Latha Venkatraman
Shyam G. Menon

Mumbai, Feb. 3

REUTERS' proposed equity stake in Times Global Broadcasting Company Ltd, would be its first such investment in a broadcast outfit worldwide. "Investing in a television channel is important from a strategic perspective," Mr Charles G. Stocks, Vice-President (Media Strategy & Development), Reuters Media, said on Wednesday.

The company's traditional wholesale business, involving the supply of news, was a mature business with corresponding growth rate. Three years ago, Reuters, therefore, commenced a `direct to consumer' business segment, which would take it into formats capable of greater growth rates. Its initiatives in television and broadband fell in this space.

Times Now, the general news channel from Times Global Broadcasting officially went on air a couple of days ago. Reuters was set to acquire a 26 per cent stake in this broadcasting company from the Times Group, once the FIPB approved the move. Both Mr Stocks and Mr Sunil Lulla, Chief Executive Officer, Times Global Broadcasting, said most investment regulations in media, including the 26 per cent cap on foreign equity, were within the parameters of what was universally acceptable. As the third largest cable television market in the world, the country has 61 million cable and satellite (C&S) homes and 110 million television homes. "We are looking at other geographies and if we find similar opportunities to invest, we may. But we may also confine ourselves to India," Mr Stocks said. According to him, Reuters' interest covered linear television and interactive television.

The company had made inroads into interactive television using the Microsoft Media Centre platform. "It is broadband delivered-television and we are already present in 13 countries," he said. These markets included US, UK, a clutch of other countries in Europe and a few in Asia including Japan. The expansion of Reuters' interactive service would depend on the rollout of the Microsoft Media Centre platform in various markets.

"We make 18-20 hours of original video footage every day. The broadband delivered-channel is updated every half hour,'' Mr Stocks said. Revenues for Reuters came from advertisements carried on the channel. He conceded that in as much as Reuters possessed expertise in the wholesale news business, it had learning to do on the direct to consumer segment. Mr Stocks maintained that Reuters' investments in the direct to consumer space, including the one proposed in Times Global Broadcasting, were not mere financial investments. They were moves backed by operational synergies.

Notwithstanding its proposed equity holding in Times Global Broadcasting, Reuters would continue with its separate gathering of television news from India, for its wholesale business.

(This article was published in the Business Line print edition dated February 4, 2006)
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