It has been almost four months the COVID 19 has affected globally. This has affected the economy of every individuals and organisation across the world. Among many industries, when we look into Media, the COVID 19 has been given challenges and opportunities as well. The consumption of media has been more comparatively post-lockdown. Media is playing an important role in the COVID-19 response, even as it carries the challenges to the industry. Some recent research shows between 80% and 90% of people consume news and entertainment for an average of almost 24 hours during a typical week. So it is a situation with cautious optimism.
Understanding the impact on main stakeholders of Media, which are Owners, Advertisers, Operators and Audiences have affected differently. We know that the consumption of media has been more as people are constantly engaging in the consumption of information and entertainment due to quarantine. But there is not much of production. There is more demand but less production. As there are many risks and challenges for production has led to a lack of investment. Owners are in fear of loss and management. When it comes to Operators, the challenge of the economy has forced to discharge many employees, and there is a volunteer back out as well. There is a demand for multi-tasking operators for profitable management. Also, the Owners are not efficient to afford the safety of operators. The advertisement industry has been impacted badly, as there are losses by the brands who are on break or there is no business to offer advertisements. Now advertisement being a financial backbone to Owners and Operators, it has affected the whole production of media. When there is no fuel of income generators, it is high risk and challenge for production and management to afford employees. But we cannot ignore the demand by the media consumers.
Understanding this gives an idea of how content creators, consumers and advertisers value media is as important as ever. New research by the World Economic Forum sheds light on some metrics that do so, as well as calling for new thinking on improved criteria.
One of the most direct ways to assess value is engagement, and not to lose the audience. On this front media is doing well. Between 80% and 90% of us read, watch or listen to news and entertainment for an average of almost 24 hours during a typical week. It’s no surprise that engagement with media is high, considering the variety of quality providers available today.
The issues forced by the media today are Social distancing guidelines trigger office closings, requiring more employees to work remotely. This increases cybersecurity risks. Compensation and benefits may not be sufficient in this pandemic. Suspension of movie and television production causes delays in release dates.
Upfronts go digital, an untested format that could negatively impact ad sales. Social distancing generates a boost in digital media — video and music streaming and downloads, as well as online publications. Operational, workforce and supply chain disruptions could result in financial reporting implications in current and future reporting periods. Public companies may face increasing pressure to disclose revised guidance related to COVID-19’s impact. The state’s tax implications arise for employees who are now working remotely as a result of the crisis.
Tax compliance operations could delay as newly remote employees lack timely access to information. In the short term, changes to income statements such as short-term losses may affect budgets. A prolonged economic downturn will likely lead to companies to consider significant budget cuts to eliminate optional spending. Remote work, online education and social distancing have been creating demand for products and services delivered by this industry.
The crisis underscores the need for flexible, resilient business models, including an increased focus on income-flow forecasting and impacts with supply chain and commercial channel partners. Company valuations may become more attractive for acquisitions by cash-rich companies that have been sitting on the sidelines with targets in mind. With the audience sector, the fan energy lags, as postponed events don’t generate the same interest they originally did. The crisis could fundamentally change how some sports are viewed, becoming “studio” events with empty venues. Some sports segments that are currently stalled due to COVID-19 — such as sports gambling could see an emergence of new interest after the crisis.
Unfortunately, the present epidemic has posed a huge threat particularly to the print media where thousands of workers have been working at little earnings and with no future economic security. Especially, those who are working at different vernacular print media houses having a gloomy future ahead because of the whim of their owners or proprietors
There is evidence that media engagement increases during shelter-in-place events. In 2017, Nielsen measured a 56% increase in television usage in the US during Hurricane Harvey. The trend is replicated in today’s context too. Italy and South Korea, two countries further along in their experience of the pandemic, have seen increases of 12-17% in TV consumption. Another barometer for value is the number of paying consumers. Some argue this is the most important because it is a critical component of financial sustainability in the industry. Here, there is room for improvement. On average, under half of the consumers pay for media – 44% for entertainment and only 16% for news.
But these benchmarks are static: they don’t prove whether the media’s value proposition to consumers is getting stronger. A more symbolic measure may be a future willingness to pay. This provides a dynamic reflection of value because it implies that the right mix of product and price exists, it just needs to be matched to customer and context. The fact that the proportion of consumers willing to pay in future – 53% for news and 70% for entertainment – is higher than those who currently pay suggests that media companies are in a good position to prove value to greater numbers of people.
This is emphasized by the trend that paid subscriptions are higher among young people than in older age groups. On average, over 60% of consumers aged 16-34 pay for entertainment, compared to 22% of those aged 55+. The youngest country like India can make a lot of benefits with this. The younger group is also more likely to pay for news. This generation grew up with the internet’s culture of free, so their greater desire to consume and pay is another indication of improving value.
The media industry may be among the hardest hit among many industries by the COVID-19 crisis, it is also the one as most of the world is relying on for crucial up-to-the-minute information and entertainment. As a way to counter the isolation caused by social distancing, the past crises have proven, the media industry has shown the ability to recover, it can be kept protected by the reinvention of ideas and the demand for it during the recovery of the media industry. Ultimately, consumers want to stay informed. They want to be entertained. And the media industry incorporating the ecosystem of B2B and B2C companies will continue to find ideas, engaging ways to help and deliver on the promise of keeping customers informed and entertained.
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Abhuthapurna Aksharamalike 