Media Management

Media management refers to management of media organizations. So it constitutes two different terms-management and media organizations. For proper understanding of the concept, we must have a reasonable understanding of both the concepts management and media organization. Lets start from there.

Management
Organization:
A group of people working in concert to fulfill some commonly agreed goals. The people working in an organization do two types of work- operative work and administrative work. The people who do more administrative work see that others are working towards the common goal of the organization. They get the work done by the efforts of others. They are called the managers.

Management:
The process through which they get the work done is known as management. Thus management as a process is the art of getting the work done. The main functions of management are: Planning Organizing Staffing Directing Coordinating, and Controlling Planning: Organizing: Staffing: Directing: Coordinating: Controlling:

Principles of Management:
Henry Fayol developed his classical organization theory which focused on the broader arrangement of people in the organization. He developed a comprehensive approach to many aspects of organizing and was the first to carefully articulate the primary functions of a manager. He defined managing in terms of five functions: planning, organizing, commanding, coordinating, and controlling.

Fayol listed fourteen principles of management for smooth and effective management of an or8ganization: 1. Division of Labour 2. Authority 3. Discipline 4. Unity of Command 5. Unity of Direction 6. Subordination of Individual to Common Good 7. Remuneration 8. Centralization 9. Hierarchy 10. Order 11. Equity 12. Stability of Staff 13. Initiative 14. Esprite de corps.

Media Organizations:
Organization which produce, distribute, and promote information and programming (messages) are media organizations. Examples are: newspaper organization, radio or television centre, advertising/public relations agencies etc. Media firms develop, produce, and distribute messages that inform, entertain, and /or persuade. At their most basic level, information firms are like other manufacturers: they produce and distribute a product (messages) and then, in order to sell that product, they select an audience and develop marketing, promotion, and sales strategies to reach the audience.

Media Organizations as Manufacturers:

The diagram illustrates the basic manufacturering process of a media organization.
Gather Information Develop Messages Produce Messages Distribute Messages

Promote and Sell to Advertisers and Clients

Promote and Sell to Media Audiences

As depicted in the figure the various steps in manufacturing a media message are: gathering information, developing message, producing message, distributing message, and selling and promoting the messages to the medias 2

advertisers & clients, and audiences. Each step in the process involves a variety of activities. Although specific facets of the activities differ across media, overall they are highly similar from one kind of information organization to another. Gathering Information and Developing Messages: Gathering information for stories involves creating a list of ideas to be investigated and then sending reporters to check sources. After developing the raw material the reporters and editors complete the stories together that may entail pulling together several forms of informationwords, photography, and graphics. Producing Finished Copies of Messages: In producing the message, Technical difference exists between the print and electronic media. In print it involves typesetting, platemaking, and press runs. In television or film it involves film or video editing, splicing, sound dubbing, and colour coordination etc. Distributing the Message: Distribution entails transporting or screening the messages to the media audiences. In the case of print publications, the messages are distributed via trucks to delivery persons who take the papers to newsstands or homes, or they distribute electronically via data base. Broadcasters send their programmes through the air from their transmitter and tower directly to the listener/viewer. Advertising agencies simply send copies of their advertisements or commercials they produce to the specific media vehicles selected for dissemination of the advertisements to a target audiences. Promoting and Selling The Product: Media companies not only develop and produce information products, they also sell them. That necessitates making choices about the markets to serve and about promotion, sale, and, for many media, advertising strategies. Media companies serve two markets. The first we call the audience market i.e. the consumers of the media organizations products. The second is the Advertiser Market i.e. the clients or advertisers who advertise their products in the media. Any media company must develop and maintain reasonably good audience and advertiser markets for itself. The media companies develop appropriate messages and suitable strategies for promoting and distributing its products. The above discussions reveal that at the most basic level, media organizations as manufacturing process are similar to other manufacturing companies. So the good management principles developed from time to

time for effective management of manufacturing companies are equally applicable to media organizations as well. Further, the unique characteristics of media companies make their management more challenging.

Unique Characteristics of Media Companies:

The uniqueness of media companies lie in the following factors: 1) Nature of the Products: Perishable commodity Must produce a product during every production cycle Demands constant creativity and innovation,coordinated workflow, and deadline pressure Defects are easily visible 2) Types of Employees: Educated, professional, extremely hardworking, very creative; Ability to work independently, knowledge of the media laws; Primary allegiance to standards of journalism (the profession) and secondary allegiance to the company they serve; 3) Special Organizational Factors in media Companies: A flexible, horizontal structure may be better than the traditional, rigid, vertical hierarchy preferred in most industrial corporations; For producing fresh, innovative, informative, high-quality messages, employees should have some freedom from rigid work schedules. 4) Societal Role of the Media As the watch dog and interpreter of public issues and events, media have a special role in the society, Constitutionally protected though indirectly; Enjoy some kind of economic and franchise protection More visible then other companies-mistakes easily detectable High public expectation of media being creditable and trustworthy; 5) The Blurring of Lines Among Traditional Media: Many companies operate varying combinations of newspapers, broadcaststations, magazines, databases,

directmail firms, book publications, billboard organizations, or combined advertising and public relations agencies. Interdependence among various media industries is becoming more important as new ways of delivering information create opportunities that transcend the boundaries of single medium. In each medium changes in technology, combined with the blurring of lines among the traditional media, make viewing the firm as it is or was in the past an anachronism.

Challenges for Media Managers:

The ultimate goal of media management is to deliver information or programming that people want or need in the most effective manner possible, irrespective of traditional media boundaries. As the various media services are becoming interdependent, the media managers has to have specialised knowledge about each of these industries, to be sure, but increasingly they will need media management knowledge that will enable them to span and connect diverse operations. As the nation moves from industrial to information society, the media represent one of the more dramatically changing growth sectors. The speed of the change coupled with the unique nature of the media that makes managing media firms a challenging job. Understanding the implication of these changes and to think about the many new options for serving their audiences is emerging as an essential prerequisite for success of media mangers. This is here the principles of media management become important. These changes are the backdrop against which the essence of the media managers job is cast.

