OPINION: India must focus political will on media deregulation

Last year, the largest gathering of humans in the history of mankind, estimated at 70 million pilgrims, took place at the Maha Kumph Mela celebration.

Marketers naturally saw this as a unique microcosm of India's macrocosm of masses, and campaigned to sell the believers Western soft drinks and such since this assembly had the rare quality of a lunar eclipse: a number roughly equal to 175 per cent of its cable TV subscribers all in one place at one time.

But numbers alone are no guarantee of success. Aggregating believers is far easier than achieving political and regulatory consensus, especially in the media sector. Unlike China, its competitor for future foreign media interest and investment, India does not exhibit the political of its rival.

Say what disparaging criticisms you will about China's authoritarian hand, it achieves. China's resoluteness will, I believe, cause increased pressure on India's media sector.

India has enjoyed, if you will, a most-favoured status by default. China's media market was closed. Resultantly, this significant factor, coupled with India's favourable characteristics, attracted both foreign and internal interest as well as fostering internal dynamism. It had democracy; English was spoken; capitalism prevailed (of course, like China, "with Indian characteristics"); foreign participation was welcomed (take for instance the TV sector, where only one of the three dominant players, Zee, is indigenous ; the other two, Sony and Star, are foreign); an entrepreneurial personality which enabled it to recognize and seize the opportunities technology presented (look at Bangalore); a rule of law was long-established; and, businessmen had a long familiarity with international commercial standards and practices.

Yet despite all these competitive advantages India is vulnerable to China in several respects. The average Indian earns about half the US$900 that his PRC counterpart does. Over the past decade China captured over US$300 billion in foreign direct investment while India got only $17b. China recently unseated the US as the recipient of the largest amount of FDI, estimated at $50b; it gets as much FDI in one month as India gets in a year. India in many ways is a relatively mature media market. The usual suspects of dynamics combustion in the media sector, and which can supercharge growth, such as advanced technology and opening of the sector, have already occurred and been embraced AND therefore their effect has already occurred and been integrated into the marketplace and industry. Further, existing support systems, like advertising, while still growing, will not do so at the rates it has in the past. And, the total India ad pie, at about US$3.5 billion does not have the have the same potential China's has given its smaller baseline.

Thus the fulcrum for India's media sector's, downturn or upswing, is the regulatory arena. In order to minimise China's attraction once it overcomes its internal challenges, as well as preserve as much of its competitiveness as possible, the politicians must mimic the communal purpose seen at the Ganges. They need to focus the political resolve to accelerate media deregulation if India wishes to fully realise its maximum potential and not stall vis-a-vis China.

Surely, if Indians can get together to form the biggest human event of all time, they can come together for this.