Chapter 1

Introduction

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 Chapter 1
Introduction

1.1. Background

Media is a tool for communication that can be used for either storing the information or

delivering the information or data. Mass communication emerged with the rise of mass

media such as press, photography, cinema, broadcasting, and publishing. Recent

advancements in technology changed the relationship between media and society for the

better (McQuail, 1994). Media such as television, newspapers, radio, books and cinema

help in serving the social and psychological needs of the society (Katz et al., 1973). In

today’s world, “Media” refers to a range of communication channels, from television to

new media. New media includes internet, smart phones, websites, gaming, animation,

Visual Effects (VFX), blogs, wikis, etc. As observed in Figure 1.1, digital advertising

remains to be the predominant industry exhibiting an increase in growth of 28%,

followed by animation, gaming, radio and music industries.

Johnson and Kaye (1998) compared online and traditional media based on their

credibility, as people do not pay attention to the media which they do not perceive as

credible. Traditional information sources are scrutinised for accurate reports; whereas,

internet sources are not subjected to such pressures. The unregulated flow of information

from the internet has caused the people to question its credibility. Media is generally

classified into two types, namely, print media and electronic media based on the type of

medium used for communication (Kipphan, 2001), which are described in the subsequent

sections.

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 Figure 1.1: Size of the media and entertainment industry in India
Source: Adopted from FICCI-KPMG report (2017)

1.1.1. Print Media

The significance and use of print media is growing worldwide. Though the present age is

considered to be the age of electronic media, the presence of printed information is

inevitable. The print media today offers various products ranging from commercial

printing to periodicals. The print media constantly strive to specialise in the current

market segment to stay competent in the media industry. Commercial printing involves

catalogues, brochures, visiting cards, etc.; whereas, periodicals refer to printed material.

The printed products can be categorised as books, newspapers, magazines and so on.

Printed books were considered to be low-cost mass medium, which were delivered either

in one color or multi-colour. Magazines include periodicals and journals which are

published by publishing houses. Newspapers are still one of the significant mass media

today. Newspapers differ from magazines and consist of large sheets. A typical

newspaper consists of different sections carrying content with photographs and

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advertisements. Newspapers are financially supported by advertisements (Kipphan,

2001). Other print media may include printing on various materials such as cardboard,

glass, plastic, etc.

1.1.2. History and development of print media

The art of printing was invented by the Chinese in 600 A.D. The first printing machine

was invented by Guttenberg in 1440 which led to the mass production of any printed

material. Prior to the printing machine, books were hand written. This technology helped

in reaching the audience to provide them with information. The invention of printing

machine marked the birth of mass media. In order to provide information to the masses,

newspapers were introduced to carry and spread the information across. Present

newspapers evolved as a result of necessity, invention, democracy and professional

standards. The earliest newspaper was a daily sheet which was published in 59 BC in

Rome. The earliest known printed newspaper was in Beijing in 748 (Odorume, 2012).

The practice of printing spread through Europe through the invention of German printers.

By 1500s, more than 250 places in Europe had printing presses. The first news report was

published in Germany in 1502. The double column in the newspaper was first utilised in

“Oxford Gazzette”, which was published forty four years later in England. The

Oxford/London Gazette was considered to be the first true newspaper. “Public

Occurrences Both Foreign and Domestic” was the first published North American

newspaper, which was published in Boston in 1690.

The development of daily newspapers was encouraged by rising literacy rates, postal

systems, democratic form of government, the formation of different states and the

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advancements in technology which supported the production of newspapers. The first

daily newspaper in London was started in 1702, called “The Daily Courant”. The first

daily newspaper in France appeared in 1777, named as “Journal de Paris”.

The evolution of print media was slow in Russia and in other Christian orthodox

countries like Serbia, Romania and Bulgaria. The revolution of print medium was not

only dependent on technology, it also required favorable cultural and social conditions.

Print culture could not be penetrated into Russia due to the lack of literacy (Briggs &

Burke, 2009). The first mass production of newspapers started in 1833 in New York with

the rise of the middle class. Newspapers with illustrations appeared in 1873. A full page

advertisement appeared in newspapers in 1878 and the first photographs with the help of

halftones appeared in newspapers in the same year. The late 19th century and 20th century

saw the evolution of newspapers as a result of professional development and adaptation

to meet the changing consumer needs and market needs. By the end of the twentieth

century, media became a full-fledged industry with the advancements in the

telecommunications industry. Commercial communication enhanced as a result of

capitalism and development in communication technologies (Müller & Tworek, 2015).

In India, the first Indian newspaper to be printed was “Bengal Gazette” in 1780. The first

Gujarati newspaper was “Bombayna Samachar” now Mumbai Samachar, was started by

Fardunjee Marzban in1822. The first newspaper in South India was “The Madras

Courier” in 1785. “Bombay Herald” was the first newspaper to be published in Bombay

in 1789. It was followed by “Bombay Courier” which had Gujarati advertisements. The

first vernacular newspaper was “Samachar Darpan” in Bengali. The first newspaper in

Hindi was “Oodunt Marthand” published in 1826. Print media, newspapers in general,

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play an important role in determining the government’s responsiveness towards its

citizens (Besley & Burgess, 2002). It was found that the government of states which have

high levels of newspaper circulation and literacy rates were more responsive towards

their citizens.

