FLASH: Times of India group is about to buy Vaartha from the Sanghi family. MD of Times, Vineet Jain, Executive Director Saldhana and Executive editor Jojo were in town last week to finalise the deal. The move comes after Times made unsuccessful bid to buy out Andhrya Jyothi. Will the latest move go through?
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THE SOUTHERN SKIRMISH: For long, it was the domain of the Kasturi family, and it still remains so. Despite all the talk of inroads made by Deccan Chronicle, it still remains an also-ran in the leadership stakes for the Chennai market.
For starters, Deccan Chronicle which made its foray into the South with an edition in the Tamil Nadu capital took the Times route by starting out with a cover price war. DC also tied up with ICICI credit cards to offer the newspaper for a rock bottom price which was well above the trade terms of Audit Bureau of Circulation (ABC). Now that the heat and dust has settled, DC claims that it has a circulation of around 3 lakh and has an ABC certificate to prove that. But media buyers in the Dravidian heartland take the figures with a pinch (make that a tea spoon) of salt.
Just walk into any of the leading dealers of DC in Chennai at six in the evening and one can spot thousands of copies stacked up. In an industry where the product becomes obsolete by noon, such a sight is a sure confirmation of dumping. “It easy to dump copies and sell them in the raddi market with the connivance of the dealers,” says a leading media planner with one of Chennai’s biggest advertising agencies. DC circulation managers in Chennai accuse Hindu of doing the same in Hyderabad. It’s a game that everyone plays out, and media planners know that for sure.
So who is the leader in the Chennai market? No doubt the Kasturi family product Hindu still matters. But not for long. The Times of India is waiting on the sidelines watching the fun, for the Hindu and DC slugfest to end. Once both are bruised, Times will use its brute money power to steam roll into the Chennai market. Before that, if rumours are to be believed then Times might well start out with a Tamil newspaper, which it is said to be close to buying out. Once it gets that printing facility, Times will get its Chennai edition in place.
Financial analysts believe that it will be DC that will end as the biggest loser. DC’s total advertising revenues for all its editions last quarter put together was around Rs 86 crore. This is confirmed by all the tracking figures of all the leading publications in Hyderabad and Chennai based on full rates as per its rate card. Right now, only the Hyderabad edition of DC draws advertising on its own strength. Advertising agencies in Hyderabad say that DC offers up to 50% off on its card rates in Hyderabad. This fact, is confirmed by this writer who has seen bills raised by DC for its tabloid advertisers.
Even the Hyderabad citadel is under threat with The Times of India launching an all colour edition. Media watchers say, it was similar re-launch in Bangalore in 1996, that took Times past the then market leader Deccan Herald. Today, Times sells DH three to one. Times today prints around 1.85 lakh at its new Nacharam facility. Once they cross the psychological two-lakh mark then DC is in real trouble, as Times will repeat the Bangalore story here.
In fact, media watchers are wondering what happened to the proposed launch of DC in Bangalore. Sources say that DC bosses, the Reddy brothers are in talks with the owners of Deccan Herald for a possible buy out.
The danger for DC is that if it takes its eye off the Hyderabad market, then Times will hit hard in DC’s home turf. Times is already in talks with a leading industrial house in Hyderabad to buy its Telugu newspaper. On the other hand, if DC blinks in Chennai, then N Ram will go for its jugular. That’s the danger of ignoring your core competence, as management experts would say. Whatever it is, action south of Vindhyas is just hotting up!
The danger for DC is that if it takes its eye off the Hyderabad market, then Times will hit hard in DC’s home turf. Times is already in talks with a leading industrial house in Hyderabad to buy its Telugu newspaper. On the other hand, if DC blinks in Chennai, then N Ram will go for its jugular. That’s the danger of ignoring your core competence, as management experts would say. Whatever it is, action south of Vindhyas is just hotting up!
Write to vikram.apmedia@gmail.com
5 comments:
Deccan Chronicles claim of 3 lakhs circulation in Chennai is laughable. Even a kid knows that it does not sell more than 30,000 copies.
If it has such a high circulation, then why is not getting ads in its Chennai edition. Sadly, even the ABC auditors have been bribed to produce a certificate of 3 lakhs.
A Tamilian (and even an Andhra Tamilian) will read Hindu - Always. N Ram is not scared one bit about Deccan Chronicle. If there is one thing that gives him the scare - it's the Times. He knows that the Times guys really mean business, whichever city they are in.
Rohit
If Vaarta's taking over is true, there will be great problem for the employees since there is a likelihood of interviews once again to evaluate the performance of each individual.On the other hand, those who are rejected may go Udayam , their parent organisation.
Hey Vikram,
Dumping copies is nothing new. Hindu, ToI and DC does the same. In fact, a decade ago, Enaadu did the same and a few years ago, Swathi did the same. Just dump the copies and shoot up the circulation. The only publication which did not play using the dumping card was the "Encounter" of Pingali Dasaratharam, which was published from Vijayawada in 1980s. This weekly crossed 5 lakh circulation because of its scoops and punches. It was seen even in the remotest areas and people used to carry it in the buses and trains as they travel. At that time, Swati was only a small paper and was read only for Dr Samaram's questions and asnwers. The others, worried about the numbers, began to dump the copies in the market and in 1990s and this decade, it had spread to every publication. In fact, dumping copies and bribing the agents had become a management tool to give better circulation projections by the publications. Enaadu bribges even the taxi drivers of other papers to make sure that it's produ ct reaches the town ahead of others. So there is nothing to blame any paper on this front.
Hey! where does Express stand?
Hi Vikram,
It would be good if Times takes over vaartha newspaper. Vaartha journalists are fed up to collect Ads, schemes etc., It would be good news for Vaartha journalists if the Times is succesful in purchasing Vaartha.
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