The economics behind the news anchor’s ‘performance’ on TV

In India, the licence granted to a media house for use of sovereign airwaves is granted by the Government of India for a public purpose — to inform, hold a mirror to society, and to hold to account institutions — for the common good.

Sadly, the breach of this is the widespread reality. The country was silent when Tamil Nadu had and continues to have television news channels owned by the same people who run its politics, with not even a fig leaf of pretence. This silence in one state enabled the phenomenon to permeate to other states and then to national news. This heightened to a crescendo with the BJP coming to power in 2014, of course with the fig leaf of arms-length ownership.

It is easy to drive viewership, and therefore revenues, by ‘performing’ before the camera. The return on investment (ROI) earned is staggering. The direct cost of a byte-sized news story at breaking time is roughly just Rs 28,000 (source: mynewsdesk), but the returns are huge if it catches viewer-attention.

Recently, a national channel carried ‘breaking news’ that vaccine vials were found in a dustbin in Rajasthan. The newsroom editor decided to spin the story, devoid of details, looping amateur footage, and called it ‘Covid Sabotage’. This less than-Rs 50,000 story enjoyed 30 minutes of Prime Time, and if it had caught on, the returns would have been 5,000 times – government ads, other ads and then the ingratiation enjoyed by both sides playing this game.

In an article published in March 2014, ahead of the Lok Sabha elections, Business Standard estimated that Rs 2,500 crore was the “official” spend by the BJP and Congress on print and TV advertising. Contrast this to the BJP’s audited accounts for FY2010-11, which presumably reflects spends on the 2009 Lok Sabha campaign— a modest Rs 34 crore!

In the Uttar Pradesh Assembly elections in 2017, over Rs 5,500 crore was spent on campaigns by various parties, with 70% of this spent by the BJP (CMS pre-post poll study). Even today, it is estimated that up to Rs 50 crore is spent on advertisements every day to manage perception of the Yogi Adityanath government.

Money for nothing

According to Untamedscience, a National Geographic feature of one hour costs the channel Rs 2.9 crore, and the cost of a single episode on BBC’s Planet Earth is estimated to be Rs 14 crore. A well-researched investigative report in India could cost upwards of Rs 10 lakh.

One of the best documentaries on Kashmir was made by Times Now in November 2019, tracing Kashmir’s history from the Gupta Empire to its current day impasse and the revocation of Article 370 over its two-hour length. Based on the budget drawn up by Swastika Films (see Table), for 30 minutes, the documentary could have cost upwards of Rs 30 lakh. We have, expectedly, never seen anything like that since!

A Washington Post editor, J Lynn, is quoted as saying that an ideal combination of sources that go to make a credible story is 25% sources, 25% on-the-ground investigation, 30% research, 10% from public or owned databases, 2% from social media, and the rest from others.

The point is, if a news editor wants his/her hands muddied in a story, then 80% of time and money is going to be spent on investigation.

Contrast this to the Sushant Singh Rajput suicide spin, which could have nearly altered political fortunes and electoral outcomes. Comprising studio guests, political spokespersons, a cameraman, and some paparazzi-type ‘journos’, this ‘breaking news’ would have cost a few lakhs, but yielded crores in returns in terms of advertising revenues, and the gratefulness of the government as an add-on.

It is easier to justify zero investment in the field, and zero time and money spent on investigation or research. It is also quicker.

Things Must Change

Social benefits outweigh costs, even if it does not yield positive returns for the media company. But then, this must be encouraged with policies for licences— grants and renewals.

First, ownership of the media house cannot be the same as ownership of the waves, which is public property. Make that difficult. Conflict of trust of public funds ensures that Diversified Corporate Houses cannot own a bank.

The same principle should be applied to media, which holds another kind of public trust. Politicians and industrialists must be barred from owning media. But, instead, as examples, Reliance controls directly or indirectly Network 18 (CNN News18) and some other channels, and politicians own Sun, Kalaignar, Jaya, Odisha TV, Jana TV, etc. Second, separate ownership and editorial control, with independence of the editorial desk vested with the board. The audit committee of a listed company reports to the board and not the owner. To protect shareholders, SEBI and Registrar of Companies ensure financial propriety. So, why not a similar mechanism here?

Third, it is time to build deterrence to this lucrative business of news-spin, with laws that tug at the purse strings. Here are two suggestions: One, investments must be shown and maintained on original and researched production (investigations, open stories and documentaries), outsourced or inhouse, as a percentage of revenues, of staff and salaries year after year. It stands to logic, and hope, that drivel cannot be the preserve of so many in the organisation.

Two, build in punitive measures for baseless sensationalism, regulated by a constitutional authority (like CVC or CEC), independent from the government. Since it is an umpire, the argument that journalists will not be free will not hold. India stands 142 in the press freedom index out of 179 countries (French NGO RSF 2021). It is not free anyway!

(The writer is a former managing director of a Tata Company and now runs a corporate finance practice headquartered in Bengaluru)