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India Today Chief: No More Investment In Digital Media, Can’t See The Returns

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imageAroon Purie (pictured, right), chairman and editor-in-chief at The India Today Group, India’s largest magazine publisher by revenue, spoke today at the 37th World Magazine Congress in London. At a panel discussion on Global Economic and Media Trends: Riding the Storm with William T. Kerr, chairman of the board, Meredith (NYSE: MDP) Corporation; Carolyn McCall OBE, Chief Executive, Guardian Media Group; and John Smith, Chief Executive, BBC Worldwide, Purie said he has decided to not spend any more money on digital media. His disillusionment with the medium mirrors that of several Indian publishers, who enjoy robust profits from their tradional properties and see no point in investing in new media, where they don’t enjoy proportionate returns in the immediate term. And with the economic slowdown eating into their main revenue streams, many are reportedly revisiting their digital operations…

Digital cutbacks, mobile future: You won’t find many newspaper or magazine editors or publishers admit they are cutting back on digital innovation spend, but that’s exactly what Purie is doing: “I have a revolutionary view: I said we’re not going to spend any money on this digital business because I don’t see any money coming in right away and I want to monetise things.” Away from PC-based viewing, Purie sees the real potential in mobile: “There are around 320 million mobile phones in India and we add 10 million every month. That for us is the future.”

Time travelling: Asked about the future for India Today, Purie said he wasn’t, but he stressed the need to continue to invest in editorial content both in print and online. “We’re fortunate in India — the problem we have right now is a short-term problem and it will be resolved. And the advantage of being in a developing country is that you can go to the future and come back; I can see what’s happening in developed countries and imagine it will happen to us.”

Digitally dumb: Purie says he goes on fact finding missions to the west, but he was less than complimentary about the prevailing media business models: “The digital model that is being followed in developed countries is a pretty dumb model. You have… one monopolist newsstand like Google (NSDQ: GOOG) who is giving your content out free and then competing in selling digital advertising. Where is the business model in this?” He said that unless a paid content model could be found, publishers are “all spending money, spending dollars to chase cents”. But Purie has the advantage of time: “I hope that this model is sorted out in the West and by the time it comes to us we have it all up and running.”

13 Responses to “India Today Chief: No More Investment In Digital Media, Can’t See The Returns”

  1. guest 1

    THERE are few things that unnerve Ann Moore, the chief executive of Time Inc, America’s largest magazine company, as much as young Americans’ “shock” when they hear that her firm will have to start charging them. “Real reporting takes time and money and effort,” she says. “Somebody does have to pay for the Baghdad bureau.” A recession is a difficult time to convince readers that they need to start paying for information, however, particularly because Time Inc, a division of Time Warner, a media giant, has long made its articles available free online. But a new model is needed, and Ms Moore is trying all sorts of things in her effort to find one.

  2. Aravind

    All said & done, there are no takers in India who pay for content. Google offering content free is not an aberration now. It is up to the bosses in the media industry especially who are running the print empire to analyse what lies in the future and how they are equipped to handle innovations happening in the PC/Web.

    Content packaged with Services will be a good bet for the users of this internet medium and am sure the next generation who lives very much on computers and mobile would not mind spending a penny to get that – Ecom was a non starter a decade back but it is different story now..

    I agree with Jeetendra as well – as it could be an idea to push the competition to think twice – but am sure the media industry is well connected and it is very difficult to keep it under the carpet..

  3. Jeetendra

    These comments are from people who understand the web and have sweated it out there. Anyway. I dont we should fret about comments as such. At times this is used as a strategy to get the other potential competitors to hold their digital plans or investments in them so that one can on the sly be preparing themselves very much for the digital warfare. To far fetched to listen to this kind of (un)revolutionary talk in this day and age. Bala from rediff used always at earlier seminars talk abt ecomm not talking off in india, and no future being there for ecom in India, but, behind the scenes there was feverish activity happeneing working on strengthening ecom for Rediff. But, that was ok then, now , its way too late to play that game.

  4. @Gokul: I am wondering whether Mr. Purie’s comments are actually “revolutionary” or reactionary!

    Isn't that typical? There's no media innovation in this country and the last header (Digitally Dumb) only underlines that in red ink. How can they claim to be revolutionary?

    Stop the much-malinged Google from crawling your websites. THAT is revolutionary.

  5. I could see India Today is way ahead of other media houses in using digital media. I like their optimism in the emerging digital channels, connectivity and interactivity they can bring to media companies.

    The pain points by the media houses who were monetizing through the earlier traditional print assets and are not able to get it effectively through digital media is to be understood. At the end of day, no business can provide anything for free.They need google and yahoo for their existence and can't allow them also to eat in to their pie.

  6. OMG. He really has absolutely no idea on whats really happening. Sheeesh… this is shocking! and he is heading the India Today Group? Puuhleeze. He's definitely not been in the trenches. Nor does he have any intuitive ideas on how money IS really made in the digital age. His closing remark … i hope its all sorted out in the west before it comes to India … blah blah … goes to show how short sighted this guy is and how much of a risk taker he is NOT .. but then why would he take a risk when he does not know the rules of the game and what is really happening around… clueless… yikes! (pardon the harshness – but this really is a shocker that needs to be dugg!

  7. N Kumar

    Digital media for a predominantly print business company is a complementary activity and one cannot see it as competition. I should think that a group like India Today would be just strengthening its arm and using the net as a promotional tool.

    Thanks to a new generation of button pushers and web crawlers who would not get out of their bean bag and pick up a mag from the stands, there is hope that digital media would do just that for them and deliver it straight to the couch :)

    As for the mud slinging, its was usually people do when they have nothing worth contributing, we can live with them too, for how good would the good be if we don't have a comparison.

  8. Guest 666

    Create and run a 1000 crore business and then we will talk about hypocrisy.

    The intertubes are filled with monkeys hammering away at keyboards reading wikipedia and thinking they have business smarts.

    So hammer away…

  9. >> This hypocrisy is typical of media bosses. On one hand, they want the traffic from Google. On the other hand, they wrongly accuse Google of giving out its content.

    Well said… more important, I do not understand the discrepancy in google aggregating content and benefiting from that… all the advertisements they place in their pages are for them to monetize, all the traffic they send your way is yours to monetize… Is this a case of sour grapes…

    Then again, maybe not… digital has very low entry barriers and thus, making money is tough… the only businesses that have made money over the internet are onces with strong network effect (google, naukri and social media; the latter hopes to make money)…

  10. If Mr Purie thinks Google is giving out its content for free then the first thing he should do is disable Google from crawling his websites.

    This hypocrisy is typical of media bosses. On one hand, they want the traffic from Google. On the other hand, they wrongly accuse Google of giving out its content.