Here is the Indian newspapers price problem: at the kiosk, you face a multitude of titles (roughly 4700 dailies across the country) including about 60 in English. Prices range from 1 to 3 rupees ($0.02 to $0.06). Even by Indian standards those are untenable rates: they cover only about 10% of variable costs. Finnish newsprint and German printing presses come at Western prices. Just for comparison, based on the Economist Big Mac Index, an Indian newspaper is roughly seven times cheaper than an American one; it is twenty times cheaper than a French daily.
Now, how do you significantly raise prices in a country where a decent meal costs about $2 ?
That question led to a heated debate at the last INMA South Asia Conference, in New Delhi. (INMA is the International News media Marketing Association). I was invited to talk about the migration from print to digital — which, let’s face it, is not on the top of the publisher’s mind in a country where internet penetration is about 7% of the total population (details here) – but India media moguls are keen to prepare their industry’s future.
The Indian press is staring at a difficult question. A few years ago, when we met for the first time in Chicago, Times of India’s CEO Ravi Dhariwal explained its newspaper was virtually free, with a price (3 rupees, $0.06) carefully adjusted to be slightly above the price of the scrap paper collected by poor people in the street of Delhi or Mumbai. Things have changed. As one of the publishers explained last Friday in Delhi: “We have built a bubble which is about to burst. Against all fundamentals, we have been pursuing circulation figures at any cost. Our model no longer works”. Around the table, the consensus was the price of papers had to go up significantly, probably by a factor of 2 to 5.
Well… Let’s consider a few impressive fundamentals. Circulation numbers are commensurate to India’s 1.2 billion population. According to the Indian Readership Survey, Dainak Jangran, a newspaper unknown to Western radars as it is published in Hindi, has 55 million readers in 19 editions. The Times of India is the world’s biggest English speaking newspaper, with a circulation of 4 million and a readership of 14 million. More