Convergence Plus
Tuesday, January 19, 2021
Digital media to garner 65% of ad investment in India this year: GroupM

Print still relevant to advertisers wanting to build credible brands. Advertising investment in India is set to soar to ₹91,641 crore this year, representing an estimated growth of 10.7 per cent for 2020, according to GroupM, the media investment group of WPP, in its advertising expenditure (adex) forecasts for 2020.

Even with an overall slowdown in the global economy, Indian media spends are expected to be between low to moderate in H1, with robust growth anticipated in H2 2020. India is the eight-largest market globally and is the largest contributor to incremental ad spends.

Right behind UK and USA, India will retain its position, with China dropping to the fourth spot, said GroupM.

Prasanth Kumar, CEO, GroupM South Asia, said that while global adex is set to grow by 5.1 per cent, the Indian media landscape is constantly evolving and will witness the fastest growth. “While we expect sustained and stable investment across media in India, digital will garner 65 per cent of incremental ad spends in 2020,” he told a section of the audience at a meet in Mumbai.

The growth of digital is set to soar high because of changing consumer habits, with digital securing the number two position as the most-used media vehicle and estimated to reach 30 per cent of ad spend in 2020. Growth is expected from 3Vs (video, voice, vernacular-Indic) and advertising on e-commerce.

Sidharth Parashar, President - Investments and Pricing, GroupM India, added that though the format of print storytelling has been changing, content continues to be the strongest. “With print media organisations undergoing transformation across India, publication houses have invested heavily in promoting digital subscriptions and have started limiting access to digital versions of e-papers.”

Print will continue to remain relevant to advertisers wanting to build credible brands, the report noted. (Source: The Hindu Businessline)


Spectrum Sale may Fetch only ₹10kcr Initial Payment. Voda Idea, Bharti Airtel may give 5G spectrum a miss at current price but Jio may buy some

The government may generate upfront payments of only around ₹10,000 crore from spectrum auctions in the next fiscal year starting April 1, given the financial challenges faced by two major telcos Vodafone Idea and Bharti Airtel, telecom department officials have estimated.

This implies that the next spectrum sale could fetch it only around ₹35,000-40,000 crore overall as against the ₹5.86 lakh crore worth of airwaves that the government wants to put on sale at base price, experts said.

Telcos pay upfront 25% for the sub-1 GHz band and 50% for higher bands they win in auctions. The balance is paid over 16 years in equal instalments.

Senior officials told ET that loss-making mobile phone operators Vodafone Idea and Bharti Airtel — facing a combined ₹89,000 crore in new statutory dues — are expected to give the 5G spectrum a miss in the upcoming sale planned in March-April.

Airtel, though, is likely to pick up some 4G airwaves, especially in eight circles where its permits are expiring.

“Of the three players, Jio may take some 5G spectrum but not much, besides some 4G. We expect it will do so to get the firstmover advantage,” said a government official, who did not want to be named.

Loss-making Vodafone Idea, facing a survival threat and in the midst of a costly integration process, is expected to largely give the auctions a miss, officials said.

Spectrum Renewal Hopes

This means without the adjusted gross revenue dues, the government will fall way short of its ₹1.33 lakh crore budgeted for the next fiscal year, with only ₹20,000-25,000 crore expected to come from licence fees and spectrum usage charge.

Airwaves across the 4G bands of 700 MHz, 800 MHz, 900 MHz, 1,800 MHz, 2100 MHz, 2300 MHz and 2500 MHz, besides 5G spectrum in the 3300-3600 MHz bands, will be offered to Vodafone Idea, Bharti Airtel and Reliance Jio.

The auction, expected in the first quarter of the next fiscal year, will see some 8,293.95 MHz of airwaves at an estimated total base price of ₹5.86 lakh crore.

These numbers, however, look very optimistic.


“The government planning an auction is commendable, however, given the reserved prices for the most sought-after bands and the present financial condition of the industry, we do not believe the government will be able to garner any more than ₹6,000-7,000 crore as upfront payment,” said Rajan Mathews, director-general of the Cellular Operators Association of India (COAI), which represents all private telcos.

“This is not to negate the fact that there are tremendous opportunities in India, but what is getting in the way is the unrealistic pricing of the key spectrum bands that are for 5G, and the 700 MHz band,” Mathews added.

The government had cleared a base price for 5G airwaves at ₹492 crore per MHz and proposed the sale of a minimum 20 MHz blocks, which would mean a telco would have to spend close to ₹50,000 crore for 100 MHz — the quantum it needs to offer quality 5G services. For the 700 MHz band, which was unsold at the previous auction, the DoT has cut the base price by 43% to ₹6,568 crore a unit, or ₹32,840 crore for a block of 5 MHz.

Telcos have described the rates as expensive.

Earlier this week, Bharti Airtel CEO Gopal Vittal reiterated in an earnings call that the 5G airwaves were priced too high. “…we will not pick it up at those prices”, he said.

Previously, Vodafone Idea and Reliance Jio had termed the 5G base prices as too expensive.

“At the stage that we are in and where there is tremendous pressure based on their financial health, the upcoming auctions are expected to be muted,” said Prashant Singhal, global technology, media and telecommunications (emerging markets) leader at EY.


All hopes are pinned on spectrum renewal.

“The best case for the government is to realise value from spectrum renewals from the incumbents, and this may help the government raise ₹25,000 crore at most, of which Rs 10,000 crore may accrue in FY21. Over and above this has to be 5G spectrum auction, which seems very unlikely given the ecosystem and spectrum pricing,” said Rajiv Sharma, head of research at SBICap Securities.