The role of print media in the Indian independence movement was inevitable. During the

independence struggle, newspapers and print media helped in propagating messages to

the people to instill patriotism in the hearts and minds of the people. The freedom fighters

as well as social reformers in India helped in the development of print media. Some

freedom fighters like Mahatma Gandhi and Raja Ram Mohan Roy started their own

newspapers to spread the truth and create awareness among the public regarding social

reforms and amelioration. Newspapers helped in motivating the people to join the

freedom struggle (Patil, 2011). Newspapers helped in shaping and molding the public

opinion; thereby, developed a national institution. Newspapers were very powerful in

bringing positive changes to the people (Aggarwal & Gupta, 2002). Magazines which

were attractive and colorful helped in educating the people. Before the invention of

printing press, block letters were used for printing, which were replaced by monotype and

linotype printing. Typewriters were later used for printing, which were replaced by laser

printers and offset printers. Advanced printing presses, which made the process of

printing easier, evolved after industrialization. Liberalization, privatization and

globalization were introduced in print media by the government of India in 1993.

Newspapers, journals and periodicals helped in spreading the political agenda. Many

vernacular newspapers started to evolve in the vernacular language. Though the habit of

reading newspapers is decreasing everyday among today’s youngsters, some people

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especially the adults above 60 years of age stick to their habit of reading newspapers in

the morning. Different forms of print, other than newspapers and media, such as flex

boards and advertisements on the road sides help in promoting a brand.

1.1.3. Growth trends in print media

Post-independence, the newspapers saw a phenomenal rise in their circulation numbers.

New technologies were deployed to make the newspapers more attractive and to

introduce multiple editions. In 1941, India had 4,000 newspapers and magazines in 17

languages. According to the first Press Commission, there were 330 newspapers and

1,189 weeklies in 1952. The number of newspapers increased to an average of 5% every

year except for some years. By the end of 1998, there were 43,828 newspapers as against

41,705 in 1997. These included 4,890 daily newspapers, 15,645 weeklies, 12,965

monthlies, 1,474 publications along with other periodicities. The number of dailies,

publications and other periodicities were 51,960 in 2001. The number of registered

newspapers was 1,05,443 in 2015 as against 99,660 in 2014. In India, the number of

circulation of newspapers in 1998 was 126,849,500 copies. The total circulation was 15,

67,19,209 copies in 2004-05, which has increased to 45,05,86,212 copies in 2013-14.

The Indian Readership Survey findings in 2010 showed that the largest read vernacular

language newspaper were Dainik Jagran and Dainik Bhaskar, both are published in Hindi

(Patil, 2011). According to the FICCI-KPMG joint report, the net worth of the Indian

newspaper industry was 4.51 billion in the Indian financial year of 2017 (IBEF, 2017).

The number of approved newspaper titles in India in 2010 was 13,229. The largest

number of newspapers (including periodicals and journals) in India was in Hindi (32,793)

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followed by English (11,478). According to the minister of state for Information and

Broadcasting, the total number of registered newspapers in India was more than 74,000 in

2011. The state of Uttar Pradesh had 11,789 registered newspapers, Delhi had 10,066

registered newspapers and Maharashtra had 9,127 registered newspapers (Patil, 2011).

The number of copies of print media in India raised up to 2.37 crore during the period

from 2006 to 2016 with a CAGR of 4.87% over the ten-year period (ABC, 2017).

According to the report, the average number of copies per day which was 3.91 crore in

2006 rose up to 6.28 crore in 2016 with a CAGR of 7.83% in the Northern parts of the

country. The circulation growth with respect to the vernacular languages is shown below.

Hindi had the fastest growth during the period from 2006 to 2016 with a CAGR of

8.76%. The CAGR of Telugu was 8.28% followed by Kannada with 6.40%, Tamil with

5.51% and Malayalam with 4.11%.

1.49
1.5
1.53
8.76 Hindi
2.87 Telugu
Kannada
Tamil
4.11
Malayalam
English
Punjabi
8.28
Marathi
5.51
Bengali

6.4

Figure 1.2: CAGR of circulation numbers of vernacular newspapers (2006-2016)

Source: Adopted from ABC (2017)

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Press and print medium used to be the dominant medium for advertising. The revenue

from print advertising was 108 billion Indian rupees in 2008 and it increased to 126

billion in 2010. The revenue from advertisements in the print media further increased

every year and it was 189.3 billion in 2015, which was against 176.4 billion in 2014

(Figure 1.3). The ad revenues are projected to be 254.9 billion in 2019 and reach 296

billion by 2021 (FICCI-KPMG, 2017).

Figure 1.3: Size of advertising revenues in India

The increase in the literacy levels is expected to increase the readership base. As a result,

vernacular markets and demand for vernacular content have started to increase. The

Indian newspaper market benefits from the growing population as well as from the

increased literacy levels among the population. The literacy rate, which was only 65% in

2001, rose up to 74% in 2011. This continuous improvement in the literacy levels

increased circulation numbers and readership base of the newspapers. According to the

Audit Bureau of Circulations, the number of paid copies of newspapers increased from 38

million in 2006 to 48.3 million to 2012. Newspaper readership numbers were recorded to

be 340 million in 2012, which was only 296 million in 2006. With the rise in income

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levels and literacy levels across the country, advertisers and media planners utilize the

vernacular newspapers for their marketing. In 2012, it was found that the readership of

top Hindi and other top vernacular newspapers was found to be 133 million (India

Entertainment and Media Outlook, 2012). Hence, it can be found that readership levels

increase with the increase in literacy levels and from the language newspapers market.

