IT Firms Increase Focus on India's Media

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Rising power of Web 2.0

M&E companies also need to leverage Web 2.0 capabilities to embed third-party social networks, blogs, RSS feeds, instant messaging and other Web services directly into their business processes.

In particular, there is significant potential in social networking. Gartner's Gupta said: "Social networks help M&E companies develop communities of consumers that are a readymade base for advertisers."

These sites operate under an autonomous business model, in which members serve dual roles—as suppliers and consumers of content. In such autonomous business models, revenue is typically generated through advertisements.

There are also opportunities for subscription-based revenue when membership and content levels are sufficiently high. Puri explained: "Web 2.0 communities can also be used for new product feedback, shortening the product development time and targeting valuable marketing resources."

He added that these social networks are able to drive traffic to the media company's Web site, as well as hold discussions and give suggestions through Internet polls, comments and blogs. "Social networking sites and blogs are great means of brand building," Puri said.

Several IT companies including Oracle, IBM and HCL, have developed tools for Web 2.0. HCL's Content 2.0, for instance, is a network-publishing platform, while Oracle Social CRM applications encompass Web 2.0 features.

Digital TV boom

With new technologies such as IPTV, direct-to-home (DTH), interactive television and digitalization, the broadcast environment is also increasingly challenging. Some 70 million Indian homes have cable and satellite (C&S) TV, while 13 million homes have DTH. IPTV is still new to India and its penetration almost negligible.

"Digital distribution platforms such as DTH are transforming the industry," Kalsi said, noting that DTH players have introduced digital video recorders that free consumers from having to watch television based on broadcaster-ordained timetables. "This is ushering in a new phase of TV viewing," he said.

In July 2008, the Telecom Regulatory Authority of India (TRAI) set a five-year timeframe for cable TV operators to upgrade their current analogue network to digital transmission mode, in order to compete with new distribution platforms such as IPTV and Headend in the Sky.IT vendors such as HCL and Oracle, have again emerged with products touted to enable operators to convert to digital transmission.

Another growth area is mobile TV, which is still at a nascent stage but poised to grow big with the advent of 3G. This, too, will unleash several opportunities for the M&E industry.

According to the TRAI, 38 million people in India use Internet services via their mobile phones. When 3G is available, this figure is expected to rise further. The Internet and Mobile Association of India estimated that value-added mobile services will drive revenues for the telecom industry to US$2 billion by June-2009 and US$3.4 billion by June-2010.

Provided by ZDNet Asia—Where Technology Means Business

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