Qualities of Media Managers:

In todays competitive media environment, building brands in the field of media demands expertise and thorough understanding of the media. To be successful media manager today demands specialized knowledge and skills which one can develop through education and training. If aspiring for the challenging jobs you should: Have Creativity and Managerial Skills As a new generation media manager you should be working round the clock to create liaisons between the media and communication focused industries. The primary goal is to reach target audiences effectively and efficiently and thereby increase company market share and revenue. Accomplishing this requires one to synthesize creativity, technical competence and managerial skills and have a working knowledge of both creative and business aspects of the

media, from production and editing of media software to its buying and selling Challenge the Conventional Be it information, entertainment or advertisement that is disseminated through the media, in each case managers need to know not just how to communicate, but also how to make and manage communication. It is glamorous job, but one that requires extreme hardwork, presence of mind, complete product knowledge, commitment, awareness of the competitors position and constant up gradation of skills. Honesty and willingness to innovate-since the medium of communication has to evolve-the courage to challenge the conventional and a bit of number crunching, which is necessary. Equip yourself Media management being rather new academic discipline, no standardized courses is on offer. While there are two-year programmes in executive MBA,in media and communication in universities abroad, the Indian counterpart is mostly called PG Diploma in Entertainment and media management.

Main functions of Media Managers:

John M. Lavine and Daniel B. Wackman in their book Managing Media Oganisation have identified the following primary functions of media managers: 1. 2. 3. 4. 5. Planning and Decision Making; Organizing Work and Technology; Financial Management; Working With People; Leadership of the Media

Media as Industry and as a Profession:

Today mass media is both an industry and a profession. During the early years it was started as a mission- to serve the society and the people. Gradually it emerged as a profession engaging thousands of people fulfilling certain responsibilities towards the society. But with the passing of time, profit motive and big money crept into the system and media emerged as a big industry all over the world. Today it is very complicated and difficult to isolate functions of media as an industry and as a profession. As an industry media is more concerned about its business goals. But as a profession it more concerned about its social responsibility.

Goals of media organizations:

The main goals of media organizations are the following: i. Know and serve its market ii. Produce quality products and /or services iii. Attract, develop and retain best possible employees iv. Increase and maintain profits v. Position the organization to prosper in future vi. Protect the companys franchise From the organisations point of view, increasing profit is essential to meet the other goals, but certainly not the top priority. For many progressive managers, effectively serving the medias market and the needs of their employees are the primary goals, for if both are taken care of, adequate profit will be realized. Thus long-term business perspective demands that profit be put in their proper place; not as the principal goal of media firm, but as vital key element on the list.

Responsibilities of media as profession (Social responsibility of media):

From the point of view of the people and organizations who constitute the medias markets, there are variety of need the organizations are expected to cater to, whch include the following: i. Delivery of timely and useful information about events and issues ii. Interpretation of news reports iii. Development of ways to socialize individuals and to pass on values and culture to succeeding generations iv. Enhancement of opportunities for the hearing of a diversity of political, social, and cultural voices v. Opportunity to receive both news and advertising about the business and economic systems. These are some of the medias major social responsibilities. The support, the society provides the media, in terms of economic advantages, protective laws, and, of course, its constitutional privileges, depends on the medias effectiveness in carrying out these social responsibilities. Short-term actions, which ignore these social obligations, undermine the medias public support, and hence the special place the media hold in a society. It must be kept in mind that a long-term perspective towards social responsibility does not conflict with an aggressive business perspective. In fact, they complement each other. A mature managerial philosophy emphasizes that, information organizations should fulfill their societal responsibilities, not just because they have a social obligation to do so, but because doing so is good for business. Media managers are central when it comes to deciding:

 The degree of emphasis the organization places on profit and other business goals; The level of media organizations commitment to social responsibilities; The balance between business goal and social responsibility. To create an even balance between business considerations and social responsibilities is the most important and challenging job for media managers of today. They make this difficult decision, under the shadow of the major influencing trends, the media world is witnessing today.

Major Influencing Trends in the Media

1. Many Faceted Movement Towards Bigness-ownership, financial, employment 2. Dramatic Advances In Technology-communication technology, computers, Internet 3. Increased Emphasis on Markets and the Market Perspective-market driven media content 4. Heightened Profit Consciousness-search for new income streams, reduce investment risks

1. Movement towards Bigness:

The move towards bigness of media companies has many facets: ownership concentration, financial bigness, and bigness in terms of employment provided. i. Ownership concentration in media is taking place through mergers, take-overs, acquisition, large scale investments-leading to emergence of multimedia conglomerates. ii. Big money is involved in the management of todays media organisations. Media companies generate a lot of money through sales, and advertising. They also make large scale expenses in technology and process innovations, salary and fringe benefits to employees, huge investments in expansion and diversification existing projects and new projects. iii. Media organisations are moving towards bigness in terms of employment opportunities provided. They engage thousands of employees to look after both editorial and business side of the organization.

2. Advances in technology:
In recent times, dramatic changes are taking place in the media technology, which is changing the way information is received and delivered. The application of new information and communication technologies are giving a different shape to the media industry. For example, computer and satellite technologies have changed television news programming in conjunction with

other technological developments in camera and editing equipments. For the media managers, these represent a potent of extraordinary and exciting change. The ongoing technological developments create new possibilities for the kind and amount of information that can be presented as well as the best methods to present it. But these leaps of unavoidable technological up gradations cost media firms a great deal. They involve enormous outlays for new broadcast or print equipments-amounts well beyond the capabilities of many smaller media firms. This, in fact, is forcing many media firms to consider selling out to bigger companies, or shifting towards marketing perspective.

3. Increased emphasis on marketing perspective:

Increased competition for audiences and advertisers has placed greater emphasis on the marketing perspective. Media managers are using more thorough information about audience preferences to tailor their products to match research results. As part of marketing strategies, information conglomerates capitalize of audience synergism to create multimedia products that generate many income streams from one creative effort, such as a film that spawns records, CDs, music video, books, and on occasions, television spin-offs. In the face of increased competition for audiences, media firms promote their products much more aggressively than ever before. Brand managers are recruited to handle this job of brand promotion. In addition, product improvements and new product features are increasingly attend to by media companies. As a visible marketing strategy is that TV networks spend millions of rupees promoting the image of their star news anchors.

