Corruption and Conflict of Interest Stalk the Newsroom

India: Boom-time for media but with 
a growing ethical deficit

By A.S. Panneerselvan

Indian media is an ironic entity. While it defies the global downward trend of traditional media and continues to grow in terms of new publications, television channels, websites and radio stations, it has failed to come up with a viable revenue stream, and some unscrupulous elements — both among the owners and the editors — have embarked on a path that can only be termed blatantly unethical.

Before getting into the specifics of unethical practice, it is important to look at some structural issues. One of the finest editors, Bharat Bhushan, has identified four factors that affect media content in India:

  • A growing market for newspaper readership and television viewing;
  • Market perceptions of what readers with disposable incomes want;
  • The changing role of the editor; and
  • Growing neo-liberal consensus between government, the corporate world and the media.

The statistics on the size of the Indian media also highlight the enormity of the challenges in regulating this vast market both in terms of the market and the content.

According to the Registrar of Newspapers, the number of newspapers in India is: 82,222. Delhi is the only city in the world with 16 English daily newspapers. The Information and Broadcasting Ministry revealed that the number of television channels in the country had grown from 130 in 2004 to 788 in 2014. The sector has witnessed exponential growth where the size of the television industry had almost trebled since 2006 to a predicted level of Rs 50,140 crore in 2014. (That’s just over five billion Pounds Sterling).

Image by carol mitchell (https:// ic.kr/p/a cYj) is licensed under CC BY 2.0

Image by carol mitchell (https:// ic.kr/p/a cYj) is licensed under CC BY 2.0

India has 124 million broadband Internet connections, and this is growing at a rate of 6 to 7 percent year on year and by the end of 2014, India will have more than 1,500 radio stations under three different categories — state-owned Prasar Bharati stations, privately owned FM stations, and community radio stations.

In all, according to a study conducted by KPMG for The Federation of Indian Chambers of Commerce and Industry (FICCI), the Indian media and entertainment sector grew by 12 percent in 2013, a little less than in 2012, but this flat growth is attributed to the slowdown in advertising spending on television and print and a strong dollar that increased print costs.

In spite of this growth and sense of a booming media sector, it’s not all good news in the media sector. In June 2013, Indian Vice-President Hamid Ansari, while addressing the Biennial Session of the National Union of Journalists, raised concerns about falling ethical standards. He warned about disconcerting media-related developments that “raise questions about the media’s objectivity and credibility.”

He said: “These relate to: cross-media ownership, the phenomenon of ‘paid news’, media ethics and the need for effective and viable self-regulatory mechanisms, the declining role of editors and their editorial freedom and the need to improve working conditions of media personnel, their safety and security.”

The focus of this report is to highlights some of the issues behind this concern over failing ethics and will look at just five issues – the problem of ‘paid news’; the introduction of opaque private treaties in the news business; blatant blackmail; a widening gap in the legal regulatory framework; and, finally, the industry’s flawed arrangements for measuring the audience reach and readership.

In doing so it’s important to add a caveat: Indian media is not monolithic, it has many faces: exemplary, good, bad and ugly. I am acutely aware that of the nearly 100,000 professionals in journalism, of which a substantial number of individuals and institutions uphold the core values and the cardinal principles of journalism. The exceptions are in a minority, but it’s a number sufficient in numbers to colour the popular perception and to undermine public trust. When that happens media urgently need to look inward and to reflect upon the need to rekindle commitment to ethics and journalism in the public interest.

The origins of ‘paid news’

In 1991 the Indian economy opened up. There was rapid growth of market forces and public investment in stocks and shares with some initial apprehensions that some journalists were writing only partial truths on behalf of corporations looking to be listed in the stock market. Some reporters were failing to uphold ethical practice and few doubted that they did so with support from their media institutions.

In April 2003, one of the senior photojournalists of India and a member of Press Council of India (PCI), N. Thiagarajan, drew the attention of the council to a growing practice of advertisments being published as news for a fee. The PCI did not investigate but, instead, asked media companies to consider whether such practices harmed or enhanced the standing of their publications in the eyes of the public. They also issued a guideline calling for a clear distinguishing line between advertisements and news in the press.

Mrinal Pande, a leading women journalist who rose to be the editor of a major Hindi daily and later the head of the public broadcasting corporation Prasar Bharati, wrote an insightful piece headlined The gains from masking reality, in The Hindu in 2009 in which she explained the way this ugly phenomenon worked.

