The Troubled Soap Opera Doordarshan

Pramita Athikary

ContentsContentsExecutive summaryExecutive summaryBackground of doordarshanBackground of doordarshanProblems of doordarshan, sagging Problems of doordarshan, sagging

revenuerevenueDoordarshan’s strategy in their life Doordarshan’s strategy in their life

cyclecycleRecommendationsRecommendationsConclusionConclusion

Executive Summary This case study covered the analyzing views

of the problems & also puts a question that “Is the Government taking some serious steps for solving these problems?”

This Case Study is actually based on the different types of problems of Doordarshan which plagued their performance. And one vital question arises that “ IS DD DEAD?“

BackgroundBackground Doordarshan is the public television broadcaster

of India and a division of Prasar Bharati, nominated by the Government of India

It was launched in Delhi on 15 September 1959 with a small transmitter and a makeshift studio. Later it extended to Bombay and Amritsar in 1972.

It came into existence as a National broadcaster in 1976.

Has a three tier programme service – National,Regional and Local.

In 1984 it added a second channel named DD 2 to provide alternate option to metro population in India.

Services 2 National Channels – DD National and DD

News

11 Regional Channels

1 International Channel

4 State Networks

1 Sport Chanel – DD Sports

2 Live broadcasting of parliamentary proceedings – DD – RS and DD - LS

Some Views About Case Study

When DD was launched in the market, they enjoyed When DD was launched in the market, they enjoyed monopolymonopoly.. They earned almost 100% revenue at that They earned almost 100% revenue at that time. In 1982 DD only presented as a regular satellite time. In 1982 DD only presented as a regular satellite channel.channel.

During 1992-1994 the number Cable & satellite During 1992-1994 the number Cable & satellite channels entered into the media market & they channels entered into the media market & they decreased DD’s revenue growth rate to nearly24%.decreased DD’s revenue growth rate to nearly24%.

After 1994 DD encountered After 1994 DD encountered Oligopoly marketOligopoly market & & faced the heat of competition from the market.faced the heat of competition from the market.

During 1996-1999 DD revenue growth rate had gone During 1996-1999 DD revenue growth rate had gone down by 70.17%. After that in 2000 government down by 70.17%. After that in 2000 government appointed a committee to solve all kind of problems & appointed a committee to solve all kind of problems & regenerate the good revenue.regenerate the good revenue.

DD’s Business Model In 2001 model was to sell ½ hour slots to

programme producers.

For first 26 episodes of the programme – 42 lakhs plus the production cost.

In exchange the producer gets 720 seconds of the commercial time that he can sell to advertisers and generate revenue.

For 10 sec slot producers charge Rs.70000 to advertisers.

Similarly beyond 26 episodes the minimum tariff’s for the producers is 66 lakhs.

Hence, producers charge advertisers Rs1 lakh for 10 sec slot in order to break-even.

Advertisers were facing problem since the competitive rate for a 10 sec slot was Rs 50000.

As a result DD’s revenue went on decreasing as advertisers were approaching other private channels.

Problems Of DD DD was plagued by multiple problems, which

found their roots in the mismanagement of affairs.

In late 1990’s DD faced number of allegations of large-scale scams and irregularities. Under utilized infrastructure, improper investments and poor financial management plagued the performance of DD.

Private channels had their own marketing teams, where DD had 56 different producers but no marketing team.

Cable Onslaught Cable TV was introduced in India during the year

1984 considering a cost effective alternative to watching borrowed cassettes of feature films.

Also investments required to install cable network was also very low.

In 1992,Zee TV was launched and soon it became the driver for cable TV market in India. Soon more than 60 private channels were launched.

The Cable and Satellite network reached nearly 30 mn homes.

Cable TV growth in Urban India

Sagging Revenues Over the period TV advertisement market grew by 76 %.

But DD’s revenue from advertisements registered a negative growth.

CONTD.....

During 1998-99 DD earned negative growth of revenues as they lost out on viewership segments with the highest purchasing power.

70 per of HLL’s ad spent went to DD till 1998-99. Due to poor TVRs in 2000-01 HLL’s share in DD’s AD revenues had gone down to 50%

TVRs also decreased because producers & distributors stopped giving Films to DD when asking for minimum guarantee of Rs 10 mn to broadcast a film.

Analysts felt that DD's revenues were going down because advertisers considered it as a down-market channel.

Tangle Of Problems DD has lost its identity due to conflict that-is it a public

broadcaster or a commercial entity?

Political interference & corruption were another reason for DD’s poor performance.

ABCL was DD’s highest debtor with outstanding dues of Rs 330 mn.

DD allowed ICC chief Jagmohan Dalmiya to defraud DD for Rs 160 mn over the telecast of a 1998 tournament in Dhaka.

DD news lost its viewers to Star News & ZEE News.

SWOT Analysis : Growth stageGrowth stage

SWOT Analysis : Maturity stage stage

SWOT Analysis : Decline stage stage

Fresh Lease Of Life S.S .Gill was sacked in 1998 and Rajeeva

Ratna Shah was appointed as the CEO of Prasar Bharti.

In 2000 govt. appointed a committee which came upon with three options –

- Privatization of DD - DD continuing as a PSB - Running DD on both PSB and

commercially viable lines Committee recommended the third option

and took the following steps : 1.To downsize 25 % of DD’s 21,000

strong staff 2.Getting into new media

3. Getting up its own marketing department 4. And developing a sharper programming focus.

To improve the quality of broadcast DD sought the help of BBC to digitise its channels.

DD went in for revenue sharing deal with B4U for showing movies.

DD also entered into an agreement with the Direct to Home (DTH) platforms like Echostar and Astra to distribute DD-World in 79 countries.

The National Institute of Design was employed to redesign the logo.

Best strategic alternative before DD?

• Mixed Approach – Privatization and Public Service

broadcaster• Economize its operational aspects• Optimize use of infrastructure• Improve on Quality and viewership of

programmes • Reduce bureaucracy• Strategic Initiatives

Our Views• It should be economized on its operational aspects

and ensure more productivity in term of revenue generation and optimization of use of its infrastructure.

• At the same time quality and viewership of programmes should be improved.

• Complete privatization can fetch a good sum and may solve many of the managerial and operational problems.

• Setting up its own marketing department.• It should include some innovative programmes that

can more attract the viewers.