4. Heightened profit consciousness

With the media increasingly seen as an industry, profit consciousness is influencing every decision in the management of media. The strong motivation for short-term profits, often de-motivate media managers to commit huge sums as long-term investments for the future. Often decisions are made to heighten current profits, often at the expense of the future. This, combined with the three preceding trends, collectively concentrate many media mangers attention on profit consciousness, which leads to some reactions with far reaching consequences. The most visible reactions of heightened profit consciousness among media managers are the following: i. search for new income streams to maintain profitability, this includes the option of increasing subscription price of media products; ii. attempts to find out ways to reduce investment risks

Ownership patterns of Mass Media in India:

At one time all newspapers were local, and most were individual enterprises. One individual was generally the owner publisher, editor and printer. One individual managed every thing of the newspaper and management was some kind of a family affairs. As opportunities to serve increased, the newspaper size expanded and its operations became more complex. Gradually it

expanded into a big organization and a number of persons were engaged to look after its various aspects. Newspaper organizations as individual enterprise, gave way to other types of newspaper ownership, management and operations. The most common types of newspaper ownership patterns found today are the following: Sole proprietorship Partnership Private limited companies Public limited companies Trusts Cooperatives Religious institutions (societies), and Franchises (chains)

Unit-II Hierarchy, functions and organization structure

Types of organization:
Three common types of organizations are found in business and industry. These are 1) pyramid 2) functional 3) staff and line A pyramid type organization is similar to that of a military organization. Authority is assigned by ranks and titles in an unquestioned delegation of superior and inferior positions. In functional type organizations, authority is assigned by levels of work or particular duties, with each function having its own final authority. Such structure would not be practical for a newspaper because departments would be pulling away from and against each other instead of pulling together. In staff and line type organization, control is graduated down in levels, with each stratum having its final authority. The departments are headed by executives who are directly responsible to a superior, but each executive is given full responsibility and authority within the group supervised. The staff and line type structure is most suitable for a media organization, for it provides functional autonomy to various departments, to get their work done. This type of organization provides freedom, which is essential for creative work. Let us discuss how an organization structure is created. The process of creating the structure is known as organizing.

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Organising
Organizing is establishing a structure in which employees in different positions, can most effectively do their own work, as well as coordinate their activities with others. The following steps are followed in organising (the sequence of organizing): 1. Identify the task to be performed 2. arrange the tasks in sequential order (work flow sequence) 3. assign the tasks to positions (jobs) 4. determine how to coordinate and control the flow of work 5. put all the parts together in an overall structure There are four key factors, which influence the organization structure: i. mission and strategy of the organisation ii. technology used for its work processes iii. skill level of the organisations employees and managers iv. size of the organization and its resource base As these factors varies from organization to organization, so also their structure.

Major divisions of a newspaper

Newspaper organizations are commonly organised into the following major dividsions: 1. Editorial 2. General management 3. Finance 4. Circulation 5. Advertising (marketing) 6. Personnel management 7. Production(mechanical) 8. Reference

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Publisher

General Manager

Editor/Man aging Editor

Advertising Director

Circulation Manager

Production Superintendent

Finance Manager

Personnel Manager

The hierarchy, structure and functions of these departments of a media organization, especially a newspaper, are discussed here under.

Hierarchy
Hierarchy refers to the layers of personnel with varying designations, in the organization. Organizations with large number of layers are known as tall organization, in which, there exists large number designations, in between the chief and the employees at the lowest level. But organizations, with few numbers of layers in between the chief and the lowest level are known as flat organization. In case of flat organizations, the scope for interaction between the superiors and subordinates is much higher compared to tall orgainsation. The nature of the media organizations work, and its employees, demand flat type of organization structure.

Editorial Department
The organizational structure and the number of personnel working in the editorial department of a newspaper depends on the size of the newspaper, the philosophy of the proprietor, the type of ownership, and the nature of technology in use. A typical editorial news department structure is presented hereunder.

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Editor

Chief Correspondent

Resident Editor (Central office) Photographers

Managing Editor (Other units)

Resident editor

Other functions

City Correspondents

Special correspondents Correspondents Foreign correspondents Photographers

Departmental work Discipline Personal report Parliament/assembly news

City Correspondents

Special writers

Asst Editor (Day)

Asst.Editor (Night)

Translators Trainees Correspondents

Photographers Designers Feature writers Cartoonists

News editor Cf. Dy editor Sr Dy editor Jr dy editor Trainees

Trainees Photographer s Cartoonists

Chief Dy. Editor Sr Dy. Editors Sub Editors Chief of desk

Editorssports. Commerce,

culture, law

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Main sections of the editorial news department:

All reading material except advertisement is assembled in the editorial department of a newspaper. A large editorial news department will have five general divisions: 1. 2. 3. 4. 5. The Newsroom Copy desk Editorial room Picture division, and Library

Newsroom: All general news is either prepared or processed in the newsroom. The world, national and state news is brought in by wire for editing. The city editor assigns reporters to cover local news stories. News is received by telephone, telegraph, personal interviews. Copy Desk: Located in the newsroom but almost a separate division, where copies turned in by reporters and checked by city editor are examined by experienced copy readers. They eliminate unnecessary and inappropriate words and phrases, correct spelling and punctuation, check facts, indicate paragraphs, and write headlines. Editorial Room:

Editorial Department Personnel and their Responsibilities

Editor: The editor heads the editorial news department of a newspaper. Write editorial/select subject and ask editorial writers to write editorial Supervises the editorial page, confers with the editorial writers, Over sees all matters pertaining to the newspaper policies Ensures that the philosophy of the publisher is reflected in the contents of the newspaper Managing editor: The managing editor and the news editor handle news material and ensure that the editorial news department has sufficient personnel and proper facilities for gathering news and handling features. The managing editor ensures that the editorial department has sufficient personnel and proper facilities for gathering news and handling features. News Editor: Ensures that all available news is sought and properly handled. City Editor: 14

Sees that community news is covered As the key person, carefully lists all coming events and at the proper time directs reporters to cover them The city desk is constantly open for news tips, to which reporters may be assigned to run down the facts Some reporters cover regular beats for news. Rewriters: Handle previously used copy or fresh copy that needs revising

Editorial Response Systems:

Letter to editor- 10 % of readers Readership study/survey/rating studies- acceptance of the newspaperdetermine the reactions of the readers to features, news, presentations, ad copy and display, format and typography, page positions Circulation audit Guest editor Citizen journalists Online newspresentations Readers forums

General Management Department Finance and accounts Department

The main responsibilities of the finance department of a newspaper include the following: 1. accounting and budgeting 2. financial analysis 3. examine/ascertain the cost-benefit ratio that would result from a managerial decision. The importance of these responsibilities and hence the finance department to the newspaper organization can be realised from the money and assets wheel presented hereunder.

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Media company as a wheel of money and assets

Money

accounts receivable collected to pay expenses and to create extra profit

Spent for material and labour costs to create products and services

Product inventory and/or services are sold to create money=cost+ profit

i. ii.

iii.

iv.

v.