Corporatization and corruption pose a major threat to the newspaper industry. Monopoly

is another problem with the present mass media. Modular advertising and sectional

pricing are some of the attributes of modern newspapers. Newspapers are continuously

applying new technologies to increase their circulation numbers. Modern newspapers

have also adopted online edition to stay competitive in the present market.

1.1.4. Electronic Media

Any media that utilises the advantages of electronic technology is referred to as

electronic media. It includes devices that can either store or deliver information

electronically. Electronic media are normally associated with the use of computers and

internet. Electronic media also encompass radio and television, which are used for

spreading the information. The most significant and notable feature of multimedia is its

interactive application which may appear differently to different users based on their

interaction (Kipphan, 2001). Electronic media also encompass entertainment and media

industry which includes television, online gaming, VFX, mobiles and smart phones, etc.

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1.1.5. History and development of electronic media

Television

In India, television was introduced with an experimental broadcast in 1959 using a small

transistor and a makeshift studio in Delhi. The regular transmission of services started in

1965. The television services were later started in Bombay and Amritsar in 1972. In

1975, there were only seven cities which had television services. National telecasts were

started in 1982. The same year saw the launch of color television. Initially there was only

one national television broadcaster - Doordarshan, which was owned by the government.

There are two significant milestones in the field of television. One was the introduction

of color TVs by the state-owned Doordarshan in the eighties and the other was the

installation of transmitters across the country for terrestrial broadcasting.

The infrastructure of media consisted mainly of newspapers, state-owned radio networks,

ad commercial film industries. This medium was used for disseminating the political

views from the center to the regions. Apart from these, print medium such as pamphlets

and posters were used to propagate the political views during the Independence

movement. With the increase in the audience numbers, commercialization of television

with the introduction of advertising started in 1970. The same year also saw the rise of

India’s first domestic satellite programme with the launch of SITE (Satellite Instructional

Television Experiment). The rapid growth of television started in 1980s. The country’s

first domestic communications satellite was INSAT-1A. With the help of this satellite,

networking of all the regional Doordarshan stations was made possible. In 1982, our

country hosted Asia games which were broadcasted in color across the country.

Privatization of TV enterprises was not started during that period. Television in those

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days was used for providing new information, grooming young talents and for spreading

the culture. Private channels started to appear in the 20th century. As per the details

furnished by the Ministry of Information and Broadcasting, the number of private

television stations and government channels as on 2016 were found to be 857 and 190

respectively (MIB, 2016).

Radio

Radio is a one-way communication with the mass audience, which transmits the content

wirelessly. Broadcasting in India was started in 1923 and the first ever broadcast was the

Radio Club of Bombay. The Calcutta Radio Club was started later in the same year.

Lionel Fielden was the first controller of Broadcasting in August in 1935. In 1936, the

Indian Broadcasting Service came to be known as the All India Radio (AIR) which is one

of the largest media organizations of the world. AIR had 243 radio stations in 2015 and

broadcasted in 23 languages (TRAI, 2015). In order to keep the overseas listeners

informed about the developments in the country, External Services Division was started,

whose programmes are broadcast in 11 Indian and 16 foreign languages in more than 100

countries across the world (MIB, 2014). Broadcasting also played an important role in

achieving political integration, economic development, and social organization before

and after independence. The main objectives of the All India Radio are national

integration and development of national consciousness. Radio was considered to be an

instrument for fostering unity and integrity among the people. Radio is a potential

communication medium to reach people at all levels (Shukla, 2017).

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Internet

Internet has a worldwide broadcasting capability. Hence, information dissemination

across the world and interaction among the individuals has been made possible. Data and

programs could be accessed quickly through a set of interconnected computers. The first

network of social interactions was established in 1962 through a series of written memos

by J.C.R. Licklider of MIT University. He headed the computer research program at

DARPA (Defense Advanced Research Projects Agency), where he emphasised the

importance of networking concepts. The first paper on networking was published in 1961

by Leonard Kleinrock (Leiner et al., 2009). The early stages of the internet were devised

in American research laboratories (Cohen-Almagor, 2011). The world’s first network

based computer systems known as ARPANET (Advanced Research Projects Agency

Network) was developed in 1967 by Roberts, funded by the DARPA community.

Kleinrock’s packet-switching theory was used in the analysis and design of ARPANET.

Users could access files at different locations and transfer files between computer via

Network Control Protocol (NCP) (Cohen-Almagor, 2011). Later, open architecture

networking, introduced by Kahn in 1972, allowed the networks to be designed according

to specific requirements. In order to meet the needs of the open architecture network,

Transmission Control Protocol/Internet Protocol (TCP/IP) was developed. ARPANET

was solely dependent on NCP which had no end-to-end host error control. Hence, TCP/IP

was designed as a communications protocol which also provides host error control.

TCP/IP helps in transmitting the data in the form of data packets from the source to

destination, checks for errors, ensures the flow of control and provides global addressing.

The network of publicly accessible computers via TCP/IP came to be called as Internet

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(Slevin, 2000). ARPANET and Internet were originally designed for resource sharing.

File transfer, remote login (TELNET) and electronic mail were some of the significant

innovations of that era. The internet was designed as an infrastructure on which various

other applications can be developed (Leiner et al., 2009). Large workstations and time

sharing systems later became part of the internet. The increasing number of hosts

challenged the capability of the routers. Various academic and research communities

started using the wide area networking infrastructure for carrying out the research.

Internet technology was later implemented to develop various competitive, private

network services to establish various commercial products.

