If advertising dollars are shifting from regular media to technology giants, the trend will come to India too.
So, it is anybody’s guess how long Indian print media can keep growing profitably.
India’s print media, it would seem, is growing like gangbusters. In contrast to the doom and gloom in global print media, in the 10 years from 2006 and 2016, Indian print media grew by 4.87 per cent annually, growing circulation from 39.1 million to 62.8 million daily. The north, which is largely the Hindi belt, grew fastest, at an annual compounded growth rate of 7.83 per cent, according to Mint newspaper.
While Hindi newspapers grew at 8.76 per cent, Telugu came a close second at 8.28 per cent and Kannada at 6.40 per cent. English language newspapers were the slow coaches, growing just 2.87 per cent.
What this indicates is that the regional languages, and especially newspapers in the Hindi belt, are the real growth engines in Indian print media.
According to the Audit Bureau of Circulation (ABC), which put out these figures, this healthy growth trend is the result of several factors, including growing literacy, overall economic growth, direct access to newspapers at home, competitive pricing and the greater credibility of print compared to the online media.
This means the growth will continue for some time, but the relatively low growth in English language publications indicates that the peak may not be very far off.
What does not get mentioned, of course, is the large number of politically-affiliated publications, which have large circulations and are driven by funny money. The rise and fall of some newspapers (like Deccan Chronicle) is related to the fortunes of the politically-affiliated.
But are the factors responsible for Indian print industry’s growth sustainable?
India’s literacy rate, at 75 per cent, will continue to grow for a while. Economic growth too could sustain.
Political funding support to publications that don’t have their own viability will dry up as politicians find it tougher to generate black money in future.
Moreover, cheap pricing is a function of high advertising, and here the omens are not very good.
The Mint report quotes ABC as projecting print advertising revenues at Rs 29,600 crore by 2021, just a whisker over digital ad revenues of Rs 29,450 crore. TV gets Rs 39,410 crore.
More importantly, real advertising power is shifting away from traditional media to tech powerhouses like Google and Facebook, among others. This cannot be great news for print media.
According to Zenith, a media agency, Google and Facebook have been earning more than traditional media houses in terms of advertising revenues, with Google topping with $79.4 billion in 2016, followed by Facebook with $26.9 billion. At No 3 is Comcast, which owns traditional media outfits like NBC, with revenues of $12.9 billion. But at No 4 is Baidu, the Chinese Google, with $10.4 billion.
If advertising dollars are shifting from regular media to technology giants, the trend will come to India too. With digital media growing in leaps and bounds, advertising will shift to digital, and within digital to the technology giants who serve ads on various sites, including mobile sites.
Print will slow further once advertising becomes harder to get, and cover prices must be raised to cover for costs.
With smartphone penetration rising very fast due to falling handset prices and higher connection speeds (India had 220 million smartphone users in 2016), the switch to digital will reach inflexion point quickly over the next five years.
It is anybody’s guess how long Indian print media can keep growing profitably. But it would be foolhardly to believe that what happened abroad won’t happen here just because the last 10 years have been good.