A media firm spends money to buy equipments, materials including news material, and pays salary to its employees; The equipments, material are used by the employees to create products and services (inventory) i.e. newspapers, magazines, and broadcast programmes; The media firm sells its (inventory) products and services, to the subscribers/audiences as well as the advertisers/clients, there by creating accounts receivable; The media firm collects accounts receivable i.e. money owed to it by advertisers, subscribers, or clients, who purchase its products or services; The accounts receivable i.e. the money collected is paid for all costs associated with production and distribution of the products as well as to earn profit on the investments. With this profit in hand, the firm has more money to start the cycle again.

For effective management of this cycle, the responsibilities mentioned above are of paramount importance.

Accounting and Budgeting

The four main functions of the accounting department are the following: 1) general accounting-every thing necessary to give management and owners atrue picture of the financial condition and fiscal operations. 2) department record keeping-the tabulating necessary in each department to reveal to management the business being carried on there and the progress being made.

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3) cost finding-the process applied in determining the actual cost of a given salable unit of the newspaper such as column inch advertising or a single issue of the newspaper. 4) Budgeting-outlining in orderly form contemplated monthly or annual receipts from all possible sources and the monthly or annual expenditure considered necessary.

Managerial accounting:
It looks at a companys financial statements not just to gain a financial perspective, but to provide management with indicators of performance that will lead to actions to improve the companys operations.

Financial accounting:
The kind of accounting done by certified public accountants and bankers when they focus on the financial health of a company. They use the companys income statement and balance sheet to develop ratios that describe various aspects of a companys financial condition and performance: stability of company, how well a company utilizes its assets, and the firms profitability.

Financial Analysis:
To explain what a company is doing, has done, or plans to do. In brief, it is analyzing the companys financial performance, in terms of income expenditure statements.

The Income Statement:

It includes three major categories of entriesi. Revenue- sources of income ii. Operating expenses- expenses directly linked to operations iii. Non-operating expenses-expenses linked to the firms long-term investments.

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Income Statement
Total revenue -total operating expenses = operating profit (loss) -total non-operating expenses = profit (loss) before income taxes -income tax paid = net profit (loss)

Budget:
It simply lays out expected revenues and expenses for the next year. The main components of a budget are: Revenue- each source of revenue listed separately Expenses-each expenses category listed separately. They are divided into two categories: i. Operating expenses ii. Non-operating expenses

Departmental budget:
Departmental budgets includes the following itemsSalaries Telephone Rentals Media Memberships Maintenance TA Miscellaneous expenses

Financial concepts:
Understanding of some important financial concepts is very essential to be an effective media manager: Operating revenue Operating expenses Current assets Fixed assts Current liabilities Long-term liabilities Working capital = current assets-current liabilities Cash flow Expenses Profit and loss Opportunities for improving profits: Return on investment

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Payback Capital investment Net worth Accounts receivable turnover.

Main sections of the finance and accounts department:

Budget Accounts Bills Salary Advance Audit The common functions of the finance and accounts departments can be summarized as follows: 1. general accounting to reveal the financial condition and fiscal positions. The balance sheet of a company containing the statement of assets-current.fixed, intangible and others, and liabilities, networth of the company etc. 2. record keeping 3. cost finding 4. budgeting 5. financial analysis 6. revenue collections and payments 7. expenditure control

Circulation Department
The importance of the circulation department of a newspaper lies in the fact that it is indicator of a newspapers acceptability and social commitments. It is the foundation of a newspapers success, without which the newspaper cannot survive. It is the main source of revenue for a newspaper, for without good circulation no advertising revenue can be mobilized. In medium newspapers the advertising and circulation functions may be under the direct supervision of the business manager. But in well established newspapers like the advertising, circulation is also made into a separate department under the direct supervision of the circulation director or manager. The circulation department is often divided into a number of divisions like city circulation, state circulation, national circulation, mail circulation, traffic or fleet etc.

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Circulation Director

City Circulation Manager

State Circulation Manager

National Circulation Manager

Mail Circulation Manager

Traffic/fleet Manager

Circulation Promotion Fig. Circulation Department Structure

Billing and Collection

Sales people Carrier boys Huckers Agents

Main functions of the circulation Department: Packaging and dispatch Transportation and distribution Relationship with agents Postal subscription Billing and collection Print order Circulation audit Supply of information to RNI Marketing and circulation promotion

Advertising Department
Advertising department is the chief source of revenue for any media organization in general and a newspaper in particular. The main task of the advertising department of a newspaper is to well serve all the available accounts and keep the advertising volume at high level. In addition, also constantly search for new accounts. The advertising department of a big newspaper is divided into three units namely the local display advertisement unit, the general or national display advertisement unit, and the classified advertising unit. The organization chart of the advertising department of a newspaper is shown in figure.

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Advertising Director/Manager

Local display/ retail advertising Manager

General/Nation al advertising Manager

Classified advertising Manager

Research Director

Ad sales people Artists Copy writers

Special advertising representatives at large factory centres

Street, correspondence, and telephone sales people

Researchers Interviewers

Advertising Department Personnel requirements: To man the jobs of the advertising department of a newspaper, a number of people with appropriate skills and qualifications are engaged. However, the number of people engaged varies from organization to organisation, depending on the size and structure of the organisation, philosophy of the management, and the duties performed by the advertising department. Irrespective of the size, some common sections are found in the ad department. People with degignations commonly found in advertising departments of newspapers are: Advertising Director or Manager Display Advertising Manager Classified Advertising Manager National Advertising Manager Copywriters Artists Advertisement Sales People Telephone Solicitors Special Advertising Representatives Research Director Researchers, and Interviewers. Functions: The advertising director/ manager is the chief of the advertising department and the overall responsibility of the department lie on him. The success or failure of the department depends on his abilities. He sees that 1) all available accounts are well served 2) keeps the advertising volume at a high level 3) he is constantly on the alert for new accounts

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In the performance of these duties, he is actively assisted by various teams of personnel with expertise different areas of advertising business. The local display/retail advertising manager is the second most important person in the hierarchy, who reports to the advertising director. With active assistance from a force of advertising sales people, he takes care of advertising for the local business firms, and continually searches for new accounts. The classified advertising manager is responsible to mobilize classified advertisements for the newspaper with the help of the street, correspondence, and telephone sales people. The national advertising manager mobilizes advertisement and provides service to the clients at the national level, with the help of the special advertisement representatives stationed at industrial centers, and the advertisement sales people. The copywriters, artists, and photographers do the lead role in performing the creative work of writing the ad copy. The research director, researchers, and interviewers help in the advertising efforts by way of conducting research on the market and advertisements to collect the much needed information inputs to make the advertising efforts more effective.