The media or the data is secured and stored in a designated server, which has the license

and copyright for broadcasting the information. Users are connected to this server via

internet to obtain this data or information. Once registered on the server, the information

will be available for a limited period of time specified in the license and the license can

be renewed through the approved server. Users who do not hold a valid license will only

be permitted to view the data but are not allowed to save or shift the data without any

prior authorization from the server. The data is further validated using digital signatures

(Erickson, 1998).

Internet has removed several communication barriers across the nations by introducing

several new diverse forms of communication. Internet medium minimises physical

distances, inequalities and prejudices; thereby has a positive impact on the public issues.

Wikipedia which was launched by Jimmy Wales and Larry Sanger in 2001 has 17 million

articles and serves as the largest reference resource on the internet (Cohen-Almagor,

2011).

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India became the second largest internet market in 2015 in terms of number of internet

users after China. The number of Internet users is expected to reach 400 million in 2017.

According to the networking giant Cisco, the number of internet users was expected to

reach 829 million in 2021. The internet usage in India was about only 8% during the

period from 1995 to 2010. Since then, the figure reached to over 30% from 2011 to 2015.

A phenomenal increase is recorded during 2014-15. In other words, it took 15 years to

reach 100 million internet users, three more years to reach 200 million years, one more

year to reach 300 million and yet another year to reach 400 million. The rapid growth in

the use of internet in the recent years can be attributed to the widespread mobile internet

access.

1.1.6. Outdoor Media

Outdoor media refers to media out-of-home, which reaches the people when they are out

of their homes. This media is mainly used for advertising. Outdoor media include

billboards, street furniture and moving vehicles which can be used to advertise products

or services. In India, city development to an extent is dependent on the advertising

revenues from the outdoor media. The main sectors which advertise using the outdoor

medium include FMCG (Fast Moving Consumer Goods), auto, media & entertainment,

telecom and financial services. Outdoor media are mainly used for political campaigns to

reach a large audience. One of the main advantages of outdoor medium is its affordability

in terms of business-to-business marketing (Gurumoorthy, 2015).

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Hoarding/Bill boards

Hoardings refer to advertisements or sign posts that are placed on the roadsides or public

places. Hoardings are temporary and are placed on a contractual basis. Hoardings are a

means of outdoor advertising. Hoardings are placed in places where the majority of the

public could check out what has been displayed. They are generally displayed on bus

shelters, mall displays, information kiosks and such. Some moving vehicles displaying

advertisements are stationed at some of the common areas of transit such as airports,

stadiums, railway stations, etc. Mobile LED trucks that carry hoardings are stationed

anywhere in the city by the advertisers (India Entertainment and Media Outlook, 2010).

1.1.7. Reach of print and electronic media in India

Print media

The print industry in India saw a decline in its growth from 16.9% in 2008 to 8.7% in

2009. The growth rate further decreased to -0.3% in 2009. The growth of print industry in

2013 over 2012 was found to be 8.5% and is expected to be 9% in 2018. According to a

report by FICCI-KPMG, the print industry continued to display retarded growth in 2016,

especially in the case of English newspapers (FICCI-KPMG, 2017). Regional markets of

the print industry performed well due to the steady backing by advertisers. Advertising

revenues for the vernacular newspapers are covered by the local retail and advertisement

agencies. Further, the growth of the local newspapers is also supported by people’s

affinity to consume the content in local language. The growth of vernacular language

newspapers in tier II and tier III cities was projected to be 4,870 crore in 2017 (CAGR-

11%); whereas, the growth of English print industry was projected to be 4,150 crore in

2017 with a CAGR of 5%.

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The circulation numbers and advertising revenues for the vernacular newspapers were

found to be increasing in 2015. The number of print media publications in India grew

5.13% in the year ended 31 March 2016.

A total of 5,423 new publications was registered during the year, taking the total count of

registered publications to 110,851 from 105,443 in the previous year, according to a

report, ‘Press in India 2015-16,’ prepared by the Registrar of Newspapers of India (RNI)

and unveiled by the Minister of Information and Broadcasting (I&B), out of the total

print media publications, 16,136 were newspapers, while 94,715 were registered as

periodicals. During 2014-15, the number of print media publications had increased by

5.8% to reach 105,443. According to Audit Bureau of Circulation, India is one of the

brightest spots in the world print market as the paid daily circulation numbers are

increasing every year. The number of publishing centers is growing at a CAGR of 3.28%

and the average copies per day are growing at a CAGR of 4.87%.

Maximum growth is recorded by Hindi language newspaper whose CAGR is 8.76%

during the period from 2006 to 2016 (ABC, 2017). Vernacular language newspapers have

contributed to the largely to the growth of print media. Among the vernacular languages,

Urdu had the highest number of circulation followed by Telugu, Kannada, Tamil and

Malayalam. Hence, it can be seen that vernacular language newspapers are still popular

among the people in Gujarat, Assam, Punjab and other places in North India (FICCI-

KPMG, 2016).The print industry in India is growing at a CAGR of 7.3% only next to the

television industry.

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 English
13%

Vernacular
35%

Hindi
52%

Figure 1.4: Circulation of registered publications in 2015

Television

India has emerged as one of the largest TV markets in the world in terms of its viewers.

