The Indianization of Indian Television

by: John Sinclair / University of Melbourne

It is now almost a decade and a half since international satellite services were first seen via cable to the home in India, inaugurating an era of the profusion of private channels in a society that had previously only known a government-controlled national broadcasting network, Doordarshan.

The old Doordarshan (‘DD’) was notorious for its worthy but dull programming, and for being very much an instrument of the government of the day. It was also very conservative of traditional values, especially where sexuality and bodily display were concerned – not even a kiss could be seen on screen.

In such a climate, small-scale cable operators found there was a ready demand for international satellite services, notably CNN with the onset of the first Gulf War, then the entertainment channels STAR TV in 1991, and especially, the Indian channel Zee TV in 1992. While the advent of The Bold and the Beautiful and Baywatch on STAR provoked a public debate about ‘cultural invasion’, the greatest impact of the subsequent opening up of the television market has been to stimulate the growth of Indian channels, in which Zee has been the leading light. Zee TV is the most popular of the Indian-owned cable services. It is vertically integrated with Zee Telefilms, which produces programs for the Zee television channels. Zee also has a cable distribution arm, Siticable, which is India’s largest MSO. At the international level, Zee has developed services for diasporic Indian communities in the UK, US, Africa, and the Pacific. Within India, as well as an education channel, Channel ZED, and four music and film channels in Hindi, there are channels in other South Asian languages (Bengali, Urdu, Gujarati, Telugu, and Punjabi), and also English.

Rise of the region

In fact, one of the most unexpected effects of the liberalization of television in India is how it has contributed to the rapid growth of channels in languages other than Hindi. Although sometimes referred to as ‘minority’ languages in comparison to India’s 337 million Hindi speakers, or ‘regional’ or ‘local’ rather than ‘national’ languages, several of them have tens of millions of speakers, such as Bengali with almost 70 million, or Tamil with 53 million. Significantly, most of the services are available not just in the region where each of the languages is spoken, but on a national, and sometimes (as with Zee and DD-India) an international basis. They are thus able to serve the diasporic populations inhabiting the geolinguistic regions they cover on a global basis.

Of the satellite-to-cable (‘C&S’) channels transmitting in the regional languages, Sun TV has been at the forefront with its service in Tamil, one of the distinct languages and cultures of southern India. Instigated by a Chennai-based family with close links to the former ruling party of Tamil Nadu State, SunTV is now one of a diversified network of channels in the languages of the south. There is also Asianet, the Malayalam service out of the state of Kerala, and Eenadu, broadcasting at first in the native Telegu language of the neighbouring state of Karnataka, and more recently in a whole range of regional languages. STAR TV has also staked out an interest in southern Indian television with its acquisition last year of Vijay Television, which produces programs for a Tamil channel of that name.

Bollywood repels ‘cultural invasion’

Fifteen years after the debate began, the cultural invasion has been attenuated, for in spite of its commercial, global gloss, Indian television is unmistakeably ‘Indian’. Most strikingly, the staple popular genre on television is the Indian film, with its characteristic music and dance. As well, some of the most popular panel and game shows are based on film music. This has meant that the proliferation of channels has also been a stimulus for the Indian film industry – not just ‘Bollywood’, the Mumbai-based Hindi industry, now so well-known in the West, but also those in some regional languages, especially Tamil. To that extent, film retains its historical pre-eminence as the powerhouse of mass-mediated popular culture, both in India, and for Indians abroad.

However, the Indian-ness of Indian television is not an eternal essence, but a contingent and contested social construction of a public culture between the local and the global, a process which Salman Rushdie called ‘chutneyfication’. Two trends are worth noting – the growing hybridization of media languages, and the popularity of channel and programming formats which have been indigenized from foreign models. Several writers have pointed to the emergence of a peculiar fusion of Hindi with English words: ‘Hinglish’. This is a media language drawn from the everyday language of the urban middle classes and of the diaspora. There is a corresponding trend towards ‘Tinglish’ in Tamil broadcasting, and possibly in the other regional languages.