Structure and Functions of the Personnel Management Department

The personnel management department of a newspaper shoulders the responsibility of managing the companys human resource. It is primarily responsible to ensure that the company had adequate supply of suitably qualified manpower available for the companys jobs and are well-motivated to work with team spirit. Starting from accessing the human resource requirements, the personnel department takes all possible steps for recruitment and selection of appropriate number of suitably qualified personnel to man the jobs of the company and properly developing and compensating them so as to ensure they put their fullest potentiality for the development of the company as well as their personnel development. Depending on the size of the organization, the personnel department if often divided into a number of divisions such as Recruitment, compensation, training and development, career planning, employee welfare etc.

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Director/Manager Personnel

Manager Recruitment

Manager Compensation

ManagerTraining and Development

ManagerCareer planning

Employee Welfare

Main functions of the personnel management department: Human resource planning Recruitment and selection Placement and induction Training and development Career planning and adjustment- promotion, transfer Compensation Employee welfare-employee benefits and services Discipline Employee motivation

Structure and Functions of the mechanical/Production Department

Mechanical department of a newspaper is given with the most important function of producing the newspaper as finished products for distribution to the readers. It is responsible for procurement, maintenance and development of appropriate printing machinery for timely printing of the newspaper copies and commercial printing work whenever taken.

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Mechanical Superintendent

Composing Room Supervisor

Press Supervisor

Operators of Photo Type Setting machines Paste-up and make-up personnel Proof Readers

Plate makers Offset Press Operators Helpers Artists

Structure and Functions of the Reference Department

Apex Bodies: (RNI, DAVP, INS, ABC)

Office of the Registrar of Newspapers for India
The office of the Registrar of Newspapers for India (RNI) is a statutory body of the central government responsible for issue of certificates of registration to newspapers published under valid declaration, and compilation of a register containing relevant data regarding ownership and circulation of all newspapers published in India. The office of the RNI was created on 1st July 1956, pursuant to the recommendations of the first press commission in its report in 1954. Provisions for the duties and functions of the RNI were incorporated in the Press and Registration of the Books Act 1867 through an amendment. The main functions of the RNI are as follows: Compilation and maintenance of a register of newspapers containing particulars about all newspapers published in India Issue of certificates of registration to the newspapers published under valid declaration Oversees the allocation of titles, newsprint and certificates for the import of printing and allied machinery required by newspapers Scrutiny and analysis of annual statements sent by the publishers of newspapers, containing information on circulation, ownership etc. Preparation and submission to the government of India an annual report containing a summary of all available information and statistics about the press in India with particular reference to the emerging trends in circulation and in direction of common ownership units etc.

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Conducts frequent checks to verify the periodicity and circulation of newspapers to ensure that newspapers are published in accordance with the provisions of law.

Directorate of Advertising and Visual Publicity

DAVP is the nodal agency to undertake multimedia advertising and publicity of policies and programmes of the Government. All types of advertisements of all ministries and departments of the government of India excluding railways are released to the press by the Directorate of Advertising and Visual Publicity. The advertisement campaigns of this unit are mostly focused on communal harmony, national unity, family welfare, healthcare, rural development, welfare of weaker sections and the handicapped, empowerment of women, drug abuse prevention, economic reforms, promotion of handicrafts, etc. For this purpose electronic media, print media, exhibitions, outdoor publicity like hoardings, kiosks etc. are utilized. The origin of DAVP can be traced to the world war-II when the erstwhile government appointed a Chief Press Advisor followed by the appointment of an Advertising Consultant under him in 1941. In 1942, the Advertising Consultants office became the advertising branch of the Department of Information And Broadcasting. With expansion of its scope, the advertising unit was declared as attached office of the Ministry of Information and Broadcasting on Oct 1, 1955. The office was renamed as the Directorate of Advertising and Visual Publicity and became a separate body. The main set-up of DAVP at the headquarters consists of several wings like Campaign, Advertising, Outdoor Publicity, Printed Publicity, Exhibitions, Electronic Data Processing Centre, Mass Mailing, Audio-Visual Cell and Studio. DAVP releases press advertisements on behalf of various Ministries/ Departments and autonomous bodies. The main functions of the DAVP are as follows: Meets multi-media publicity requirements of different ministries and departments of government of India including Public Sector Undertakings. Communicates with the grassroots level on behalf of the various ministries through formulating communication strategies, their designing, release of press advertisements, printing of folders, posters, kits, booklets, stickers, etc., outdoor publicity through hoardings, busback panels, banners, computer animation displays, etc. or publicity through audio-visual media. Nationwide distribution of printed publicity materials on behalf of the government Create awareness among the people on socio-economic theme and seeking their participation in development activities.

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Indian Newspaper Society

The Indian and Eastern Newspaper Society was started in February 1939, as a central organization of the newspapers of India, Burma and Ceylon, to promote common interests of member newspapers. During the war years, the society advised the government regarding the equitable administration of newsprint controls. The society actively pursued the project of running a purely Indian news agency owned and managed by the Indian press. The society established a news agency known as Press Trust of India in 1947 and decided to restrict its membership to owners of newspapers subscribing to any of the Press Trusts prospective news services.In December 1947 the Society deputed its delegation under the leadership of Kasturi Srinivasan to London to settle the terms of an agreement with Reuters in regard to the Associated Press of India. The other important subject which occupied the attention of the society during 1947-48 was supply of news print. A revised News print Control Order was issued by the government of India with effect from April 3, 1947 which significantly relaxed the terms of their use. A news paper price-page schedule was also introduced. A five member sub-committee of the Society considered the proposals and drew up a draft memorandum and articles of association for the Audit Bureau of Circulation. The IENS was registered under the Societies Registration Act. With certain changes in the societys constitution it evolved the system of accrediting advertising agencies. The partition of the country brought in its trail many difficulties- a number of its members being forced to shift to the other side. Over the years the society has not confined its activities to domestic issues and problems confronting its members, it has been concerned with organizations and services connected with newspapers, whose interests, wellbeing and proper functioning are vital importance to the press. The main objects of the society are as follows: to promote and safeguard the news paper publishing interests of the members and to take suitable steps in respect of such business as are affected by action of legislature, Government, law Courts, municipal and local bodies etc., to collect information upon all topics having a practical bearing for its members and to communicate the same to them; to promote cooperation in all matters affecting the common business interests of its members; and to hold periodical conferences of its members to discuss and determine action on issues of common business interest.