Doordarshan, the national television network has reached 90% of the population. Though

the transition of mass market to digital market is a challenge, digital segments have

started to expand in the country. Television sector which plays a major role in influencing

people’s beliefs and opinions experienced a growth rate of 12% p.a. during the period

from 2007 to 2010. The main streams of revenue in this sector are advertisements and

subscriptions. Television content also plays a major role in promoting this sector. The

demand for differentiated content led to the division of television content into channels

(Media and Entertainment: Digital Road Ahead, Deloitte, 2011). The growth rate of

television in 2013 was found to be 12.7% and was projected to be 16.2% by the end of

2018 (FICCI-KPMG Report, 2014).

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Advertising revenue contributes to about 2/3rd of the top broadcasters’ revenue. Due to

the fragmentation and the dominance of analog cable, the television sector suffered an

under-reporting of subscribers and Average Revenue Per User (ARPU) realization. The

disadvantages of incumbent analog cable were overcome by the DTHs. The technological

advantages have enabled the DTHs to connect semi-urban and rural areas to the world of

Indian television channels, which in turn increased the revenue of this industry. The

Indian television industry has come a long way in operating more than 600 channels with

more than 1/3rd channels operating in GEC (General Entertainment Channels).

The launch of existing channels in HD (High Definition) and the approval of 75 new

channels by the Government promises to increase the competition among the

broadcasters. Content repurposing to tailor to various demographic viewers has to be

enhanced in order to stay competitive in the media and entertainment sector.

Digitalization of TV distribution helps in realizing the true potential of their content;

thereby, helps in catering the diverse needs of the viewers. LED and LCD televisions are

replacing conventional televisions and the introduction of HD channels has resulted in the

increase in time spent in TV entertainment.

Internet

The Internet advertising industry recorded a growth rate of 85.2% in 2008 from 60% in

2006. Owing to the economic decline, the growth rate fell to 20% in 2009. The state-

owned Videsh Sanchar Nigam Limited (VSNL) introduced internet in India in 1995. In

2004, Internet had a revolutionary effect on Indian people living in villages by

introducing internet cafes and kiosks. Internet usage continued to grow in India and in

November, 2013, it was found that there are 150,000,000 number of internet users in

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India. The number of internet users further surged to 375,000,000 in 2015 at a growth

rate of 30% in a total population of 1.2 billion (IBEF, 2016). Owing to its high

effectiveness, competitive efficiency, increased usage and its attractive profile, the

population is finding the internet to be increasingly useful. Changes in the medium

through which people consume news have become inevitable in today’s world. The

Internet has revolutionised the way people seek and consume information. Some

newspapers have slowly started to digitalise their content and provide online access to

their news content all through the day.

Some of the leading newspapers in India are adopting social media for delivering the

news. India is reported to have 143 million social media users who form 65% of the

internet user base in India. The Indian Express has 85,600 followers and the Times of

India has 444,000 followers on Instagram.

Mobile phones

The mobile industry in India witnessed a revolutionary success owing to its ubiquitous

nature. Sources reveal that India has 160 million Internet users, out of which 86 million

internet users access internet from their mobiles. The number of broadband connections

was about 15 million over the last decade; whereas, the number of 3G connections was

found to be more than 22 million in the last four years. It was also reported that 9% of

overall internet page views in India are from mobile phones and 40% of overall Google

searches is from mobile phones. E-commerce and digital advertising have also appealed

to the masses in India. The mobile internet is increasingly driven by factors such as low-

cost data plans, larger screens, faster networks and access devices at affordable costs. The

growth and penetration of mobile devices in India was at a rate of 61% over the period

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from 2006 to 2012. As the growth of mobile internet is dependent on the success of

internet penetration in the country, dependency on faster and more reliable networks such

as 3G and 4G networks has become inevitable. With the help of 4G services, broadcaster

can create original content for online television viewing. The surge in high-speed

connecting devices and the availability of more content online have enabled the

consumers to adopt 4G platforms. In terms of both speed and price, 4G services have

made data consumption at par with wired broadband services. Hence, the launch of 4G

services drives the mobile internet market significantly forward. 4G communication

technology has provided some intelligent networks like open distributed AD-HOC

wireless network and software defined radio.

In India, 4G service was first launched by BSNL with the help of 4G WiMAX Broadband

in Kochi, Kerala in 2011 (Aithal & Prasad, 2015). The major source of data traffic in

2016 has been attributed to 4G services (MBiT Index, 2017). The 4G monthly data usage

per subscriber exceeded 1400 MB which was only 850 MB for 3G (Juneja, 2017).

According to Nokia, a Finnish telecom firm, 60% of the incremental data payload from

2015 levels has been contributed by 4G. 4G and 3G together contributed to 76% of the

total data traffic across the country in 2016 (MBiT Index, 2017). The growth of 4G-

enabled smartphones saw a rise of 2.7% over the previous year. According to CLSA, an

investment banking company, with the increased rate of affordability, 3G and 4G markets

are expected to expand to 300 million by 2018 (India's Data Traffic Growth in 2016 Led

by 4G Technology: Nokia, 2017).

The number of mobile internet connections in India is expected to rise at 20% CAGR to

reach 543 million in 2018 (India Entertainment and Media Outlook, 2014).

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Film industry

The media and entertainment industry in India generated revenue of 1,120 billion INR in

2013 which is an increase of 19% than the previous year. The entertainment industry has

been predicted to grow at a CAGR of 15% during the period from 2013 to 2018.

Adoption of smartphones and tablets are becoming a promising source of revenues for

the entertainment industry. The film industry is likely to grow at a CAGR of 12%

between 2013 and 2018 and is expected to reach revenue of 217 billion INR in 2018

(India Entertainment and Media Outlook, 2014).