In terms of channel formats, MTV is an illustrative case. Itself a global channel in multilocal formats, there are ten variants of MTV in Asia, mostly on a nation-specific basis, including MTV India. India also sustains successful indigenized versions of its own, notably Zee’s Music Asia channel and STAR’s Channel [V]. As for program formats, the most remarkable success of recent years has been Kuan Benega Crorepati (KBC) on the STAR Plus channel, based on the legally acquired format of Who Wants to Be a Millionaire. Part of its indigenization was its connection to Indian film, in that the host was one of the nation’s most popular ever film actors, Amitabh Bachchan, a kind of Indian Sean Connery.

Commercially, KBC was a milestone success for STAR Plus, which earns nearly 40% of STAR’s revenue in India, but which only turned a profit for the first time in 1999, following KBC’s triumph. STAR Plus subsequently moved from bilingual (English and Hindi) to all-Hindi programming in an effort to catch up with Zee and Sony. By 2002, STAR reported that it had become more profitable than Zee, and it has greatly strengthened its competitive position against Zee since.

DD dominates

However, it’s important to understand that for all the changes brought by C&S to the new television landscape in India, DD remains the dominant broadcaster over all. DD is still the only terrestrial broadcaster, and until recently, enjoyed government protection under a regulation which gave it the exclusive right to uplink its satellite signal from Indian soil. As well, DD is guaranteed wide distribution over C&S under regulatory provisions which mandate that all cable operators ‘must carry’ three DD channels.

The most decisive factor for the continued development of the relatively mass market for cable television is advertising revenue, which is much more significant for the C&S industry than are subscription fees. Advertising now constitutes 70% of C&S industry income. Even with the profusion of channels, the revenue pool has increased, given continued growth in the number of C&S homes, as well as a much more commercial ethos now established for television within the general context of the liberalization of the economy as a whole. According to a trade source, from around 15% in the last days of DD’s monopoly, television now absorbs 41% of the estimated total advertising expenditure in India. However, although DD’s share of advertising revenue has been in a long decline, this is happening more slowly than its competitors would want, and it still gathers the majority of revenue. Thus, the abundance of channels available is deceptive, since DD, along with Zee, STAR, Sony and Sun, account for about 90% of television advertising revenue between them, making it difficult for the minor players to become viable.

So, the opening up of televisual culture in India over the last fifteen years has not brought about the overrunning of local cultures implied by the rhetoric of ‘cultural invasion’. On the contrary, it has permitted growth in the regional language channels, and competition for audiences has clearly been won by those channels which have developed programs based on Indian popular culture, particularly film and film music, and which have been able to convincingly indigenize the global formats of commercial television channels and programming. The question is no longer one of local versus global, but just how they are made to work together to produce new forms of commercial culture.

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Global Advertising Data SOX-ed up

by: John Sinclair / Victoria University, Melbourne

Those of us with an orientation towards political economy and an interest in how the advertising industry propels media development have lost a lot of wind from our sails with the Sarbanes-Oxley Act that was passed by U.S. Congress in July, 2002. The purpose of the Act is to protect investors from financial scams in the wake of Enron, Worldcom and other scandals, by considerably tightening the rules regarding the disclosure and verification of financial information (and especially claims of revenues or profitability) by publicly-listed companies.

In particular, the Act requires the CEO and CFO of such companies to prepare a statement accompanying their audit report to certify the ‘appropriateness of the financial statements and disclosures contained in the periodic report, and that those financial statements and disclosures fairly present, in all material respects, the operations and financial condition of the issuer’. In other words, the company’s principal executives personally have to verify declared figures.

The implications this has had for the advertising industry is that it has put an end to the various annual rankings which, until Sarbanes-Oxley, or ‘SOX’ as it has been dubbed, would be published by trade journals and professional bodies, not just in the US, but internationally. In the US, the annual league tables would be compiled and made widely available, most notably in Advertising Age; in Australia, it was done by AdNews and B&T Weekly; in the UK, income tables were produced by the Institute of Practitioners in Advertising (IPA); and in Europe, by the Research Reports on Agency Media Networks service (RECMA).

For once, critical political economists and large corporate advertisers have found an interest in common that has been affected by the new law, as neither group has a comprehensive league table of advertising agencies’ annual performance any more. Not that anyone in the past took the rankings as an accurate measure. Advertising agency income is made up of ‘billings’, the amount of their clients’ money that agencies spend on buying advertising time and space in the media, as well as fee-for-service activities. Billings figures always were rubbery, because they would necessarily include estimates from shared accounts and from subsidiaries, as well as income earned but not yet secured. Therefore they could easily be inflated to give the impression an agency was doing better than it actually was. So, they always had to be taken with a grain of salt anyhow.

