The idiot box is feeling the heat of the number three race.

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The idiot box is feeling the heat of the number three race. The crown is passing hands almost on a monthly basis. A battle or two is won by every new channel. But who will eventually win the war? Pallavi Srivastava investigates...

‘Everything is transient and it’s unwise to hold onto things, as tomorrow they simply may not be around’ is what Lord Krishna preached in the Bhagavad Gita. Centuries later, the fight for the number three general entertainment channel (GEC) crown on the Indian teletube is becoming equally transient. After the launch of three new GECs – 9X, NDTV Imagine and Colors, GEC rankings are changing on a fortnight to fortnight basis. So what is it that is making viewers so volatile? Why are new channels unable to sustain their high TRPs (grabbed in the first flush of their launch)? And does that means that in the long run the GEC equation will just keep shuffling between Star, Zee & Sony?

Sample this: In May 2008, 9X was at number three with a channel share of 11% while NDTV Imagine and Sony lagged behind with a 9% channel share. In July 2008, NDTV Imagine led the number three race with 10% channel share, 9X followed with 9% channel share, Sony’s channel share was 8% and the newly launched Colors had 4% channel share. In August 2008 (from 1st August till 25th August), Colors jumped to number three with 12% channel share. Sony, NDTV Imagine and 9X followed with 9% channel share each (as per aMap ratings).

The numbers clearly indicate that every time a new GEC is launched it replaces the existing number three. But unfortunately the neonate is not able to sustain it for long and loses to another new kid on the block. Anooj Kapoor, Business Head, SAB attributes it to the novelty factor. “If there are three apple sellers in a market and the fourth one comes and shouts that I have different apples, a lot of people would want to taste his apples. But when they realise that his apples too are just the same, they return to the original three.” In between the hullaballoo created by new channels, veteran Sony has started regaining its lost TRPs, thanks to some innovative programming and some star value (a la Salman Khan in Dus Ka Dum). So much so, the second week of August saw Sony outshine 9X and NDTV Imagine, both in terms of GRPs and channel share.

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Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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Curbing Inflation

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...a power packed punch from RBI

Ever since the inflationary beast crossed RBI’s tolerance level on March 1, 2008, there has been no looking back. As a matter of fact since then inflation has surged by over 84%. In fact the Central Bank has finally accepted that curbing inflation is its prime objective and has been taking a series of measure to limit the beast. As an antithesis to the efforts, the beast has been galloping at a faster pace and is pegged at a 13 year high at 11.42%; it is evident that the public’s ‘tryst with inflation’ continues.

The two recent measures, increasing the repo rate (rate at which the central bank lends to banks overnight) and CRR (cash reserve ratio, proportion of deposits that banks are required to keep with the central bank) by 50 basis points (bps) will have its impact on the corporate houses as well as individuals. As a measure to anchor inflation, the hike in CRR will suck Rs.200 billion from the market and help in restraining demand. For banks already struggling with high borrowing costs, the added burden will only lower its earning from each loan. Amid tightening monetary policy, it is the individuals and the banks that are the worst hit; individuals will either have to increase their loan repayment period or else bear the brunt of increased lending rates. And for the banks the difference between the interest earned from loans and the amount paid to depositors will further narrow down. “The CRR and Repo rate hikes are larger than expected. These will increase the costs for banks who in turn are expected to raise lending and borrowing rates in the days to come. Higher rates are expected to impact both consumers and corporates,” Dipen Shah, VP, PCG-Research Kotak Securities tells 4Ps B&M.

Banks have already started raising their prime lending rates (PLR); SBI has increased its BPLR to 12.75%, Union Bank to 13.25% ICICI to 13.50% et al and others are considering similar moves. For an individual who wants to settle the loan repayment in time, it means an increased EMI (for instance, for an amount of Rs.2 million for a period of 20 years the EMI at 12.25% would be Rs.22,371 while in the present scenario it could be as high as Rs.24, 147). Further, corporates too need to rethink on their capex plans for the cost of working capital and long term debts are likely to move northwards. In such a scenario it’s only those who have surplus cash who can benefit by higher interest rates on their savings; but considering the double digit inflation the fears of negative interest on the surplus looms large.

However the question is, will the RBI continue tightening monetary policy? Tushar Poddar, VP Asia Economic Research, Goldman Sachs, avers, “The RBI will wait and watch inflationary trends over the next several weeks, particularly signs of pass through to broad based inflation and broad money growth, before raising rates again.” Well, as everyone battles with inflation RBI’s next review of the monetary policy will be worth watching.

Gyanendra Kashyap

For more articles, Click on IIPM Article.

Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.
IIPM Programme :- SUPERIOR COURSE CONTENTS
IIPM INTERNATIONAL - NEW DELHI, GURGAON & NOIDA
IIPM - Admission Procedure
IIPM, GURGAON
IIPM : EXECUTIVE EDUCATION
IIPM’s 36th Glorious Year of Academic Excellence
IIPM Ranked No. 1 B-School In Global Exposre - Zee...
4Ps Power Brand Awards 2007
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Why Study Abroad When IIPM Gives You 3 global Advantages!
IIPM Ranked No. 1 B-School In Global Exposre - Zee...