India produces more than 1000 films annually across 20 key languages (IBEF, 2017).

The film industry contributed 1.89 billion US$ in 2014 and is expected to grow at a

steady CAGR of 10%. The media and entertainment field is likely to grow at a CAGR of

14.3% to reach a revenue of 33.7 billion US$ by 2020 (IBEF, 2017). Digitization of

movie screens and the availability of a variety of content upholds the film industry to

record a double digit growth.

The film industry is Gujarat is experiencing a revival after a decade long slump in the

recent years. Gujarati films have been performing well in the box offices. The box office

collection in 2015 for Gujarati films was 550 million INR. Regional cinemas experience

new markets with greater distribution and marketing (FICCI-KPMG, 2016).

Animation industry

The Indian animation industry, whose net worth was US$ 511 million in 2010 exhibited a

growth of 16.4% in 2016, while the VFX industry showcased a 31% growth owing to the

increased use of VFX by the film industry (FICCI-KPMG, 2017). In 2010, three

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animation TV channels were launched in India. Achieving revenue of 15 million INR, the

Indian animation industry registered a growth of 8% in 2016. This industry is expected to

be shaped by the trends in domestic and outsourcing activities and is expected to reach 23

billion INR in 2020 (FICCI-KPMG, 2017).

Hoarding

Hoarding and other Out-of-Home (OOH) advertising represents one of the fastest

growing advertising sectors in today’s market. At present there are forty advertising

agencies in the OOH industry. The growth of the outdoor medium in India was at a

CAGR of 17.3% during the period from 2006 to 2008 (FICCI – KPMG, 2009). OOH

industry marked a growth of 13% in 2015 which was mainly driven by e-commerce and

telecom sectors. OOH industry continues to grow as new malls, corporate parks, airports,

and metro lines continue to expand. Hoardings/bill boards and other outdoor medium are

becoming increasingly popular due to interactive content and precision targeting with

data analytics. With the help of recent technological advancements, the advertisers can

find out the age, interests and number of people at any particular location for any given

period of time (morning, noon or evening). Hence, marketers can achieve precise

targeting using OOH advertising which in turn will improve their Return On Investment

(ROI) on marketing. The outdoor media is expected to grow at a CAGR of 13.1% to

reach revenue of 45.2 billion INR in 2020. The revenue generated by OOH in 2015 in

India was 24.4 billion INR (FICCI-KPMG, 2016).

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1.1.8. Challenges Faced by the Print Media

Due to the ever-increasing technological advancements in electronic media, the Print

media faces two important challenges. The first challenge is that the print media has to

meet the needs of the advertisers who are the main source of its revenue. The advertisers

have started to cut back on paid ads and started to invest on online websites and viral

marketing. Conventional advertising have been replaced by digital advertising. Paid ads

cannot be expected to recover fully as the impact of online marketing and digital

advertising tend to raise the marketer’s expectations of the conventional media. The

digital advertisement spends reached 60 billion INR in 2015, which was 38.2% more than

2014. It is also expected to cross 255 billion INR by 2020 (FICCI-KMPG, 2016). It has

been estimated that by 2020 digital media will cover more than 11% of the total

advertising spend in India.

The second challenge involves overcoming the cost benefits of other media over print

media. In order to overcome this challenge, the print media started to provide their

content online for free and trying to make profit through some ad based business model.

Some publications even tried to charge for their online content. Because of the huge

content available online for free, the newspapers and magazines could not sustain their

mass audience. In order to serve the base subscribers and advertisers, the print media

adopted fixed product costs, which resulted in a decline in the number of copies sold.

New entrants and growing competition in the news and information space is the major

challenge faced by the newspaper and print industry. The increasing popularity of digital

medium as a source of news consumption led to the print industries to compete with

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television companies, technology giants and social media platform (FICCI-KMPG,

2016).

The newsprint prices in India reduced considerably from INR 31,000 per metric ton in

2014 to INR 27,500 per metric ton in 2015. Newsprint prices are a major concern for the

print industry as they have to guard themselves against any major price fluctuations.

According to the Times of India, issued on November 8, 2011, vernacular language

newspapers are increasing their circulation numbers as they penetrate into more cities and

rural areas; whereas, English newspapers are unwilling to expand beyond urban areas.

With the rise in literacy rate, spread of education, and the development schemes which

were implemented to increase the family income, many English newspapers today realise

their opportunities in rural India. Revenues of vernacular and Hindi language newspapers

constitute 60% of the total revenue in this market. Despite the growth in the educated

population, people tend to feel traditionally connected to their vernacular newspapers. In

order to increase the readership numbers, new platforms such as mobiles to receive news

updates became increasingly popular.

1.2. Problem Statement

The Internet and electronic media, commonly referred to as the “new media” throughout

this study, appears to displace or replace the existing print media. As print media is

largely dependent on the advertisements for its revenue, print media today is facing a

serious challenge as the advertisers and marketers are inclined towards online marketing

and digital advertising. Availability of high-speed internet connectivity and internet

penetration has led to the adoption of digital marketing. The increased rate of literacy and

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lack of connectivity in certain rural areas help in the sustainability of print media

especially vernacular newspapers. The number of internet users is rising every day at a

growth rate of 30% annually. Mobile internet dominates the total internet user base and

captures 61% of the total share. People who believe that print media is losing its

readership-base point to studies that indicate print media is declining due to the

development of electronic media; whereas, those who believe that print media is not

suffering due to internet contend that internet cannot substitute print media as the former

cannot fulfill the same needs and functions as that of the latter. This study attempts to

provide some insight into the potential impacts of the internet and other mass media on

print media in Gujarat.

