The mystery of the IRS 2012

There’s something about this data that bothers me. One, that in a country as large as India, the top ten publications, published in diverse languages such Hindi, Malayalam, Marathi, Tamil and English, all show startlingly similar performances.

The range of change in growth is between +0.000122 and -0.00325 CAGR

None has grown more that 0.000122 and de-grown by more than 0.00325 CAGR.

Even in markets where two players are fighting fiercely for market-share, the story is the same. In Kerala, for example, we see Malayala Manorama (-0.00624) and Mathrubhumi (-0.0099) both losing at similar rates.

It’s the wafer thin band that is a puzzle. If India was a static market, a super-mature market, one could understand this kind of extraordinary stability. If all markets in the country were in the same stage of development, one could understand the stability.

But it’s difficult to understand the stability when the country, as a whole, is seeing extraordinary changes. Changes caused by migration, changes caused by the mobility of the new Indian, changes caused by more and more Indians being education.

Or new graduates? Take the MBA sector alone. “More companies are seeking to hire fresh MBAs and master of accounting graduates in 2012 than they did last year, the 2012 Global Management Education Graduate survey by Graduate Management Admission Council ( GMAC) has shown. Nearly 79 percent of the companies polled said they planned to hire recent MBA graduates this year, as against 72 percent last year. On an average, the companies expected to increase new hires from 13 in 2011 to 17 per firm in 2012,” said domain-B less than a month ago .

Do these fresh recruits into the corporate world not result in increase in readership of newspapers?

If we take into account the slow and inevitable collapse of the joint family (due, in part, to the reasons mentioned above), it is difficult to understand and accept the numbers.

Unless, miraculously, all the publications in the list have added new readers at almost the same pace at which they have lost readers (due to migration, death, changing to another newspaper, and so on).

And then we come to the impact of new editions and titles and the closure of editions and titles. Do these, too, have no impact on these titles?

So many reasons to point to the inevitable change in readership of newspapers. Yet, according to the IRS survey, the industry is extraordinarily stable.

Or, perhaps, there’s a far more simple explanation: the top ten newspapers do not want growth - and cannot afford to de-grow.

At average cover prices, newspapers lose as much anything between Rs 8 and Rs 15 per copy that they sell. As a result, growth in circulation will result in a fall in profits, as advertising yields would not go up as a result of increased numbers.

However, a fall in circulation could encourage media buyers and advertisers to negotiate for lower rates - so that, too, is an unwanted outcome.

Are we witnessing, then, the maintenance of circulation figures at an artificial level? It’s an intriguing concept - because it would suggest some sort of cartelisation.