Nepali Times
Strictly Business
Media mania


In the next few months, two new media houses will bring out four broadsheets in Kathmandu. Never mind that there are already 84 daily newspapers (broadsheets and tabloids) all across Nepal, with 23 of them based in the Kathmandu Valley alone. Given that (according to Advertising Association of Nepal) the print media advertising revenue stands at about Rs 710 million per year, the question on everyone's mind is: Will the new media houses be financially viable?

The answer is: maybe.

It depends on the owners' understanding that they are in a for-profit industry, and not in a for-charity one. What this means is that the way Nepali media companies are viewed, managed and run needs to be rethought.

Beware of superstars: It's tempting for a new company to get a head start by recruiting journalists working at other publications. Though this can be monetarily exciting for journalists, it's hardly in the long-term interests of the owners.

Ultimately, the expenses of keeping a team of superstars, and making sure that their egos are not easily bruised, exceed the revenues, especially when the revenue pie is not growing fast.

Indeed, borrowing a page from the Nepali music industry, the executive may glumly concede that the superstars are known only for being, well, superstars, and not necessarily for scoops and ground-breaking stories that make the readers and the advertisers regularly sit up and take notice. As such, it's well worth thinking whether it's better to hire fresh recruits who have the stamina, the focus, and the raw talent to succeed. After all, in journalism, as in music, you are only as good as the quality of what you last delivered.

Cash is king: One irony is that most journalists want stronger management in the companies they write about, but not necessarily in the ones for which they work.

Then again, managing a mainstream media company is not easy. The executive has to balance the budget without forgetting the media's civic mission, and without interfering too much with the kind of creativity and editorial freedom that the business demands.

But too much of a focus on either freedom or the civic mission may result in poor cash flow which leads to employees not being paid on time. One way to address this is to make all employees take the management seriously by creating an environment of open and frank conversation. Once it's clear to all that it's the availability of cash that runs the business, the conversation can then be about ways to raise and save cash so that excellence in journalism can be competitively paid for.

Media service company: Thanks to Internet connections that are becoming affordable, more and more readers are used to getting their news almost for free. This is not good news for newspapers that generate revenue by selling dead-tree products.

True, excellent journalism will always be in demand. But if distribution platforms are such that most consumers end up paying next to nothing for the content, then, where will the additional revenue come from?

One way to envision the future is to see the media company not as a traditional media company that puts out newspapers, but to recast it as a media service company. This means that the company may reformat or reuse its content to offer training programs, engage in advisory and consulting services, and undertake other media-related activities.

In this age of rising expenses and competition, adhering to the discipline of raising revenues and cutting costs is the only way for a Nepali media company to have a long-term future.

(11 JAN 2013 - 17 JAN 2013)