The role of the online mass media after the 2001 earthquake in Gujarat in connecting the

people as a community to focus on the human needs is inevitable. The media followed

good professional practice in forming a disaster-response team on the basis of common

interests (Kodrich & Laituri, 2005). Hence, it can be seen that mass media play an

important role in disaster management. The role of mass media in today’s world cannot

be neglected while analyzing its impact on the print media. The present study analyses

the adaptation of print media in the current competitive scenario along with the

challenges it faces due to the advancements in the modern electronic media.

1.3. Significance of the Study

In the face of new communications technology and new media, traditional media or old

media can be considered have been speculated to have lost its functioning. No medium

can absolutely replace another medium. Each medium tends to serve the different needs

26
of its users in different contexts. From the user’s point of view, time and financial

resources play an important role in adopting the preferred media. People who are

information intensive use internet for news and information as well as other media for

information. People prefer different media based on their needs. According to the

principle of relative constancy, to support any new medium the money must come either

from the country’s economy or by diverting any existing media spending. New money in

the economy and significant losses of other media contribute to the growth of the new

media. Hence, it can be understood that new media would gradually displace or replace

the traditional media whose functionalities are identical (Nguyen & Western, 2006).

According to Nguyen and Western (2006), the time spent online was found to have

significant negative impact in the social activities of its users such as the time spent with

the family, colleagues and friends. According to Lee and Leung (2005), Interactive

Advertising Bureau has found that among the internet users, one fourth of them spent less

time with television and one tenth of them read less printed medium.

Despite the advantages of email, many users still prefer telephonic communication as the

norms of kinship interaction was found to be more important than the advantages of using

emails or electronic means of communication (Chen et al., 2002). A person who has

limited education and knowledge can find it difficult to retrieve information from the

internet; hence, he uses newspapers and magazines. If the user does not know to read, the

user can make use of the radio or television for their information. Newspaper survived

even after the inventions of radio and television because of the increased rate of literacy

and it was portable.

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Each media has its own advantages and disadvantages; and exists to meet the information

and communication needs of the people. Each medium tends to serve its audience

differently within different context. Each medium has a specific distinct content. For

example, newspapers are information intensive; whereas, television has entertainment

content. According to their levels of media-related need, individuals can prefer different

medium.

According to Stempel et al. (2000), the decline in the usage of traditional news medium

cannot be attributed to the adoption of the internet. They found that internet users were

also likely to use newspapers and radios. The advantages of using the internet were

considered only to be complementary and supplemental (Robinson et al., 2000). Some

internet users may still prefer to watch television news as it gives them an opportunity to

relax and interact with their family after long working hours. The news and information

on radio and television are superficial, which stimulates the users to dig deeper into the

information on the internet. Hence, it can be understood that people use internet when

they need more information without reducing the time they spend on the traditional

sources. Internet reduces the time spent on traditional, non-media activities which in turn

increases the time spent on internet (Nguyen & Western, 2006).

This study makes an attempt to analyse the impact of new media on traditional media in

the present world. Though the findings by Nguyen and Western show that new media and

traditional media can coexist in the age of internet, it is important to analyse the impact of

the former on the latter in today’s context. The impact of internet and other media on

print media has to be analyzed so that print media and magazines can make more

informed decisions regarding their future prints and online editions.

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1.4. Scope of the Study

With the advancements in technology, digital marketing have evolved over the time and

bridges the gap between interactive marketing and conventional marketing. Due to this,

the traditional advertising agencies and marketers will be under pressure to change their

marketing strategy in order to stay competitive in the advertising market.

Development of advanced technologies such as virtual reality and chat combined with a

customer’s preference for content helps in promoting internet advertising. Further, the

advertisers have realised that the internet is the only platform to post interactive ads.

Hence, internet medium has become more popular among the advertisers.

Online advertising helps the advertisers to keep track of certain metrics such as number

of clicks, number of views, cookies to track viewer’s interests and provide content

accordingly, and monitor the leads generated in close real time. The emergence of such

metrics affected the conventional advertisements. The advertisers make use of such

metrics to gain valuable insights about the reach and potential of their advertisements.

Internet pricing for advertisements are based on results and marketer’s objectives. Hence,

three models of internet pricing evolved, namely, pricing per exposure, pricing per

response, and pricing per action. Owing to the technological support on several pricing

mechanisms, the online advertising has become more popular than the traditional

advertising (Cartellieri et al., 1997).

Companies which strive to establish their brands utilise online consumer engagement.

Online consumer engagement helps in creating a competitive advantage; thereby, the

companies can establish their brand. Social media helps the companies in reaching the

29
masses to promote their products. Social media provides a lot of opportunities for the

companies to interact with their customers. Brand enhancement and brand awareness can

also be promoted with the help of social media (Zailskaite-Jakste, 2012).

The decline in print news readership can be strongly predicted by age. The adults who are

above the age of 60 years develop the habit of newspaper reading as they retire; whereas,

young adults perceive newspaper reading to be time consuming. Some of the reasons for

the decline in newspaper readership can be attributed to the following: physical nature of

the newspapers, non-instant news, inability to multitask, efforts of reading, and the biased

nature of the newspapers.