If there is a 50% reduction in current 5G prices, then there may be some interest for 3,500 MHz and another ₹20,000 crore could be raised in the fiscal year starting April 1, 2021, he said.

“So, to sum up, spectrum auction is not going to be more than ₹35,000 crore,” Sharma said.

Already weighed down by debt of over ₹7 lakh crore, loss-making telcos Bharti Airtel and Vodafone Idea are now facing over ₹35,000 crore and ₹53,000 crore, respectively, in adjusted gross revenue dues after a Supreme Court order last October.

Both have filed a plea in the top court to be allowed to negotiate with the DoT on longer timelines and modalities for payment, in a bid to soften the financial blow. The court has yet to hear the matter. (Source: Economic Times)

Tech Platforms Take On Virus Rumours

Twitter, FB, Google & YouTube control misinformation through search prompts, removal of content & by teaming up with fact checkers. A social media deluge of alarming warnings, possible cures and rumours regarding the virus that originated in China.

On Friday, Twitter launched a dedicated search prompt for India with the ministry of health and family welfare and the World Health Organization (WHO) to ensure that individuals imemdiately get authoritative health information from the right sources when they search about the virus.

Facebook, Google and YouTube also flash the same link to the WHO website if ‘coronavirus’ or related terms are searched on their platforms.

Some Indians have enthusiastically taken to the Internet to ‘educate’ fellow users on the prevalence of the virus, possible prevention measures and cures.

While most videos correctly ask people to avoid crowded places, wear a mask and maintain basic hygiene, some have incorrectly claimed that ayurvedic remedies, including garlic and mint leaves, can cure the virus. Some have even created alarm by saying patients infected by the virus have a zero survival rate.

The virus, first identified in Wuhan in Hubei Province last year, causes respiratory illness. It is transmitted between people and animals. Scientists have yet to find a vaccine for the infection. The death toll has crossed 800 in China, while total infected cases have crossed 37,500. Facebook has also started removing content with claims and conspiracy theories that have been debunked by the WHO or other credible health experts and which could cause harm to people who believe them. The social media behemoth is focusing on claims where, if someone relies on the information, it would make them more likely to get sick or not get treatment. This includes claims related to false cures or prevention methods - like for instance ones that say that drinking bleach cures the infection - or claims that discourage treatment or create confusion about health resources that are available.

“As the global public health community works to keep people safe, Facebook is supporting their work in several ways, most especially by working to limit the spread of misinformation and harmful content about the virus and connecting people to helpful information,” said Kang-Xing Jin, Head of Health at Facebook in a blogpost.

Chinese short-video platform TikTok, owned by ByteDance, has put out a warning in 8 Indian languages for its users, asking them to verify facts with trusted sources, including the WHO or resources from the local government while creating, viewing or interacting with novel coronavirus-related content.

It has also asked users to report content that they think violates TikTok’s community guidelines. Videos with #Coronavirus hashtag have been viewed a staggering 786 million times on TikTok.(Source: Economic Times)

Ericsson, LG withdraw from Mobile World Congress 2020

On February 5, LG Electronics said it had decided to withdraw from MWC2020. Swedish telecom gear-maker Ericsson has withdrawn from the telecom industry event Mobile World Congress 2020 (MWC 2020), citing the outbreak of the Novel Coronavirus (nCov).

This follows a similar move by South Korea's LG Electronics, while Chinese telecom gear manufacturer ZTE Corp rubbished reports that it had dropped out of the world’s largest telecom event.

“After an extensive internal risk assessment, Ericsson has decided to take further precautionary measures by withdrawing from MWC Barcelona 2020, the largest event in the telecom industry,” Ericsson said in a statement.

“Ericsson appreciates that GSMA have done everything it can to control the risk. However, as one of the largest exhibitors, Ericsson has thousands of visitors in its hall each day and even if the risk is low, the company cannot guarantee the health and safety of its employees and visitors,” it said.

Börje Ekholm, President and CEO, Ericsson, said: “The health and safety of our employees, customers and other stakeholders are our highest priority. This is not a decision we have taken lightly”.

“It is very unfortunate, but we strongly believe the most responsible business decision is to withdraw our participation from this year’s event,” Ekholm added.

To showcase its portfolio and innovations, Ericsson will take the demos and content created for MWC Barcelona to customers in their home markets with local events called ‘Ericsson Unboxed’.

On February 5, LG Electronics said it had decided to withdraw from “LG Electronics is closely monitoring the situation related to the NCov outbreak, which was recently declared a global emergency by the World Health Organization as the virus continues to spread outside China,” it said.

“This decision removes the risk of exposing hundreds of LG employees to international travel, which has already become more restrictive as the virus continues to spread across borders,” it said, adding, LG will hold separate events in the near future to announce its 2020 mobile products. Dismissing certain media reports that said ZTE Corp has dropped out of the event following the nCov outbreak, the Chinese company said it will showcase a series of new 5G terminal devices at MWC 2020.

The GSM Association (GSMA), the organisers of MWC, the largest telecom event in the world, said it had outlined extensive plans to counter concerns and mitigate the risk of the spread of nCov outbreak at MWC Barcelona.

It also said that the impact this far as “minimal” and pointed to a wide range of measures in place to protect attendees during the event, taking place in Barcelona, Spain, from February 24-27 this year. (Source: The Hindu Businessline)

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