However, since SOX, agency principals do not dare to put their name to a dubious set of figures, and some CEOs even seem to be relieved to be able to shelter behind the new law, after having risked exposure for so many years. As one senior advertising executive in Australia commented, ‘Once upon a time, the release of the rankings was the great event of the year. It was quite good sport and everyone treated it with the humour it deserved. It’s a shame it got abused’.

OK, so the game’s over. But how is it that the effects of a US Act of Congress are being felt in Australia, the UK, Europe and elsewhere? Because of the globalization of the advertising industry, and the integration of US-based agencies within the largest agencies of all the major nations that have a commercial mass media system. Although some US agencies had already opened up offices outside of the US before World War II, the 1960s saw a wave of expansion into Europe, Australia and other former British dominions, and also the newly independent developing nations. The agencies were following the prior expansion of their clients to a large extent, the new ‘transnational corporations’, but also the dynamics of an emergent international manufacturing–marketing–media complex. They had enjoyed growth in the US, thanks to the first decade of television, and this gave them expertise (‘American know-how’ is a phrase of the era) that was advantageous in other national markets where television was more recently introduced. The bulk of the Australian advertising business was taken over in the 1960s by US agencies, that either set up their own subsidiaries or entered into various arrangements with Australian agencies.

Thus began the present era, in which the largest advertisers, mainly transnational, or more accurately now, global corporations, do their business with the largest agencies, and television takes an ever greater share of revenue. The largest agencies are also global, though US ownership and control has been greatly attenuated, not just in Australia but in comparable markets, by significant participation from UK, French, and to a lesser extent now, Japanese agencies.

One crucially important global trend of recent decades has been that in which several large international agencies — transnational corporations in their own right — form what the trade press calls ‘supergroups’ or ‘megagroups’. These groups do not operate as unified advertising agencies, but as holding companies which have a management and financial coordination function at a stratospheric level around the planet: this integrates the activities of the group’s member companies in marketing communications (such as market research and public relations) with the advertising agencies and their clients on a global basis.

A notable case is the British group WPP, which in the last decade has acquired agencies that had long been identified with the US, notably Young & Rubicam and J. Walter Thompson. Similarly, the French-based Publicis Groupe has Leo Burnett from the US as well as one-time British star agency Saatchi & Saatchi in its stable. The largest three agencies in Australia are all Australian-controlled, but they all have some minority ownership from the US or UK, so they cannot be said to be Australian-owned. The point is not so much that US capital is being replaced by British and French in the advertising industry, but rather, as in most truly global industries, the nation of origin is becoming irrelevant.

The passage of SOX will make global trends so much harder to track. As well as the WPP and Publicis agencies mentioned above, other major agencies in Australia which no longer cooperate with the trade journals’ annual rankings include Grey Global Group and those in the US-based Omnicom Group (e.g. DDB) and Interpublic Group (McCann-Erickson). So, while SOX might give protection to US investors, this has been achieved at the expense of the public interest on a global scale.

Links:
Guide to the Sarbanes-Oxley Act
Latest on trial of former Worldcom chief executive Bernie Ebbers
The Sarbanes-Oxley compliance kit

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News Corporation: From the Local to the Global

by: John Sinclair / Victoria University, Melbourne

At the end of last month, October 2004, Rupert Murdoch won shareholder approval to move News Corporation’s domicile and main stock market listing from Australia to the US. Subsequently cleared by the relevant Australian and US authorities, it has become incorporated in Delaware as News Corp US, with its primary listing on the New York stock exchange, and it expects to join the S&P 500 index next year. While the shift brings News into line with the reality that it now generates 75% of its revenue in the US, it was aimed also at gaining better access to Wall Street capital markets and getting closer to institutional fund investors in the US.

With friends like that, who needs enemies?

However, even before the NYSE listing occurred, while many formerly Australian-held shares were in play during the crossover, a large parcel was snatched up by Merrill Lynch, acting on behalf of John Malone, formerly principal of Tele-Communications Inc., and now Liberty Media. Malone had been building up his stake in News for some time, and before the shift already was the second biggest owner of voting stock, with 9.2 per cent. With the latest purchase, he now has 17.3 per cent, which compares to Murdoch’s 29.5 per cent. Malone’s position could strengthen further as he also owns convertible non-voting shares. It is not clear whether his bid is friendly or hostile, or something else again. The financial press is full of speculation. Is Malone actually after control of News, perhaps to merge it with Liberty Media? Or is he just putting pressure on Murdoch to reciprocate by taking up equity in Liberty? Perhaps Malone is not necessarily after control in his own right, but making sure he is in a position to influence who succeeds Murdoch?

