'New regulatory framework is important for the empowerment of digital media sector'

New Media expert Sanjay Trehan says the involvement of industry representatives in the policy formulation would not only bring transparency to the process but also empower the digital media industry.

Business Desk, ETV Bharat: As the Central Government is moving swiftly to put in place a policy framework for the online media industry, a veteran new media expert has said the industry should be consulted before finalising the policy.

Talking to ETV Bharat, Sanjay Trehan, Digital and New Media Consultant who has earlier been associated with firms like HT Media, Microsoft India, Times Internet, etc, said: “I welcome and support the government’s decision to put in place a new regulatory framework for digital news media. However, it would be great if an industry expert is sitting on the panel that is deciding on the final guidelines.”

“The final guidelines will not only help in keeping the whole process transparent, but will also be important for the empowerment of the digital media sector,” he added.

It may be recalled the Cabinet Secretariat last November released a notification to bring online news portals and OTT content providers under the ambit of the Ministry of Information and Broadcasting.

The notification has triggered speculation that the central government will roll out a comprehensive policy for the organic development of this sunshine sector.

Before this notification, only the print and electronic media were under the ambit of the Ministry of Information and Broadcasting and there was not a nodal ministry for the new media.

New media or over the top (OTT) media refer to news, information and entertainment services that are provided using internet services.

Driven by increasing digitisation over the few years, especially in the last six months due to Covid-19 triggered lockdowns, news consumption is gradually shifting to new media platforms.

Besides, growing digital advertising is also contributing to the growth of the online media industry.

“Digital advertising has emerged as the third largest advertising medium in India. It generated revenue worth Rs 15,467 crore (US$ 2.21 billion) in 2019. Digital will contribute 29% of the ad market size by 2021,” says the India Brand Equity Foundation of the Commerce Ministry.

Not a good idea to allow 100% foreign ownership

The government last October clarified the rule allowing 26% foreign direct investment (FDI) in digital news, saying that it would apply to all news aggregators, entities uploading streaming news on websites apps and other platforms as well as news agencies registered or located in India.

Trehan said that with India being such a culturally diverse and complex country, the government is well within its rights to restrict the inflow of foreign money in a sensitive sector like the media.

“You cannot allow majority or 100% foreign ownership of digital media outlets. They can potentially influence the cultural fabric of the country,” he observed.

On being asked whether such restriction can hamper the growth of the digital news medium in the country, Trehan said: “I am not sure if that will happen as it is actually not a new policy.”

To recall, the government had initially come up with the 26% FDI policy for digital news media companies in September 2019 through a press note and only made certain clarifications on the same in October this year.