Investment Principles of Media Management and Their Significance Investment

Media Management
Masters. Semester IV
Principles of Media
Management and their
Significance.
Technological
Infrastructure and Investment
Investment
Media Investment
You think we are going to calculate the amount of investment

required for a media business.
However it is difficult to calculate investment in media as

there are numerous parameters
Nature of publication
Periodicity
Geographical spread
Place of publication
Media Investment : Challenges
It is clear that business owners encounter various challenges

with respect to investing in media.
Among the challenges they face include

lack of time,
lack of knowledge on
how to determine the return on investment(ROI), and absence
of media operational skills.
Nevertheless, determining the media ROI remains as the

fundamental problem to most business owners.
Return on Investment . ROI
In addressing this challenge, we should first define ROI.
ROI is the most common profitability ratio that establishes the

efficiency of an investment.
In this context, ROI will measure the returns from a media investment.
However, it is factual that calculating ROI is difficult, may not be

perfect, and depends on the applied returns and costs.
Actually, there is no universal way of measuring the ROI of the social

media commitments (Kelly, 2012).
Readership Profile : ROI
As such, business owners tend to count how many copies they sell.
However, this may not be an effective measure of ROI.
We can measure ROI using metric tools that foster conversion

measurement and optimized CPM, which enables ads to reach the
target audience (Burg, 2013).
This enables the investor to know the profile of their ads thus
enhancing future business planning.
In addition, we can measure ROI by analyzing readership profile by

multiplying the number of times each copy is read .
Readership Profile : ROI
This defines how far the advert went.
Moreover, we can analyze traffic to determine the ROI in media

(Harden & Heyman, 2011).
Indeed, business owners need to evaluate their ROI in media and thus
there Readership Survey analytics tools for following engagement, per
copy readership and number of times(Burg, 2013).
This helps the marketers to determine how often people find the
advertisement. For example, for The Telegraph, one can analyze the
readership to particular pages, one can analyze the re view of pages
Notably, the higher the ratios, the higher the ROI .
Media Investment Parameter
There are several ways to invest in media, depending on
the financial returns you seek
the term of your investment and
where you are in the world.

Investment : Return and Time
Investors choose their interest rate (up to 15%) and
the term of investment (from 1 to 10 years)
the lower the interest rate and the longer the term, the
more it helps
There is no limit on the amount that can be invested, while

investments start at Rs 100 Crores
Venture Capitalists
The venture capitalists who are willing to back media

organizations are looking for the right kinds of companies,
some of which are similarly appealing to investors but
distance themselves from one another.
For instance, the investment of Kothak Mahendra in Business

Standard . Kotak Mahindra Group invested in Business
Standard in 1996. Business Standard is published from seven
centres in India - Mumbai, New Delhi, Kolkata, Bangalore,
Chennai, Ahmedabad and Hyderabad. The Financial Times of
London has taken an equity stake in BSL.
What is Venture Capitalist Looking At ?
The industry has been largely driven by increasing

digitisation and higher internet usage over the last
decade.
Internet has almost become a mainstream media

for most of the people.
Why Venture Capitalist and FDI?
The Indian advertising industry is projected to be

the second fastest growing advertising market in
Asia after China.
At present, advertising revenue accounts for around

0.38 per cent of India’s gross domestic product.
Market Dynamics
Indian media industry grew at a CAGR
(Compound Annual Growth Rate) of 10.90 per
cent from FY17-18; and is expected to grow at a
CAGR of 13.10 per cent to touch Rs 2,660.20
billion (US$ 39.68 billion) by FY23 from Rs
1,436.00 billion (US$ 22.28 billion) in FY18.
Market Dynamics
India's media consumption has grown at a CAGR

(Compound Annual Growth Rate) of 9 per cent
during 2012-18, almost nine times that of US and
two times that of China.
The industry provides employment to 3.5-4 million

people, including both direct and indirect
employment as of 2017.
Foreign Direct Investment in Media
14 Mar 2016: Govt. increases FDI limit in News

channels and FM radio to 49%, up from the
existing cap of 26%.
January 12, 2018: The government considers a
proposal to increase foreign direct investment
(FDI) limit in Print Media sector to 49 per cent
from 26 per cent at present.
28 Aug 2019: Govt. allows 26% in Digital Media.
The Foreign Direct Investment (FDI) in Indian
Market
The Foreign Direct Investment (FDI) inflows in the
Information and Broadcasting (I&B) sector (including
Print Media) in the period April 2000 – March 2019
stood at US$ 8.38 billion, as per data released by
Department for Promotion of Industry and Internal
Trade (DPIIT).
The Foreign Direct Investment (FDI) in Indian
Market
As of September 2018, Companies announced video