Certainly, Murdoch has already shown that he knows how to take care of himself in the bear-pit of the NYSE, but the next few months to April, when Malone has to settle with Merrill Lynch and News becomes listed on the S&P 500, will be a decisive phase for the future direction and control of News.

‘I still call Australia home’

With the last annual shareholders’ meeting at the Adelaide Hilton on October 26, it seems that News Corporation ceased to be an ‘Australian’ company, so as to become an ‘American’ one. It is easy to conclude that there must be some centripetal pull in capitalism, though a harder look at the dynamics shows that, quite apart from the fact that capitalism has more than one centre, decisions like this are motivated by a strategic assessment of comparative advantages. In this case, and regardless of what risks it was taking vis-a-vis Malone, calculated or not, News relocated to be in its largest and most profitable market, and to be closer to sources of capital.

However, this ‘historic’ shift, as Murdoch called it, gives us cause to reflect more deeply on the relationship which global media companies now bear to the nation-states in which they develop, and in which they are domiciled – which is obviously no longer the same thing.

When Rupert Murdoch’s father died, he left him nothing but a newspaper – not a copy of a newspaper, of course, but the whole business, namely the Adelaide News. It was from this asset that the young, Melbourne-born Rupert Murdoch went on to build up media interests progressively in Australia, then the UK, the US, Asia and Latin America, ultimately forming today’s eponymous global media conglomerate.

Rupert Murdoch’s father had been Sir Keith Murdoch, who began his career as a journalist, but became a major figure in the development of the commercial popular press in Australia between the World Wars. Seen as the counterpart to the innovative and interventionist British press baron Lord Northcliffe, Murdoch Senior earned himself the epithet, ‘Lord Southcliffe’. Yet Keith Murdoch’s international outlook went beyond the customary colonial fealty to Britain, which Australians of his generation referred to as ‘Home’: interestingly, he was a founder of the Australian-American Association, created before World War Two to foster ties with the US.

As far as Rupert himself is concerned, he quite famously became an American citizen in 1985, so as to purchase the group of Metromedia television stations in the US which he intended to build into the Fox network. This also was a strategic move, required to comply with FCC restrictions on foreign ownership of US television stations. The subsequent taunts of ‘Citizen Murdoch’ refer to this change of allegiance: not his mythic stature as an aloof and omnipotent Citizen Kane figure.

Although personally an unabashed admirer of the US, and now notorious for the conservative editorial slant of his media properties in the US, Murdoch’s change of citizenship appears to have been utterly pragmatic – just something he had to do to acquire Metromedia. Like News’s shift to the US, it demonstrates the arbitrariness, and many would say, cynicism, with which global media companies now relate to the nation-state, and calls into question the very point of maintaining foreign ownership rules at all, at least within what the conservatives are now calling ‘the Anglosphere’.

News had long since ceased to be ‘Australian’ in any meaningful sense before the shift to the US, although it commands nearly 70% of the daily press, operates Fox Studios, and is a major player in pay-TV and recording in Australia. It will continue to list on the Australian stock exchange, as a secondary listing, and has pledged to maintain and expand its operations in Australia. Ironically, just as in the US, Australia has a newly re-elected conservative government, one that is now in a position to lift the foreign ownership restrictions which it hitherto had been thwarted in doing. This would allow News to acquire a broadcast television network ,but at least for the moment, Murdoch is feigning a total lack of interest in that prospect.

Adelaide, the cradle of News Corporation and home to it for fifty years, with little more than a million people, is one of Australia’s smaller state capitals. Although it has a stylish and cosmopolitan side to it, Adelaide is mostly sedate and a little provincial, in an English kind of way: ‘a city of pubs and churches’. It was not surprising that Murdoch’s ambitions soon outgrew it, but he maintains that it will always have special place in his heart – wherever that is.

Links
News Corp home page
AP report on News Corp’s move to US
Economist editorial on Rupert Murdoch

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