbatore, and Chandigarh. On an average, mini-metros have a higher share of rich households than metros, a reflection of the smaller size and the higher density of professionals and skilled migrants.
- Tier 1 towns, with populations of more than 1 million, 33 in number, include most state capitals and cities such as Allahabad, Jodhpur,Visakhapatnam, etc.
- Tier 2 towns have populations between 6lakhs and 1 million. There are 28 in all, including upcoming cities such as Raipur, Ranchi, Bhubaneswar, Thiruvanthapuram, etc.
- Tier 3 towns, with populations between 2 lakhs and 6 lakhs are 152 in number and include Vellore, Sonepat, Siliguri, Shimoga, Agartala, Aizawal, etc.
- Tier 4 towns are the smallest with populations between 1 lakh and 2 lakhs. This category has 201, including Shimla, Ambala, Dibrugarh, Wardha, etc.
- Add to these the peri-urban centres, 4600 in number, with populations less than 1 lakh, that surround big cities or lie on highways across the country, and we get a fairly good picture of the diversity in India’s urban markets.
For those looking to tap the most affluent, metros are of course the richest and are the largest consumer markets – these five cities have a per capita income of 92000 rupees per year, compared with the lowest rung of peri-urban centres, whose per capita income is 52000 rupees per year. Interestingly, while Mumbai has the largest share of richest households earning more than 10 lakhs per year, it is Delhi with is middle class, public sector image that has the highest number of such households. Among the mini-metros, Pune, Ahmedabad, Hyderabad, Chandigarh, and Coimbatore rank in that order for the highest number of affluent households.
What is most notable about India’s urban centres is that they are spread out all over the country and not just clustered in some zones. Gujarat is the leading state when it comes to rich households in tier-1 cities with Surat and Vadodara the hotspots here, while Kerala has the highest concentration of rich households among tier-2 cities. Thiruvanathapuram and Kochi rank among the top five here.
If we look at smaller cities, Noida, Gurgaon, Mangalore, Kolhapur have the highest number of affluent households among tier-3 cities, while in the smallest towns, it is West Bengal and Haryana that stand out for rich households among tier-4 towns – Bidhan Nagar, Panchkula, Haldia, and Thanesar.