She said: “Not too long ago, some major dailies introduced a devilishly cunning scheme of offering what was innocently labelled ‘Ad for Equity.’ This met with loud applause from many managerial bosses all over. But before long the property, aviation and automobile sectors went into a tailspin, and the scheme left the companies that had adopted it red-faced and holding bags of (economy class) air tickets, empty flats, and unsold cars and so on.

“A little later, during some of the Assembly elections in 2008, the local editions of several multi-edition Hindi dailies started displaying laudatory and frequently contradictory news items on their front pages about specific candidates. With zero news value, none of these items merited such display, but through the election period the front pages and op-ed pages of some dailies continued to carry mug-shots of particular candidates, even predicting a record win for him or her.”

Ms.Pande’s essay was exposing journalism for sale in the Hindi language press, but the sale of editorial space for cash was started by the richest media house of India, Bennett Coleman and Company Limited (BCCL), which publishes the world’s largest selling English language daily, The Times of India.

Ken Auletta’s essay titled, Citizens Jain: why India’s newspaper industry is thriving in the New Yorker, along with Paranjoy Guha Tharkurta’s book Media Ethics, (OUP, Delhi), and several essays by Ramon Magsaysay journalism award winner P. Sainath give complete details of how the BCCL worked out this model of revenue stream and assimilated it into the system.

In 2003, the BCCL established a paid content service called Medianet. It offered to send journalists to cover product launches or celebrity events for a fee and came out with a tariff for different types of coverage.

In response to the outrage this move generated both inside and outside journalism, BCCL sought to justify its actions by saying that public relations firms were already bribing journalists to ensure the coverage of their clients, and the Medianet initiative was just a way of removing the middleman, the PR agency, and, anyway, they said there was nothing wrong in this practice as the relevant news items did not appear in the main paper but only in city editions.

Despite the protests BCCL devised yet another revenue stream called Private Treaties, under which companies allocate a certain amount of equity to the BCCL in return for advertising space in BCCL-owned media products.

Though the company denies that that it provides favourable coverage to its clients who sign private treaties its own advertisement in The Times of India, and The Economic Times, on December 4, 2009, titled How to perform the Great Indian Rope Trick contradicted their claim. It talked about a clothing firm, Pantaloon, “gaining immensely” from the Times Private Treaties.

However, the issue only caught the public imagination following the 2009 elections to the state assembly of Maharashtra when a journalist with The Hindu, P. Sainath, exposed the scandal of political paid news in a series of articles that also revealed the cosy political and corporate relations in the news business. The wider corporate and political nexus also emerged from a set of exposes from Sucheta Dalal, the financial and economic reporter who broke the first scandal of the post-liberalisation India called the Harshad Mehta Scam.

Sainath’s work focused on two cases, one involving the Chief Minister of an industrialised state in India, and another involving a multi-national corporation and the richest media group in South Asia. His article, Reaping gold through cotton, and newsprint, documented how The Times of India, in a span of three years, carried a full-page item, firstly as news and then as an advertisement. The story brings out how government, corporate and media interests were woven together to push for corporate profits.

The Government of India had permitted a trial run of genetically modified seeds in certain parts of India, but there was vocal opposition to this move.

A report in The Times of India, on October 21, 2008, titled “Not a single person from the two villages has committed suicide” claimed: “There are no suicides here and people are prospering on agriculture.” The paper said the switch from the conventional cotton to genetically modified seeds “has led to a social and economic transformation in the villages [of Bhambraja and Antargaon] in the past three-four years.”

The same story was run again in the same newspaper, word for word. (Times of India, on August 28, 2011). This despite the fact there were distress suicides by farmers in these two villages, which were also well documented by Sainath.

The reason for the rerun was simple: the Indian Parliament had failed to introduce a bill that would regularise the use of the genetically modified seeds in August, and the repeat of the story was aimed at lobbying for quick introduction of the bill.

Sainath writes: “The failure to table the Bill — crucial to the future profits of the agri-biotech industry — sparked frenzied lobbying to have it brought in soon.” He said the full-page story titled Reaping Gold on the benefits of genetically-modified seeds on August 28 was followed by a flurry of advertisements from Mahyco-Monsanto Biotech (India) Ltd., in The Times of India and some other papers, starting the very next day.

“These appeared on August 29, 30, 31, September 1 and 3,” he wrote. Sadly for the bill’s sponsors it wasn’t introduced either in the monsoon or winter session of Parliament which was bogged down in other issues. Although the industry in this case did not “reap gold,” said Sainath others did “with newsprint.”