The internet has ultimately become the main platform for information. The sustainability

of the newspapers can be improved by navigating to the digital landscape. Digital

newspapers can find online readers who can pay for their digital content. Owing to the

upsurge in digital advertising and online consumer engagement, the sustainability of the

newspaper industry is facing a serious threat. There is a dire need for the newspaper

industry to revamp their structural outlook and content to retain its base readers and

subscribers. The newspapers can also target the digital consumer segment that is ready to

pay for their online content.

The present study deals with analyzing the challenges faced by the print media due to the

rapid advancements made in electronic media. The impact of new media which includes

internet, smart phones, animation, gaming and VFX over the print media is significant.

Newspapers and print industries across the world are tailoring their strategies to meet the

needs of media consumption. People read newspapers only during particular hours in a

30
day; whereas, they are constantly using internet throughout the day. Internet is perceived

to satisfy more needs of the consumers than any other media. The accessibility of

entertainment channels according to the consumer’s interests and convenience, have

caused the internet media to pose serious threat to the print media. The newspapers must

be supplemented with additional products to target specified audience. The study aims at

analyzing the impact of other media on print media.

1.5. Objectives of the Study

The sustainability of print media is threatened by the advancements in the field of

technology adopted by other media. The newspaper industry also faces a serious

economic threat as the conventional advertisements, which are its main source of

revenue, are being replaced by online advertising and digital marketing.

The main objective of this study is to understand the present scenario of print media and

the various challenges it faces due to the evolution of electronic media. The key

objectives of the study can be put forward as follows:

1. To understand the present scenario of print media in India specifically with

respect to the state of Gujarat.

2. To understand the evolution of print media in India and analyse its current

challenges

3. To understand the adaptation of print media in the current competitive scenario

4. To study the readership behaviour of consumers in Gujarat.

5. To study the consumer’s and industry’s perceptions of newspapers in relation to

other media.

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 6. To study the sustenance of newsprint industry of Gujarat.

1.6. Operational definition

Print Media: Print media refers to a communication medium that utilises printed

publications and materials for the transfer of information. Print media includes printed

materials such as newspapers, magazines, brochures, catalogues etc. Print media is also

considered as the traditional media as it dates back to 600 A.D when the art of printing

was first invented. It is an effective medium to reach the public on a daily, weekly,

monthly or periodic basis.

Electronic Media: Electronic media is also a means of communication where the

audience makes use of electronic devices to access the available content. Unlike print

media, where the content reaches the audience in the form of printed material, in

electronic media the content is broadcasted to the wider public. Electronic media includes

television, radio, internet, smart phones and the like. Development of personal computers

and the internet helped in spreading digital media across the world. The data is made

available at any location as long as it is available in the server.

New Media: The terms ‘digital media’, ‘modern media’ and ‘new media’ are used

interchangeably throughout this study. New media generally refers to digital media,

which is interactive, compressible, networkable and available on demand. New media

includes contemporary digital media like smartphones, blogs and social networking sites.

1.7. Hypothesis

The following hypotheses were framed and tested for the study.

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Hypothesis 1: Consumer perception of print media has a significant effect on reaction to

advertisements given in the newspapers.

Hypothesis 2: Reading behaviour of consumers is significantly correlated to consumer

perception of print media.

Hypothesis 3: Spending behaviour of the advertisers is significantly affected by the

Market share, Circulation, and Readership of newspapers.

Hypothesis 4: The factors explaining revenue of print media are significantly correlated

to each other.

Hypothesis 5: Reading frequency of the consumers has significant effects on the

Consumers’ perception of media.

Hypothesis 6: Consumers’ perception of media has a significant impact on the perception

of revenue of the newspaper industry.

Hypothesis 7: Reaction to advertisements has a mediating effect on the relationship

between Consumer perception of print media and industry perception of revenue of the

newspaper industry.

1.8. Thesis Schema

The present thesis has been organised into the following chapters.

Chapter 1: Introduction

This chapter introduces the subject and provides the history and evolution of various

media. It also analyses the various challenges faced by the print media and provides

statistics on the reach of various media in India. The chapter also describes the scope and

33
significance of the study. The objectives of the study and problem statement are also

described in this chapter.

Chapter 2: Review of Literature

This chapter provides a detailed and extensive review of the existing literature on the

impact of internet and other media on print media. The underlying theories of the present

study are discussed in this chapter. Research gaps identified in the field of print and

electronic media is also provided in this chapter.

Chapter 3: Methodology

The methodology adopted in the current study for data collection and analysis is

described in detail in this chapter. The present study is a descriptive study where

questionnaires were designed in-depth to analyse the impact of other media over print

media and to analyse the current scenario of print media. In-depth interviews were also

conducted to obtain the primary data required for the study. The secondary data needed

for the study is collected from the industry reports, articles, conference presentations on

newspaper industry, and congressional testimonies. The collected data is analyzed using

different statistical tools.

Chapter 4: Results

The results from the statistical analysis are interpreted and discussed in detail in order to

obtain meaningful information. The results of various analysis and the discussion of the

same are provided in this chapter. This chapter explicates the major findings of the study.

Chapter 5: Discussion

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This chapter will discuss the interpretation of findings and align them with the objectives

of the study. The researcher will put forth new insights about the research problem

studied by reinforcing them with appropriate evidence from prior research studies

available on the topic.

Chapter 6: Conclusion

This chapter summarises the outcomes of the present analysis. The chapter also states

suggestions for future research, followed by Bibliography and Appendices.

35