Audit Bureau of Circulation

The Audit Bureau of Circulation is an independent, self-financing, private body, charged with the responsibility of conducting regular audit of the net circulation of newspapers and to issue certificates of net paid circulation

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every six months. Though a private body but enjoys high reputation for reliability and impartiality. ABC is one of the several organizations of the same name operating in different parts of the world. Though affiliated to each other each of these organizations are entirely different from each other. During the early 1890s, with the growth of mass advertising, some newspapers and magazine publishers began inflating the number of readers for their publications in order to at least collect more advertising revenue. In an effort to check this deceptive practice, advertisers and publishers joined together to form the ABC in 1914. The main purpose of the ABC was to establish ground rules for counting circulation, to make sure that the rules were enforced, and to provide verified reports of circulation data. In India it came into existence in 1948 with headquarters at Bombay with the following objectives: To issue standardized statements of circulation of members To verify the figures shown in these statements by auditors examination of necessary records To disseminate circulation data for the benefit of advertisers, advertising agencies and newspaper publications.

Functions
The publishers maintain detail record of circulation data of their publication. In case of newspapers, these records would include such information as the number of copies delivered by carriers, the number of papers sold over the counter and the number delivered by mail. Twice in a year, the publishers file their detailed circulation data with the ABC which the ABC in turn disseminated to its clients for information. Once every year, the ABC audits publications to verify that the figures that have been reported are accurate. An ABC representative visits the publication and is free to examine records and files that contain data on press runs, invoices for newsprint and transcripts for circulation records. Accordingly errors if any are rectified to prepare authentic reports of the circulation of different publication. The ABC reports are helpful to both the advertisers as well as the newspapers. On the basis of the verified circulation figures, the advertisers prepare their advertising plans. With the same verified circulation figures, newspapers try to win over the advertisers confidence. The figures also help the publishers to understand their position, strength and to chalk out future strategies.

Unit-III Media Economics (Economics of print and electronic media)

Media economics is concerned with how media operators meet the informational and entertainment wants and needs of the audieneces, advertisers and society with the available resources. It deals with the factors

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influencing production of media goods and services and the allocation of those products for consumption.

Economics
Economics is the study of how limited or scarce-resources are allocated to satisfy competing and unlimited needs and wants, and of the forces that direct and constrain that activity. Scarcity exists because resources are finite, where as wants tend to be infinite, exceeding available resources. Economics is the study of production and consumption of resources and products, as well as the choices made to meet needs and wants. Production is the creation of goods and services for consumption. And consumption is the use of goods and services or resources to satisfy wants and needs. Individuals and firms are both producers and consumers in that they consume resources and produce goods and services. According to the level of analysis, economics is divided into two branches: macroeconomics and microeconomics. Macroeconomics studies and analyses the operation of the economic system as a whole, usually at the national level. Microeconomics, on the other hand, considers the market system in operation, looking at the economic activities of producers and consumers in specific markets. It considers the behaviour of individual producers and consumers, as well as of aggregate groups of producers and consumers in those markets.

Needs and wants

Needs and wants are both public and private. Private needs and wants include subsistence, convenience, individually determined wants and needs. Public wants and needs include such items as military forces to protect against foreign aggression, police forces to protect individuals and property from criminals etc. Media organizations function in the economic system to meet both private and public needs and wants. Media caters to the wants and needs of four different groups: 1. media owners 2. media audiences 3. advertisers, and 4. media employees. Media owners want: i) preservation of the firm and its assets ii) high rate of return on their investment iii) Company growth iv) increase in value of the firm , and thus their investment. Media audiences want; i) high quality media products and services at low cost ii) wish to acquire the product wit ease

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Advertisers want:

i) access to their targeted audiences at low price ii) high quality service from media employees

Media organization employees want: i) good compensation ii) fair and equal treatment iii) safe and pleasant working conditions iv) psychic rewards for their labour. All these groups are involved in both consumption and production. Media also serve public wants and needs by providing forums in which ideas and issues may be conveyed that are necessary for the maintenance of social order and progress. Public wants for media include multiple stable media outlets, organised use of resources, and content diversity.

Allocation
Choices are made among the wants and available resources to determine which and how many of the wants will be satisfied with scarce/finite resources. This process is called allocation of resources. Allocation involvers three major choices using available resources: 6. what goods should be produced 7. how should it be produced, and who or what will do the work, where the goods will be made 8. whoa gets to consume the goods or services The first issue involves answering questions of what should be produced and made available to meet wants. It also involves deciding on how much should be produced to meet those wants. For example, in the realm of media, it involves public choices over whether the government should allocate available broadcast frequencies for more local TV stations or for mobile phone communications. In media the allocative issues are addressed by answering questions such as whether life disk jockeys or automated playback should be used in radio stations, and whether a TV programme should be filmed in a studio in Hollywood or Bollywood. The third major issue is who will consume the goods and services. This is how will they be distributed among people and industries. Four major allocation patterns are commonly found: 1) traditional decision making, in which choices are based on repetition of earlier decisions; 2) market decision making, in which the amount of supply and consumer demand determine prices, which in turn influence production and who is able to receive goods and services; 3) centralized decision making, in which choices are made by authorities and planning boards, and

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mixed decision making, which combines elements of market and centralized decision making. Allocation decisions, in India, are made by mixed decision making, with a great reliance on the market but some central planning. The market economy is a system in which allocative decisions are made on the basis of the economic forces controlling operations of the market. Market economy is the primary basis of the capitalist or free economic enterprise system. Adam smith in the Wealth of Nations (1776) argued that the market systems operation was based on several principles, which are as follows: 1) competition between different producers and competition between different consumers are the central elements of the system 2) consumers and producers have equal strength in the market 3) economic self-interest of producers and consumers will be used as a guide in all production and consumption decisions. 4) The market is its own regulator and will operate in an orderly fashion, producing what is needed and wanted by consumers, at prices consumers are willing to pay and at which producers are willing to sell. The market constantly readjusts to meet changing needs and wants and the demands of consumers of products. Smith argued that if the market was left alone (laissez faire) to operate according to these basic principles, capital would be accumulated that would be used for new production, resulting in growth in he national economy. This would improve the quality of life for all men and women, and society as a whole would be improved. But smiths critics such as Robert Owen and others believed that the market must be tempered by custodians of moral ethics (the Christian ethics) lest it become an immoral quest for accumulation that impoverished enslaved workers. Socialists argued hat the market system created inequalities that must be eliminated. David Ricardo, Karl Marx and others laid out some principles contradicting smiths principles of the market economy. They said, market economy, leads to diminishing competition between producers, creates unequal power between producers and consumers. State intervention and control of the economy, therefore, is inevitable. The principles of market system have remained the same, but the changes sparked by government intervention have resulted in mixed economies rather than pure market economies.

