Will competition for DD Free Dish slots intensify with resumption of TV news ratings?

With TV news viewership data all set to make a comeback after a 15-month hiatus, the competition for MPEG-2 slots on DD Free Dish, Prasar Bharati's free Direct To Home (DTH) platform, is expected to heat up. While the e-auction for vacant MPEG-2 slots is slated to begin on 7th March, the news channel ratings will resume on 17th March.

According to industry sources, the rating blackout had prompted certain news channels to give DD Free Dish a miss. They say the resumption of news ratings might encourage more news channels to bid for slots on DD Free Dish now. The increase in the number of bidders from the news genre has the potential to jack up prices further as more players will jostle for a limited number of slots.

In the previous annual e-auction that was conducted in February 2021, Prasar Bharati saw a 23% growth in the annual slot fee at Rs 731.34 crore from the sale of 57 MPEG-2 slots. A large part of this growth had come from intense bidding by news channels. A leading Hindi news channel had also emerged as the single highest bidder across genres with a winning bid of Rs 22.05 crore.

Channels in the news and current affairs genre had bid a whopping Rs 190.3 crore for 11 slots with an average slot price of Rs 17.30 crore on a reserve price of Rs 7 crore. The winning bidders included Aaj Tak, Aaj Tak Tez, ABP News, India TV, NDTV India, News 18 India, News Nation, Republic TV Bharat, TV9 Bharatvarsh, Zee Hindustan, and Zee News.

It is to be noted that the February 2021 annual e-auction happened in the backdrop of a rating blackout in October 2020. However, the Broadcast Audience Research Council India (BARC) India's decision to suspend news viewership data didn't have any impact on the e-auction.

With news ratings making a comeback, the situation might work out in the favour of Prasar Bharati, the CEO of a leading news network told exchange4media on the condition of anonymity. "No news channel can afford to give DD Free Dish a miss. With news viewership data making a comeback, all the channels will be vying aggressively for DD Free Dish slots," he noted.

The CEO also stated that DD Free Dish has a huge reach in markets like Uttar Pradesh and Bihar, which makes it a critical platform for Hindi news channels. "Most of the big advertisers, particularly the FMCG clients, are looking at the rural market. DD Free Dish with its huge penetration in rural India comes in handy for news channels and their advertisers. Earlier, Print was the go-to medium for advertisers to reach their audiences in rural India but the popularity of DD Free Dish has opened new avenues for clients. DD Free Dish is very crucial for ratings since BARC has given good weightage to the platform," he said.

However, the CEO contended that news channels were paying a huge amount of money despite marginal gains in the form of ad revenue. He said there was an 'artificial' increase in slot prices since the number of slots available for bidding is not disclosed.

"Entertainment channels don't pay that much for DD Free Dish slots and earn much more ad revenue. One of the top Hindi news channels paid Rs 22 crore for a DD Free Dish slot. This is not commensurate with the returns," he said.

Another senior official from a top news network concurred that Prasar Bharati needed to be transparent about the slots on offer to prevent a bidding war in the news genre. "Prasar Bharati should disclose the number of DD Free Dish slots that are up for grabs. News channels have been bidding a crazy amount of money for DD Free Dish slots since there are too many channels fighting for fewer slots. The decision to not disclose the total number of slots on offer pushes news channels to become hypercompetitive," he stated.

This was hurting the bottom line of TV news companies, he further said. The official also revealed that the news channels have communicated their concerns to Prasar Bharati. "On a base price of Rs 7 crore, news channels are paying Rs 15 crore to Rs 20 crore. News channels have impressed upon Prasar Bharati to disclose the number of slots up for auction. If Prasar Bharati reveals the number of slots on offer it will bring some sanity to the market."

The official went on to add that other genres like Hindi GEC and movies were not paying as much money for DD Free Dish slots as the news channels. "A leading Hindi GEC, which has a Rs 500-crore top line, is paying just half of what a top news channel is paying for a DD Free Dish slot, whereas news channels are paying a higher fee despite marginal ad revenue compared to GECs," he noted.

He also stated that the public broadcaster needs to consider the concerns of news channels. "Prasar Bharati needs to address this anomaly. Discussions have started on whether or not to be on DD Free Dish," the official revealed.

According to the official, a DD Free Dish slot made sense till the time news channels were paying Rs 6-7 crore a year for a slot. "All of a sudden it has become 3X of what we were paying three years ago. DD Free Dish has a 15% weightage in the BARC universe," he claimed.

Sharing more insights on the issue was the ad sales head of a news broadcasting company, who noted that news channels were vying for a DD Free Dish slot since it offered a huge reach with an estimated 40 million base. The executive also pointed out the increase in the price acquisition price of DD Free Dish slots was putting a huge burden on news broadcasters.

"For news channels, reach is a very important factor. Even time spent is not that important. DD Free Dish provides that incremental reach and that's the reason it is so critical for news channels. However, the increasing cost of buying a slot on DD Free Dish is making it unaffordable for news channels. Therefore, news channels have been forced to go back to the drawing board and rethink their distribution strategy vis-à-vis DD Free Dish," the official remarked.