In the case of Ashok Chavan, then Chief Minister of Maharashtra, Sainath nailed the act of paid news by scanning the documents obtained through Right to Information Act. He noted that Maharashtra Chief Minister Ashok Chavan recorded spending a mere Rs. 5,379 on newspaper advertisements during the State Assembly election as well as another Rs. 6,000 on cable television advertisements.

“These figures,” said Sainath, “are clearly at odds with the unprecedented media coverage the Chief Minister got during the election campaign. The Hindu has gathered 47 full newspaper pages, many of them in colour, focused exclusively on Mr. Chavan, his leadership, his party and government. These appeared in large newspapers, including one ranking amongst India’s highest circulation dailies. However, they were not marked as advertisements.”

After looking at the procedures of the Indian election commission and the expenditure incurred by others in the same election, Sainath concluded: “Mr. Chavan received astonishing media coverage during the campaign. The newspapers carrying those many full pages on him nowhere marked them as advertising. In other words, this material ran as ‘news.’”

He said the flood of full pages on Mr. Chavan and his party, hailing this as the “Era of Ashok,” and the “Era of Development,” if advertising; this would have cost a small fortune in rupees.

These pieces were run in regional papers like Lokmat, the fourth largest daily in the country and the biggest in Maharashtra (2006).

As Sainath noted, “The huge mismatch between the account’s stated Rs. 5,379 and the dozens of full pages of ‘news’ in The Hindu’s possession will surely restoke the debate over what has now come to be called ‘paid news.’” He followed this with a number of other investigations for a year finally forcing the Press Council of India (PCI) to take action.

The PCI commissioned two of its members, Paranjoy Guha Thakurta and K. Sreenivas Reddy, to examine the paid news scandal. The fate of their report, a damning indictment of the practice, exposed the limitations of the Press Council and the immunity the media acquired using its numerical strength in the council’s governing structure.

The report told the full story, but its effect was nil. Some members of the PCI felt that naming the names of the publications would hurt the credibility of media houses. The council reduced the report to the status of a reference material, and decided not to publish it.

Nevertheless, some media watchers used the Right to Information Act to get the strongest indictment against the media in recent times to the public domain.

Commenting on the Council’s failure Sainath wrote: “Presented with a chance to make history, the Press Council of India has made a mess instead. The PCI has simply buckled at the knees before the challenge of ‘paid news.’ Its decision to sideline it’s own sub-committee’s report — which named and shamed the perpetrators of ‘paid news’ — will go down as one of the sorriest chapters in its history.”

Meanwhile the Indian Election Commission (EC) addressed this issue and although Ashok Chavan was found guilty of non-disclosure of his election expenditure, the commission failed to tackle head-on the question of paid news.

But even this was not the lowest point, that came when the senior editors of Zee News, a major television network, were arrested for allegedly demanding Rs. 100-crore from Jindal Steel and Power Ltd. in the form of advertisements in return for diluting the campaign launched by their news channels against the company in connection with a coal allocation scam.

This news of Zee News demanding money was exposed by the steel company itself in a reverse sting operation. The issue was exposed in an editorial in The Hindu entitled Media, where is thy sting? (October, 27, 2012) which read:

“On the face of it, paid news may seem no more than advertising camouflaged as reports or editorials. Naveen Jindal’s shocking ‘reverse sting’ — aimed at exposing how two editors of the Zee network attempted to cut a shady deal with his company — shows that it can be much worse than this.

“It is a reminder of how easily the culture of paid news can lead, ineluctably, towards extortion. There is only one word for promising to back off on an investigation in exchange for lucrative advertising revenue: blackmail.”

The editorial noted that Mr. Jindal had thrown a spotlight on an issue which has begun to darken the Indian mediascape: “the increasing number of deals between corporate houses and media outlets, whether in the form of paid news or private treaties, to guarantee favourable press and, whenever required, to black out unfavourable news.”

The tragedy is that the investigation in this case had made no progress. In June 2014, the Delhi High Court upheld a sessions court’s order directing the city police to conduct further probe against Zee Group Chairman Subhash Chandra, Zee editors Sudhir Chaudhary and Samir Ahluwalia for their alleged extortion bid from Congress MP Naveen Jindal’s firm. But the change in the government at the centre has cast a shadow over credible investigation because of the closeness of the Prime Minister Narendra Modi and Zee Group Chairman Chandra. Chandra shared the dais with Modi during the latter’s election rally at Kurukshetra – the constituency of Congressman and coal tycoon Naveen Jindal, who raised the issue of extortion in the first place.