4)

Media and the Market Place

Media in India are for most pat capitalist ventures, operated by private parties for the purpose of generating profit, and are thus subjected to the operational principles of the market system. Even not for profit media such as public

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service broadcasting or organizations operated media are influenced by the principles of market system and are thus affected by its operations. These principles affect the operation of the media, and hence, the media managers must understand how they apply to media. It is also necessary to understand the issues that are raised in media operations as individual and aggregate firms produce media goods and services for consumption by individual and aggregate consumers. Media firms use scare resources- electricity, paper, equipment, skilled labor, programming, ionformation-to satisfy their wants i.e. produce media goods and services and gain profit. Consumers use scarce resources time and money-to satisfy their wants and needs i.e. to acquire information and be entertained by media products or to get their messages carried in the media. Because the resources are scarce, producers and consumers of the media goods and services are constrained in their abilities to meet all their wants and needs. Thus, both turn to allocation to determine what and how media products will be produced and consumed. Media economics focuses on these basic issues, concentrating on the operations of economic principles in media markets. Understanding these issues is vital for media managers of today and tomorrow.Thes can provide a framework for understanding the underpinnings of the economics system affecting media and the specific issues that arise in media economics. These can be useful to media managers of tomorrow in analyzing and making appropriate economic decisions in the best interests of the organizations they serve as well as what is in the interest of the audiences.

Competition and Survival: The media goods/service market

Media industries operate in dual product market. They create one product but participate in two separate goods and service markets. Performance in each market affects performance in the other. The first market is good, the media product. The goods (sometimes called the content product) is the information and entertainment packaged and delivered in the form of a printed newspaper, magazine, or book, a radio or television broadcast, cable services, or a film or video production. This product is marketed to media consumers. Performance in this market is measured in a variety of ways. Circulation statistics no of copies sold, revenue from sales, audience ratings etc. Marketing contents to consumers involves attracting their attention to the product so that they will exchange their time and/or time and money for the product. Some media require that consumers pay money for the content product, but all consumers must pay with their time, a scarce resource.

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Differing characteristics of goods (whether private or public) affect demand for goods and consumption of goods. A good is considered to be a private good if its use by one consumer diminishes its availability to others. A public good, however, dos not diminish the availability of the good to others. Media are both private and public goods depending on their attributes.
Media Good/Service Market

Media Good (content product)

Access to Audiences (for advertisers)

private good examplenewspaper copy

public good exampletelevision broadcast

The second market in which media participate is the advertisers market. In this market media sell access to audiences to the advertisers. The advertisers are charged for the audience access they are provided by the media. The amount charged, for bringing viewers into contact with the advertisers messages, is more dependent upon the sizes and characteristics of he audiences to which access is provided. In both the markets, all media operating, compete with each other to attract the audiences and/or the advertisers. This leads to inter-media competition for survival. The sections of the media, which fail to compete with others, in terms of fulfilling audience wants and needs, get marginalised. Where as, the sections of the media, which proactively compete with others in the market survive and grow.

Inter-media Competition
In the broadest sense, all media compete in the content product market by providing information and entertainment. All though media have content similarities, newspapers, television,, radio,magazines,books,films,video cassettes, and other media products serve distinctly different needs and are used in distinctly different ways by audiences. They are no fully interchangeable products. For audiences, newspapers and magazines serve primarily information and idea functions while broadcast media, films and video serve primarily entertainment functions. Even magazines, which most frequently approximate the content provided by newspapers, clearly are not substitutes, because of differences in frequency and approaches to information. These differences affect the way in which content is conveyed and the time and format in which it is available. Because of content differences, day-to32

day substitution of different media as a source of information is limited. However, there appears to be a significant amount of long-term substitution of different media resulting from development and diffusion of new media technology.

Intra-media competition
Different units of the same medium operating in the same portion of the same geographic market generally compete with each other to provide content to audiences and access to audiences to advertisers, and can be substituted. Of course, diffeneces in the content product or audience that is accessible to advertisers exists because of product diffentiation and market segmentation result in variance. But the substitutability of units of the same medium is much greater than that between different media. But, some substitution with different content and audience access product can be made without giving up the attributes that make the product attractive. This leads to competition in the content product markets. However, the competition can be any of the following types: 1) perfect competition 2) monopolistic competition 3) oligopoly 4) monopoly Competition presents challenges as well as opportunities for the media firm and their managers. To survive and grow under stiff competition, innovative product, and marketing and advertising strategies are applied.

Marketing of Media
Marketing is all about identifying customer needs and desires and than tailor a product to match customer needs and interests. Marketing a media product involves: 1) identify a target market 2) create a mix of marketing elements to both serve the target market and to achieve the media firms objectives. The four important ingredients of the marketing mix commonly known as 4Ps of marketing are: product, promotion, place, price.

Product
The product is the most fundamental of the four Ps. The product should be designed to match customer need and interests, and should be of reasonably good quality. If the product is of poor quality and fails to satisfy customer wants, than, even a perfect match of the other elements of the marketing mix may not be adequate to help the product survive in the market. So an essential pre-requisite for marketing of media products is product quality and attributes.

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For a media organization, the products are newspapers, broadcast programme, advertising campaign etc. The media product can be tangible like a newspaper or intangible like a broadcast message. In the case of media products, both the contents and the package are important to attract the audiences. Three essential considerations for launching a media product: 1) whether a sizable audience exists 2) whether some advertisers could be identified ,who find that audience attractive 3) bring together all the elements of the marketing mix to develop an over all marketing plan There are three basic audience targeting strategies for any media product, which are- concentration, differentiation, and un-differentiation. Further, to identify the target audience, the market can be segmented according to their geographical location, or demographic factors. To illustrate, the product strategy for launch of a magazine had number of features, which are as follows: i. plan to secure articles ii. utilize an editorial board to review the submissions iii. set a balance of 80 % articles and advertisements iv. develop a system to receive articles electronically v. plan to print the journal in a form that meet quality demands of the audience

Promotion
Promotion refers to all the tools and methods aimed at convincing customers to buy or use a media product. Major tools used in promotion of media products include advertising, public relations, sales promotion, and direct sales. It is important to understand that a person passes through a number of intervening stages before making a final decision to purchase/use a product/service. According to the AIDA model, the purchase decision process passes through four stages as mentioned in the figure:
Awareness Interes t Desire Action

The first stage to create awareness about existence of the product. The second stage to stimulate interest in the product. The third stage is to turn the persons interest in the product to desire for the product. The fourth stage is to push the level of desire for the product, so that action is taken to purchase or use the media product. Different tools are effective at different stages of the purchase decision process.

