New Delhi: Star News, the Hindi news channel of Star India Pvt. Ltd and ABP Ltd, was successfully rebranded ABP News after Rupert Murdoch’s company exited the news business last year. This month, the rebranding exercise is all set to debut as a case study at the Indian Institute of Management-Ahmedabad (IIM-A).

Ashok Venkatramani, chief executive officer of Media Content and Communications Services (India) Pvt. Ltd (MCCS), a unit of ABP that owns the TV channel, shares the strategy behind rebranding the company’s Hindi, Bangla and Marathi news channels, as well as the current state of broadcast media in the country. Edited excerpts from an interview:

How come the logo change and rechristening of the channel is becoming a case study? What was the toughest part of this change?

We got inquiries from three places—IIM Bangalore, IIM Ahmedabad and ISB (Indian School of Business in Hyderabad). I chose IIM Ahmedabad because it is my alma mater. They approached us after hearing about what we had done.

Our biggest fear and challenge was that the day our logo changes and people don’t recognize it, they would go away from the channel. If that happened, my business could have collapsed in three months. In news, if I don’t keep my ratings high, week on week, it will impact revenue. If my revenue shrinks, we could implode since we are not rich or profitable companies as a genre. So we had to ensure that ratings don’t fall. That is how we defined the problem.

We had to apply converse logic and make the brand redundant. We had to build the brand but make sure that what comes in the name of brand value, namely, content, does not change at all. Only the corner logo had to change which people should not notice. So that is what our tagline said...Kucchh nahi badla, sirf naam badla hai (nothing has changed but the name). Our ratings post-transition actually went up. That was due to focus and heavy advertising. Everything else was kept just the same. Advertising firm Lowe and its strategic design division dCell did the branding, design development and strategy.

Was the parting with Star cordial?

Throughout the process, the relationship between the partners was very cordial. We did not want to do anything to upset them. Even the new logo we got cleared by Star—not Star India but by their headquarters. Ideally, we would have liked a logo which was as close to the original and they would have liked a logo which was as far away from their Star logo (as possible). So there had to be some equilibrium. We did not want them to come back to us later and say they are filing a case on trademark infringement. In fact, they continue to look after our domestic and international distribution.

Did the split happen owing to a conflict?

No conflict. It was more to do with what they wanted to do with the brand. They obviously wanted to focus the Star brand on entertainment and sports.

Or were they tired of waiting for further liberalization of foreign direct investment (FDI) in news broadcasting?

That is always an issue. But they wanted to build a strong sports brand in India as ESPN was going. They probably anticipated opening up of FDI, which did not happen. Besides, news as a genre is also struggling. Carriage fee has not gone down and economic returns are not coming.

ABP News continues to be among the top two or three Hindi news channels. Critics attribute its success to the 40 crore annual carriage fee that you pay to cable operators.

Distribution, which we get by paying carriage fee, helps to reach the household. But then there’s the power of the brand that makes you switch on a channel. If both ABP News and Aaj Tak reach your home, you choose ABP but someone else chooses Aaj Tak. That helps us get part of the ratings. So reach is a function of physical reach and you watching a channel for at least a minute, as per TAM (the ratings agency).

Then comes stickiness, which, as per TAM, is the time spent on my channel. If my content is compelling enough, then a viewer will stay on my channel for a longer duration. The overall rating is a function of reach and time spent. So by paying more carriage fee, I am only fulfilling one of the three things required for ratings.

Today, in the news genre, I have the highest opportunity to see, which means I have paid the carriage fee to reach as many households. But my brand is not as strong as Aaj Tak (the number one channel), so the number of homes switching me on is less than the homes watching Aaj Tak.

How come the carriage fee has not gone down despite digitization?

Carriage fee had gone down 20% but has started going up again. The belief was that when digitization happens, consumers will pay, money will come to MSOs (multiple-system operators or large cable networks) who will pass on subscription money to broadcasters and hence the need for carriage money will go down.

But after one year, there was a stand-off between the local cable operators (LCOs) and MSOs. LCOs are not submitting the forms and payments required. So the MSO is getting squeezed as he has to invest in phase two and three of digitization, but the money flow in phase one has not happened. He is sympathetic but does not want me to reduce his outlay.

Why does Hindi news continue to be shrill?

That’s a sweeping statement. With Hindi, there is legacy in people’s mind—sensationalism. In 2009-10, when we changed, we got out of some genres such as astrology and religion. We stuck to political news and analysis as 80% of the people want only news. Yes, there are many channels which still feature babas but we are sticking to our core positioning.

Earlier, there was a lot of general entertainment content shown on news channels. The News Broadcasters Association (NBA) put in place guidelines on how many minutes an hour of programming you could take from others as fair reporting without paying money. If you exceed that, the entertainment channels could ask you for money and you have to pay that.

Is self-regulation working?

I think so. We have come a long way since the Mumbai terror shootouts. The NBSA (News Broadcasting Standards Authority) regularly updates the guidelines. The restraint was seen during the Ayodhya judgement, when Aishwarya Rai’s daughter was channel editors arrive at decisions on how to cover sensitive issues and follow them through.

NBSA has upgraded its version of dos and don’ts...on how to depict children, women... cricket. Everything has a guideline. What more needs to be done is to bring the smaller news channels as well as cable news channels under the purview of NBSA.

What are the current challenges in news broadcasting?

The galloping growth in broadcasting sector has come down. News genre is growing in low single digit. Viewership of English news is down. In the last five years, news genre share has shrunk from 8% to about 5% now.

That may be because viewership may have shifted to devices other television.

As a ratio of total size, news share has gone down although the absolute number of viewers has gone up because cable is expanding. I am not saying that the younger generation does not have an appetite for news but, currently, there is no way of knowing news viewership on other devices. Having said that, television news genre has stagnated. It is a huge issue.

If this industry cannot attract investors, it will stagnate. Media is a pillar of democracy. If media has to play a role, businesses have to do well, else you cannot invest in talent or news gathering. How do we ensure that the fragmented news media industry is robust and thriving?

ABP is a serious news player. We want six news channels but what is the incentive to pump in money? Who is responsible to make this industry healthy? MIB (ministry of information and broadcasting), Trai (Telecom Regulatory Authority of India) or news broadcasters? Or all three?

But you were launching a Punjabi news channel?

We have been waiting for a licence for two years. Our team has been under training for nine months. Our studios at Mohali are ready. We had thought that by the time we finish all our work—train people, build studios—the licence would come.