content collaboration with 12 Indian partners for video
highlights and live streaming of sports, entertainment
and news.
5 private equity investments deals were recorded of

worth US$ 115 million.
Source of Revenue for Print, Electronic
and Digital
The Indian digital advertising industry is expected
to grow at a Compound Annual Growth Rate
(CAGR) of 32 per cent to reach Rs 18,986 crore
(US$ 2.93 billion) by 2020, backed by affordable
data and rising smartphone penetration.
Government Initiatives for Foreign Direct
Investment (FDI) in Indian Market
The Telecom Regulatory Authority of India (TRAI)

is set to approach the Ministry of Information and
Broadcasting, Government of India, with a request
to fastrack the recommendations on broadcasting,
in an attempt to boost reforms in the broadcasting
sector.
Government Initiatives for Foreign Direct
Investment (FDI) in Indian Market
The Government of India has agreed to set up the

National Centre of Excellence for Media.
The Indian and Canadian Government have signed

an audio visual co-production deal to enable
producers from both the countries exchange and
explore.
Government Initiatives
The Government of India has supported Media
Industry’s growth by taking various initiatives such as
digitising the cable distribution sector to attract
greater institutional funding.
New Challenges. Strategy to Boost
Advertisements
The Indian Media industry is on an impressive

growth path.
The industry is expected to grow at a much faster

rate than the global average rate.
Advertisements
Growth is expected in retail advertisement, on the

back of factors such as several players entering the
food and beverages segment, e-commerce gaining
more popularity in the country, and domestic
companies testing out the waters.
The rural region is also a potentially profitable

target.
Advertisements
The Indian Media industry is a growing sector for

the economy and is making high growth strides.
Proving its resilience to the world, the Indian

Media industry is on the cusp of a strong phase of
growth, backed by rising consumer demand and
improving advertising revenues.
Media Future
I’m really optimistic about the future of journalism. But

I do think that if you polled a hundred of my Media
colleagues and asked them about the future of the
media company more often than not they’re going to
say it is possible.
Media Future
The general view is that news is a growth business.
There are many more people are accessing and interested in

and engaging with news today than ever before, thanks to
technology.
References
Media Reports
Press Releases
Press Information Bureau
Department for Promotion of
Industry and Internal Trade (DPIIT)
KPMG(KLYNVELD PEAT MARWICK
GOERDELER) Report
Media Ecosystems: The walls fall
down – September 2018
Thank You

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Media Management

You think we are going to calculate the amount of investment

However it is difficult to calculate investment in media as

It is clear that business owners encounter various challenges

Among the challenges they face include

Nevertheless, determining the media ROI remains as the

In addressing this challenge, we should first define ROI.

ROI is the most common profitability ratio that establishes the

However, it is factual that calculating ROI is difficult, may not be

Actually, there is no universal way of measuring the ROI of the social

However, this may not be an effective measure of ROI.

We can measure ROI using metric tools that foster conversion

In addition, we can measure ROI by analyzing readership profile by

This defines how far the advert went.

Moreover, we can analyze traffic to determine the ROI in media

There are several ways to invest in media, depending on

the financial returns you seek

the term of your investment and

where you are in the world.

Investors choose their interest rate (up to 15%) and

the term of investment (from 1 to 10 years)

There is no limit on the amount that can be invested, while

The venture capitalists who are willing to back media

For instance, the investment of Kothak Mahendra in Business

The industry has been largely driven by increasing

Internet has almost become a mainstream media

The Indian advertising industry is projected to be

At present, advertising revenue accounts for around

India's media consumption has grown at a CAGR

The industry provides employment to 3.5-4 million

14 Mar 2016: Govt. increases FDI limit in News

As of September 2018, Companies announced video

5 private equity investments deals were recorded of

The Telecom Regulatory Authority of India (TRAI)

The Government of India has agreed to set up the

The Indian and Canadian Government have signed

The Indian Media industry is on an impressive

The industry is expected to grow at a much faster

Growth is expected in retail advertisement, on the

The rural region is also a potentially profitable

The Indian Media industry is a growing sector for

Proving its resilience to the world, the Indian

I’m really optimistic about the future of journalism. But

The general view is that news is a growth business.

There are many more people are accessing and interested in

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