It is in this context, one fully understands the anguish expressed by T N Ninan, Chairman of Business Standard group of publications and the former president of the Editors Guild of India. In a talk, Indian Media’s Dickensian Age, he observed: “We have never had such a vast audience or readership, but our credibility has never been so tested…the quality of what we offer to our public has never been better but that same public can see that the ethical foundations of our action have plumbed new depths.”

Behind both the critical assessment of ethical failings and the ruthless pursuit of dubious methods lies the biggest weakness of the Indian media: failure to get a fair assessment of both its readership for print platforms and its audience base for the broadcast streams.

Corruption when the numbers 
don’t add up

The Indian readership survey is supposed to give everyone — public, media and business interests alike — the demographic details of press readership and circulation. But the latest Indian Readership Survey (IRS) by the Media Research Users Council (MRUC) and Readership Studies Council of India (RSCI) has absurd figures which defy logic and reason.

When a survey — that projects its findings based on a sample on to a larger universe — comes out with results that are inconsistent with basic, independently verifiable facts, the obvious conclusion is that there is something seriously wrong with its methodology or its execution.

ZeeFor instance, the IRS report for 2013 claims the readership of English language newspapers as a whole plummeted by almost 20 percent but there is no explanation why and there are bizarre findings – for instance Hitavada, the leading English newspaper of Nagpur with a certified circulation of over 60,000, doesn’t appear to have a single reader. Many of the findings just don’t add up.

But it is not just in the press that the counting systems are in trouble. What is disheartening is that there is a total failure in capturing the reach of all forms of media.

The Television Rating Point (TRP), which is supposed to track the programmes that are most popular, has failed to gain the broadcast industry’s confidence. Prannoy Roy, one of the respected television personalities of Asia and the Chairman of broadcasting NDTV group, shared a baffling piece of information in his lecture at Oxford University last year. Speaking about the increasing tendency to fiddle with viewership ratings, he said: “Virtually every city in India has a ratings consultant who, for a relatively small fee, will ensure higher ratings for any channel.”

He revealed how the ratings consultants get to know where the people-meters that measure viewership are located. These are meant to be secret, but the ratings consultant visits the people-meter homes, gives the family a brand new 60-inch plasma television and tells them “Watch whatever you like on this lovely big television but on the television attached to the people-meter you must only watch such-and-such channels.”

Roy said: “The family also gets an additional reward at the end of the year if they have done what they were asked to do efficiently. Recently, Nielsen sent out their global head of security to India and, after an elaborate four-month investigation, he told a gathering of over a dozen people at the Taj Hotel in New Delhi, ‘I have never seen as much corruption of the Nielsen system anywhere else in the world as there is in India’”.

Statisticians and other number crunchers are expected to follow a rigorous methodology to provide reliable data on the media’s reach. But if their projections are deeply flawed, which they are right now, it is not just a matter of getting the math wrong, it also undermines people’s quest for the truth.

N. Ram, former editor-in chief of The Hindu group and currently group chairman used his James Cameron Memorial lecture in October 2012 to outline the full dimensions of the media crisis and to give a way forward from this murky reality.

He said: “The fortunes of the news industry and the state of journalism – ought not to be conflated. Manipulation of news, analysis, and comment to suit the owners’ financial or political interests; the downgrading and devaluing of editorial functions and content in some leading newspaper and news television organisations; systematic dumbing down, led by the nose by certain types of market research; the growing willingness within newspapers and news channels to tailor the editorial product to serve advertising and marketing goals set by owners and senior management personnel; hyper-commercialisation; price wars and aggressive practices in the home bases of other newspapers to overwhelm and kill competition; advertorials where the paid-for aspect of the news-like content is not properly disclosed or disclosed at all; private treaties; and rogue practices like paid election campaign news and bribe-taking for favourable coverage.

He warned: “If this is what it takes to have thriving newspapers and other news media, then there is something seriously wrong with this growth path.”

But, if some of the powerful players in the media industry are not willing to listen, then India’s media boom will be worthless to journalism and the pursuit of truth.

Even worse, it will of no value to India’s more than 1.2 billion people who may have more infotainment, sensationalism and political spin at their disposal but who will remain ignorant of the facts and analysis of events around them. When that happens the world’s largest democracy will be seriously weakened.

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Tagged with: ARTICLE 19, Asia-Pacific, BCCL, Business Models | Funding Journalism, India, journalism, Lokmat (India), Prasar Bharati, Press Council of India, South Asia, The Hindu, The Times of India, Thiagarajan, Zee News