Place

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Place refers to how a media firms product or service is distributed to its audiences. The location where the audience can use the product. What combination of carrier-delivery, mail, and news stand are used for a newspaper. Where a television station puts its tower. What pattern a cable television follow in wiring a community. All of these are distribution questions to be answered to determine available and accessible to customers, its products and services will be. Availability of the product at appropriate place and at appropriate time can make marketing job little bit easier, but non-availability of the product at a location convenient to the audiences can be an obstacle to marketing.

Price
The fourth, one of the important, elements of the marketing mix is pricing of the products. The media products could be priced or priceless. For example, free to air television channels are screened to audiences free of cost, but for the broadcast instruments. But for pay channels and subscription of newspaper and magazine copies, the audiences are required to pay a price. In the later case, the price of a media product is affected by the following factors: i. quality ii. package iii. place of delivery iv. level of competition v. socio-economic status of the audiences

Foreign Equity in Indian Media (including print media)

Another issue that is likely to have far reaching implications for the print media in India is the entry of foreign capital into the Indian print media sector. Though the issue has been under constant scrutiny of the government of India since the country got independence in 1947, it raised intense debate with the introduction of economic liberalization in the country in July 1991. Over the years some decisions of the Indian Supreme Court, resolution of the Indian parliament and recommendations of some committees and commissions have barred the entry of foreign print media into the country. As early as in 1959 the Supreme Court had ruled that a non-citizen running a newspaper is not entitled to press freedom as his fundamental right. The court ruled that a corporation or a company running a newspaper is not a citizen and hence it is not guaranteed press freedom, however its editors, directors and shareholders can claim that right under the provisions of Indian constitution. So, if a foreign newspaper is run as joint enterprise with an Indian newspaper, its Indian directors, shareholders and editors can seek the protection of the court, while foreign collaborators could seat back and avail the privilege of freedom of press and enjoy the benefits flowing from the above privilege. The first press commission in its report submitted in 1954 also did not favour the entry of foreign print media into the country, which 35

guided the government of India take a decision on this issue. The central government in 1955 decided that no foreign-owned newspaper or periodical should, in future, be published in India and that foreign newspapers and periodicals which dealt mainly with news and current affairs should be allowed to bring out their editions in India. Another decision taken by the government of India in 1956 on this issue was that communication facilities should be granted to foreign news agencies only where distribution of news within the country would be effected through an Indian news agency owned and managed by Indians, and which would have full and final authority in the selection of foreign news and their distribution and which would also be in a position to supply Indian news to foreign news agencies. The press council of India in a reference from the government of India communicated its views disapproving the entry of foreign print media. The majority view in the commission was that direct distribution of foreign news agency copy to Indian subscribers should not be allowed, and it did not favour publication of foreign papers/ journals in India involving equity and management participation. However the closing years of the 20th century generated heated debate with both the protagonists and opponents speaking on it with almost religious fervour. Those favoring the move consider the step as a logical outcome of the ongoing process of liberalization, whereas those opposing it advise caution against going blindfolded into an unknown area and cite the 1955 cabinet decision disallowing such entry as sacrosanct. They do not favour liberalization to mean restrictions on our sovereignty and threat to our democratic economy. They apprehend that the entry of all-powerful foreign media into India is not in the best interests of the Indian media, economy or culture. They are of the view that, foreign newspapers are not expected to have any concern for our culture, ethos or tradition and the cultural and moral fallout of the entry of foreign newspapers would be far more serious than the fallout of the advent of satellite TV in the country, where the print media still has greater influence than the electronic media. A former Prime Minister of India Mr. V.P.Singh opposes the entry of foreign newspapers into India in the following words the idea of allowing 26 % foreign direct investment in Indian print media is subversive. Its most obvious outcome, as one can see, will be a comprehensive balkanization of the intellectual space. The advent of foreign capital would threaten Indias tradition of pluralism and culture of diversity. Powered by their immense finances and goaded by an ambition to control the emerging Indian market, the foreign monopolies will impose their own agenda on the country. However the protagonists of the entry of foreign capital believe that the entry of foreign capital will bring several benefits to the Indian print media including infusion of capital and know-how, readers having more choices at lower prices, and help the country get integrated into the information superhighway.

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Setting aside all debates on the issue, the government of India in a significant decision at the later part of 2002 allowed foreign direct investment in the Indian print media sector. The decision of the government of India allowing up to 26 percent foreign direct investment in news and current affairs publications and up to 74 percent foreign participation in technical, medical, and specialized science journals, is likely to have significant impact on the print media in the country. It is hoped that a wave of professionalism will take on in the print media. The coverage of issues is likely to be better and we would also be exposed to newer styles. The professionals, who are currently a part of the industry, are also likely to witness a sea change in the conditions of work, largely by way of the emoluments. Foreign direct investment is expected to bring in a sound mechanism to evaluate readership, thereby having major impact on advertising. Within six months of allowing foreign investment in print media sector, in yet another policy decision on March 18, 2003 the government decided to fix a cap of 26 percent foreign investment in television news channels seeking for up linking from India. The decision on up linking will also allow 100 percent foreign equity to those up linking from India for entertainment. As such, the entertainment channels continue to be detected by the existing policy under which all channels irrespective of their ownership or management control are permitted to uplink from India subject to fulfillment of eligibility criteria. The 26 percent cap will also apply to those using the B2 bandwidth for broadcasting via VSats. Suitable amendments are being made to make the VSat licensing norms conform to the new up linking policy. After the cabinet decision, among the 24 applicants of news channels for up linking programmes from India, 12 got permission including Surya, Starnews, AAJ Tak and Zee-news. Due to this decision the Zee group will have to bring down its foreign holding by 30 percent. It can do this in two ways- foreign holders can disinvest 30 percent of their equity in favour of Indian retail investors or domestic equity partners or Indian promoters can pump in fresh equity to bring down foreign holding to 26 percent. The I & B Ministry also said the 26 % foreign equity would include foreign direct investment, foreign industrial investment, external commercial borrowings and investment by NRIs in news channels.

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